There are growing signs that the global economy is fragmenting into competing blocs – NBC New York

• Focusing on Europe, European Central Bank President Christine Lagarde said a steady decline in the working-age population could begin as early as 2025, with climate disasters increasing each year.
• His response to these shocks would require massive investment in the short term, which he called a „generational effort.”

European Central Bank President Christine Lagarde said on Friday that Europe is now at a critical juncture, with globalisation, population and decarbonisation looming on the horizon.

„There are growing signs that the world economy is fragmenting into competing blocs.” she said At the European Banking Congress, according to a transcript.

He said a continued decline in the working-age population could begin as early as 2025, with climate disasters increasing each year, with a focus on Europe.

His response to these shocks was that it would require massive investment in a short period of time, which he called a „generational effort.”

„As new trade barriers emerge, we must rethink supply chains and invest in new ones that are safer, more efficient and closer to home,” Lagarde said in a keynote address.

„As our societies age, we must deploy new technologies so we can produce more with fewer workers. Digitization will help. And as our climate warms, we must advance the green transition without delay.”

Estimates show that an additional investment of 620 billion euros ($672 billion) will be required each year until the end of the decade, and that digital transformation will require 125 billion euros annually.

„Governments have the highest debt levels since World War II, and the European rescue fund will run out in 2026. Banks will play an important role, but we cannot expect them to take so much risk on their balance sheets,” he added. , highlighting the proposed Capital Markets Union (CMU).

Talks about a possible CMU for Europe are still ongoing. Its aim is to create a single market for capital, closer to what is available in the US

The EU says that is the official target „Money – investments and savings – flows across the EU so that consumers, investors and companies can benefit wherever they are.”