Sergio P. Ermotti
On Europe’s sluggish growth: Sergio P. Ermotti stressed the fragmentation of Europe’s economy as a challenge to the region’s growth: “You have 27 countries, each of them has their own priority and agenda, and it’s quite difficult to get all of them to align on major projects nowadays.”
Ermotti stressed the bloc’s need to shift away from economies built overwhelmingly around strong social safety nets whereby “governments should take care of you from the day you are born to the day you are dying,” and toward growth-based strategies.
On why US economy has rebounded faster than Europe: “The flexibility in the US to act decisively when crises are coming is remarkable,” Ermotti said, stressing that this was the case during the financial crisis and during the COVID-19 pandemic. “The decisiveness of governments to step in and take concrete actions when necessary is the big difference.”
On the decline in globalization: “Slowing down the path of healthy globalization is potentially a big mistake,” Ermotti said, stressing that protectionism is becoming increasingly prevalent across the globe. “One could argue that this is not now a problem for goods and services, but it’s also starting to impact the flows of capital.”
“What we see is the inability of capital to go to those areas that need the most attention, and create value for more fragile economies,” he said. “Protectionism, if it goes too far, may create collateral damages” for both local economies as well as the banks that serve clients across the globe.