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[Music]

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[Applause]

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ladies and gentlemen

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welcome the moderator of the next

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session sonia muzikarova

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all right so uh good morning ladies and

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gentlemen and welcome to this session on

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strategic autonomy versus uh global

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supply

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how to secure value chain is what going

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what we're going to be talking about for

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the next about 45 minutes

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um just on a technical note as

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throughout the forum we'll be using

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slido to address some of your

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most pressing uh questions and we will

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be also

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engaging with you via live polls so

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please join the conversation

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you can do that in two ways either go to

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live.gobset.org

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or you can do it through the official

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globsec app

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where you'll be able to on the one hand

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submit a question but also

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upvote one at the end of this session

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there will be

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a q a um you can

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submit your question as i have said via

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slido but we can do it also

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old school in a physical way there is a

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standing mic over there so just please

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raise your hand

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um and yeah our great panel will answer

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answer your question so let me just warm

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up here a little bit and open up the

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conversation

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i think it's safe to say that disruption

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has been the late motive of this crisis

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it has upended our health systems our

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social systems the way we work

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live function school our kids but it has

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also disrupted

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cross-border production processes uh

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just in time

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manufacturing processes we have seen

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delays in the delivery of supply

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such as semiconductors microchips in in

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manufacturing

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sending customers in a waiting mode

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as a direct result of that we have been

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hearing with

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increased intensity and amplitude about

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things like decoupling production

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processes

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from china value chain shortening

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localization regionalization even

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nationalization of selected strategic

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industries

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especially in the context of the

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so-called

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eu strategic autonomy which has been

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also resonating throughout the

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the forum as a theme and basically

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that's the idea of a

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stronger more sovereign autonomous and

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self-sufficient

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europe this has contributed

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to some extent uh to a renewed

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impetus that globalization is somehow

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harmful or if not harmful it's a

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sub-optimal model for the global economy

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we have been hearing that and that its

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prime feature which are the

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overstretched cost-driven global value

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chains

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um increase our vulnerability to

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economic shocks

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so um these are some of the issues that

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i would like to debunk with our great

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panel that i will introduce in a bit

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today are global value chains as we have

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known them

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to date over to date over has the

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pandemic full-on appended the logic

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behind them or are we just

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witnessing a sort of transformation

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second how should we underpin and secure

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global value chains for greater

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robustness and resilience and third how

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should these aims be

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reflected in the policy landscape

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so as with the other panels we're in a

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hybrid mode today

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i will start with our virtual

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panelists we have with us today mr

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gordon baini who is the partner at

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kambelutens

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based off of london gordon do you hear

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me

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yes i hear you very well great thanks um

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next we have mr thomas wieser who is the

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eu representative to the g7 panel

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on economic resilience welcome thomas

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and hello to vienna

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thanks very much greetings thank you

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and next we have mr sebastian mirodo

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who is the senior trade policy analyst

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from the oecd

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normally based off of paris but i

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understand today you are not in paris

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sebastian

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right i'm in seoul in south korea today

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all right great and with me physically

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to my left

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we have mr mikhail krupinski who is a

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senior

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advisor at warburg pinkus llc

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based off of london hi michal and

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welcome

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all right so let us dive into the

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conversation and

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lay some groundwork here gordon i will

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start with you i would ask you to lay

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out and create a map of us

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for us of some of the key drivers of

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post covet d globalization

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and also what are some of the potential

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macroeconomic consequences for europe

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but also maybe specifically for the

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region of central and eastern europe

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since we know that this region is very

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closely knit

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in manufacturing global value chains

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please

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thank you very much sonia so first of

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all the disruption

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uh didn't start with covid and i would

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be very careful

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to base my analysis on on what happens

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because of kovid i believe that uh

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kovid has not changed the directions and

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trends that were

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already ongoing in the world what it

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means is

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it has accelerated significantly those

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trends that were pre-existing

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one of the most important of such trend

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is

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is

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a fight against or a return back from

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globalization

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there are domestic political reasons for

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that in many regions in the world in the

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united states as we see under the

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the emergence of donald trump and trump

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in them

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as a whole also china's

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status in the world is changing from a

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pure low cost manufacturer to a much

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more complex economic status moving away

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from an export-cloud economy

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these factors have been pre-existing

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kovid there is another even more

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important uh

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geopolitical shift which is that the

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united states now

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uh the hegemony the leading role of the

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united states in the world

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is is very seriously challenged by an

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emerging china

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this has been a long trend but this is

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not realized and that is leading the

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world towards

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uh less interdependence and more sort of

