Kristen Lagarde, European Central Bank President Christine Lagarde, told European policy makers on Tuesday that the euro needed to become a real global player, Donald Trump has dragged the credibility of the US dollar into a trench.
In the opening, I wrote in Financial times“This is the moment of change, it is an opportunity for Europe: it is the moment of the” global euro “. She called for urgent action through the bloc to raise the role of the euro in the global financial system.
Christine said that the United States under Trump is away from the multilateral system that was used to support global trade. She pointed to a rise in “protectionism, zero thinking, and bilateral power plays”, warning that this trend is severely hitting Europe. With 30 million jobs associated with export, the European Union cannot sit while the global trading system is restructured.
Europe must fix the structural weaknesses to push the euro forward
Christine He said Euro is already the second most used currency in the world, with 20 percent of foreign exchange reserves. But the dollar, even during the Trump era, still controls 58 percent. She has made it clear that if Europe wants to bridge this gap, it needs to stop relying on America’s decline and start reforming its problems.
Three areas in which Europe lags behind: geopolitical credibility, economic flexibility, and institutional power. In trade, she said that the European Union is already the largest commercial partner for 72 countries, which represents about 40 percent of global GDP. However, the euro is used only for about 40 percent of bills in international deals. It urged the European Union to use this leverage and start cutting better trade agreements.
Christine said the European Central Bank is already helping by providing swap lines and linking the main global partners to prevent euro shortages abroad. But this is not enough to gain the required global confidence. “Investors are looking for areas whose alliances lie,” she wrote, adding that credibility alone can raise the currency share in foreign reserves by up to 30 percentage points.
Europe’s economy is another problem. Christine said the long -term growth of the European Union is still weak, and capital markets are still fragmented. She admitted that the total European Union debt – by 89 percent of GDP – is more healthy than 124 percent more to the United States. But providing high -class classification in Europe is small. She said that bonds only with AA classification at least reach less than 50 percent of GDP, while in the United States, it is more than 100 percent.
She called for bold steps to reform this: completed the unified market, reduce organizational barriers, and finally establishing a real union for capital markets. It also urged policies at the European Union to support the main sectors such as green energy and defense, and said that joint financing of public commodities such as military spending can help build safe assets that investors want.
The institutional changes needed to unify Europe’s financial voice
Christine said the investor’s confidence in the euro is also linked to the power of Europe’s institutions. She acknowledged that the European Union structure is confusing, but said that the slow and complex decision -making system still guarantees stability, the continuity of politics and the rule of law. She said that the independence of the European Central Bank is one of the most powerful origins of Europe, and it must be protected.
But she did not ignore political chaos. She attacked the system that allows one country to prohibit decisions that affect 27. She said that more voting for the majority in important areas to allow the European Union “to speak with one”.
She ended her article by reminding politicians that hegemony is never permanent. “History teaches us that the systems seem permanent – even no longer,” she said. Christine said this moment here, but it will not last forever. “To seize it and strengthen the role of the euro in the international monetary system, we must act decisively as the United Europe that controls its fate.”
The main difference wireCrypto Secret Tool projects are used to get guaranteed media coverage
