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The global economy will change due to coronavirus - the executives of the European Central Bank

The economic crisis caused by the coronavirus pandemic will lead to profound changes in the global economy, said Christine Lagarde, the European Central Bank (ECB) Chairman, Kommersant reports.
The global economy will change due to coronavirus - the executives of the European Central Bank

“The current sanitary crisis will become an amplifier of those transformations that have already latently occurred in our economies. It will lead to a profound change in entire economic system,” said Ms. Lagarde at the economic forum in Aix-en-Provence, France.

According to her, the pace of transformation will accelerate because of the pandemic, it will lead to a “more ecological and sustainable” lifestyle, and the nature of labor will also change. The use of digital technologies will expand in developed countries, the service sector in particular, and the scale of automation in industry will increase.

The European Central Bank will have to maintain an exceptionally soft monetary policy for some time and need to develop financial instruments that will finance the transformation of the economy, Lagarde said during a speech at the Rencontres Economiques d'Aix-en-Provence economic forum held online this year.

“The transition to new economic models will be devastating especially in the first two years. Employment and production will get in the firing line, but in the future we hope the productivity will improve,” Lagarde emphasized. According to several estimates, supply chains in the global economy will become shorter by around 35%, and the level of robotics will increase by 70-75%, she says.

Lagarde also noted a rapid growth of online trading during the lockdown period, when many people had to stay home. According to her, this trend will intensify to the detriment of traditional trade.

More than 11 million people worldwide have been infected with the coronavirus during a pandemic, according to Johns Hopkins University. 2.8 million people are in the USA, 1.5 million in Brazil, 674 thousand in Russia. The WHO representatives state that a new increase in the number of infected fixed in different countries should not be considered as a second epidemic wave, but as a second peak, since the virus has not been completely suppressed earlier.

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