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bifurcation

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at the minimum now this is this was the

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underlying trend

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and globalization has taken a certain

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revenge on on

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employment and on the politics of these

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countries

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and what what discovery has accelerated

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is the tendency to turn back

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from that what is very typical after

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there is a global crisis is

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always the reaction is to solve the

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crisis is always on the shoulders of the

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given states nation states or regional

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governments

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like the eu and that typically means

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that the role of the state

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is increasing versus the private market

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actors this has happened after 2010

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and usually this increased role of the

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state is

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is quite sticky state is not easily

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walking back from its strengthened and

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augmented position

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uh when the crisis adds so it happened

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in 2010 and some of it is still alive

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and kovid has significantly

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strengthened this process of of making

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state states

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regulation stronger so the practical

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consequences for our world is

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in the coming years i would expect that

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uh state will be more important than

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private sectors that's completely

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different than the

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period between 1998 and 2010.

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state more important than private sector

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the second is

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strategy strategy considerations will be

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more important than efficiency

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that goes against the super efficiency

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just in time deliveries

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of the global economy strategic autonomy

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will be much more relevant if

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if europe realizes that more than 90 of

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our

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anti-fever appeals paracetamol pills are

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coming from india

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you may think it's not sustainable uh

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and you want to

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to bring it home just to give you a very

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simple uh example but think

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about chips produced in taiwan and and

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and the fight for the influence over

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over the taiwanese cheap manufacturing

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industry which is at the moment

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slowing down even car manufacturing just

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to say the most obvious thing

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so strategy will be more important than

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the global

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efficiency also in general in general

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regulation the power of regulation

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will overrule the forces of market much

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more

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than before we see it in for example tax

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changes that were just agreed uh by the

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g20 based on the oecd recommendations

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but if you think about data regulation

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in the world or or climate change

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related

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regulation these regulations are

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sometimes going against the pure

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business logic

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uh and that uh that is uh that is going

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to stay with us for for quite

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a while um and that will have an

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important

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impact on supply chains the so this the

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strategy

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the politic geopolitical strategy and

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the domestic political internal

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political considerations will mean

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that governments will overrule

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the global economy and try to focus on

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their regions i expect there will be

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three regions

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dominantly uh in the world china

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and its sir and its world if if china

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can

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find allies because china in the past

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had very big difficulties of of building

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long-term standing strategic alliances

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the other region

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where regionalization of industries and

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supply chains were concentrated is the

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us

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and its world and then there is a big

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question and it's a big task for all of

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us

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is whether europe can still become the

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third relevant region

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of concentration and focus in the world

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in this in this changing world europe's

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for the risk the stake for europe is

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to stay at the negotiating table

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where the rules in the world are set

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because there is an old saying in

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politics

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if you are if you don't sit at the table

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you will be on the menu

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and that's what europe should avoid

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thank you very much uh gordon but still

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to push us on this and set the record

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straight when it comes to the

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macroeconomic picture

291
00:11:08,959 --> 00:11:11,519
we do hear a lot of outcry about supply

292
00:11:11,519 --> 00:11:13,680
chain bottlenecks in the media and so on

293
00:11:13,680 --> 00:11:14,880
but at the same time

294
00:11:14,880 --> 00:11:18,000
the incoming information and data

295
00:11:18,000 --> 00:11:19,680
have been suggesting a very strong

296
00:11:19,680 --> 00:11:21,760
rebound in international trade both in

297
00:11:21,760 --> 00:11:23,200
imports and exports

298
00:11:23,200 --> 00:11:25,040
and not only in one region of the world

299
00:11:25,040 --> 00:11:26,240
for example in

300
00:11:26,240 --> 00:11:28,399
china or taiwan but also across the

301
00:11:28,399 --> 00:11:29,839
board in the u.s

302
00:11:29,839 --> 00:11:32,959
in the euro zone as well which is seems

303
00:11:32,959 --> 00:11:34,320
to be recovering and

304
00:11:34,320 --> 00:11:37,920
faring pretty well so also on top of

305
00:11:37,920 --> 00:11:38,320
this

306
00:11:38,320 --> 00:11:40,240
new information the oecd and other

307
00:11:40,240 --> 00:11:41,760
international organization have been

308
00:11:41,760 --> 00:11:42,959
revising up their

309
00:11:42,959 --> 00:11:45,920
uh global global global forecasts and

310
00:11:45,920 --> 00:11:46,560
other

311
00:11:46,560 --> 00:11:49,760
macroeconomic variables so how do we

312
00:11:49,760 --> 00:11:53,040
actually square this strong trade

313
00:11:53,040 --> 00:11:55,200
rebound with these supposedly

314
00:11:55,200 --> 00:11:57,360
appended global value chains it's to

315
00:11:57,360 --> 00:11:59,519
some extent it's a bit counterintuitive

316
00:11:59,519 --> 00:12:01,360
sebastian can you bring us up to speed

317
00:12:01,360 --> 00:12:03,600
here

318
00:12:03,839 --> 00:12:06,639
yes i think we have to look at the

319
00:12:06,639 --> 00:12:07,839
sequencing and

320
00:12:07,839 --> 00:12:10,000
and what happens in since last year so

321
00:12:10,000 --> 00:12:12,240
when the when the pandemic started

322
00:12:12,240 --> 00:12:14,800
the main concern was really a collapse

323
00:12:14,800 --> 00:12:15,600
in trade

324
00:12:15,600 --> 00:12:18,959
uh many supply disruptions followed by a

325
00:12:18,959 --> 00:12:20,320
deep recession

326
00:12:20,320 --> 00:12:22,880
so the lockdown of the chinese economy

327
00:12:22,880 --> 00:12:25,440
in february 2020

328
00:12:25,440 --> 00:12:27,680
sends a signal that somehow global

329
00:12:27,680 --> 00:12:28,560
production

330
00:12:28,560 --> 00:12:31,200
could come to a halt and at this time

331
00:12:31,200 --> 00:12:31,600
maybe

332
00:12:31,600 --> 00:12:34,720
government in the eu or in the u.s

333
00:12:34,720 --> 00:12:37,519
did not expect to be hit by the pandemic

334
00:12:37,519 --> 00:12:39,279
so the concern was really that

335
00:12:39,279 --> 00:12:41,600
production would be disrupted because

336
00:12:41,600 --> 00:12:43,920
there would be no access to inputs from

337
00:12:43,920 --> 00:12:47,200
asia but the chinese lockdown was

338
00:12:47,200 --> 00:12:50,959
rather short and progressively

339
00:12:50,959 --> 00:12:53,600
all economies were affected by the

340
00:12:53,600 --> 00:12:54,560
pandemic

341
00:12:54,560 --> 00:12:57,360
the pandemic created many disruptions in

342
00:12:57,360 --> 00:12:58,079
trade

343
00:12:58,079 --> 00:13:01,440
in particular in the transport networks

344
00:13:01,440 --> 00:13:04,320
due to the quarantine rules also the

345
00:13:04,320 --> 00:13:06,160
reduction in air cargo

346
00:13:06,160 --> 00:13:07,839
that was supplied through through

347
00:13:07,839 --> 00:13:09,519
passenger flights

348
00:13:09,519 --> 00:13:11,360
but it at the end it's not global

349
00:13:11,360 --> 00:13:13,680
manufacturing that was the most affected

350
00:13:13,680 --> 00:13:16,480
and not asia where somehow governments

351
00:13:16,480 --> 00:13:18,000
on average let's say we're more

352
00:13:18,000 --> 00:13:20,560
successful to contain the pandemic than

353
00:13:20,560 --> 00:13:21,360
government

354
00:13:21,360 --> 00:13:23,360
in the rest of the world so the main

355
00:13:23,360 --> 00:13:26,000
impact of kobe 19 has really been a

356
00:13:26,000 --> 00:13:26,720
shift

357
00:13:26,720 --> 00:13:28,880
in demand not just a reduction or

358
00:13:28,880 --> 00:13:30,079
decrease in demand

359
00:13:30,079 --> 00:13:32,079
there was an important increase in the

360
00:13:32,079 --> 00:13:34,320
demand for for the goods needed to fight

361
00:13:34,320 --> 00:13:35,839
the pandemic

362
00:13:35,839 --> 00:13:38,480
of course medical goods such as a face

363
00:13:38,480 --> 00:13:39,040
mask

364
00:13:39,040 --> 00:13:41,199
ventilators or more recently the

365
00:13:41,199 --> 00:13:42,079
vaccines

366
00:13:42,079 --> 00:13:43,680
but the the lockdowns and the

367
00:13:43,680 --> 00:13:45,199
stay-at-home policies

368
00:13:45,199 --> 00:13:48,320
have also shifted demand from the

369
00:13:48,320 --> 00:13:50,480
in-person services you can think about

370
00:13:50,480 --> 00:13:53,360
the restaurants scattering services

371
00:13:53,360 --> 00:13:56,240
entertainment air racing and so on to

372
00:13:56,240 --> 00:13:58,240
the goods and services you need

373
00:13:58,240 --> 00:14:00,480
when you work from home so such as i.t

374
00:14:00,480 --> 00:14:01,360
goods

375
00:14:01,360 --> 00:14:03,920
e-commerce or delivery services so

376
00:14:03,920 --> 00:14:06,240
global value chains have adjusted

377
00:14:06,240 --> 00:14:08,240
and there was even a trade boom for

378
00:14:08,240 --> 00:14:09,360
these products

379
00:14:09,360 --> 00:14:12,800
in the second half of 2020. we have seen

380
00:14:12,800 --> 00:14:15,120
more trade and more reliance on global

381
00:14:15,120 --> 00:14:17,120
value chains because the in-person

382
00:14:17,120 --> 00:14:17,920
services

383
00:14:17,920 --> 00:14:20,959
that were less demanded are kind of

384
00:14:20,959 --> 00:14:22,720
services because they are services they

385
00:14:22,720 --> 00:14:23,839
are less traded

386
00:14:23,839 --> 00:14:26,320
while the medical products the i.t goods

387
00:14:26,320 --> 00:14:26,880
involve

388
00:14:26,880 --> 00:14:29,519
trade and gvc's so we had an economic

389
00:14:29,519 --> 00:14:31,199
shock we had a recession but we have

390
00:14:31,199 --> 00:14:33,519
this paradox of having more trade but

391
00:14:33,519 --> 00:14:34,240
really

392
00:14:34,240 --> 00:14:37,360
for for a very limited set of products

393
00:14:37,360 --> 00:14:40,160
so today we we can say that gbc's have

394
00:14:40,160 --> 00:14:42,079
been rather resilient in the sense that

395
00:14:42,079 --> 00:14:43,600
they have recovered quickly

396
00:14:43,600 --> 00:14:46,160
even after this extraordinary shock that

397
00:14:46,160 --> 00:14:47,760
was a conv19 so

398
00:14:47,760 --> 00:14:49,680
it confirms what we've seen in the past

399
00:14:49,680 --> 00:14:51,040
for example after the

400
00:14:51,040 --> 00:14:53,040
the earthquake and tsunami in japan in

401
00:14:53,040 --> 00:14:54,160
2011

402
00:14:54,160 --> 00:14:56,639
all the fluids in thailand the same year

403
00:14:56,639 --> 00:14:59,040
so we have to understand that resilience

404
00:14:59,040 --> 00:15:00,959
is not about avoiding disruptions

405
00:15:00,959 --> 00:15:01,519
because

406
00:15:01,519 --> 00:15:04,079
whatever you do you will face crisis but

407
00:15:04,079 --> 00:15:04,639
it's about

408
00:15:04,639 --> 00:15:07,360
recovering quickly but the type of

409
00:15:07,360 --> 00:15:09,279
disruptions that the gbc's

410
00:15:09,279 --> 00:15:12,160
are still struggling with today are not

411
00:15:12,160 --> 00:15:12,959
so much about

412
00:15:12,959 --> 00:15:15,360
inputs not delivered but simply the the

413
00:15:15,360 --> 00:15:16,639
challenge of uh

414
00:15:16,639 --> 00:15:18,959
increasing production you know it was a

415
00:15:18,959 --> 00:15:21,120
story at the beginning of the pandemic

416
00:15:21,120 --> 00:15:22,160
for face mask

417
00:15:22,160 --> 00:15:23,920
it's still the story today for the

418
00:15:23,920 --> 00:15:26,160
vaccines and beyond medical products

419
00:15:26,160 --> 00:15:27,760
that it was mentioned it's also

420
00:15:27,760 --> 00:15:30,639
the issue with semiconductors now but to

421
00:15:30,639 --> 00:15:31,279
quickly

422
00:15:31,279 --> 00:15:33,759
ramp up production i really believe you

423
00:15:33,759 --> 00:15:35,680
need this global value chain when

424
00:15:35,680 --> 00:15:37,360
if you think about the vaccine they are

425
00:15:37,360 --> 00:15:40,000
really a gbc story with cooperation

426
00:15:40,000 --> 00:15:41,600
among different films in different

427
00:15:41,600 --> 00:15:43,040
countries it would not have been

428
00:15:43,040 --> 00:15:45,279
possible to develop these vaccines so

429
00:15:45,279 --> 00:15:46,240
quickly

430
00:15:46,240 --> 00:15:48,320
and to produce them at a large scale

431
00:15:48,320 --> 00:15:50,240
without a global production but of

432
00:15:50,240 --> 00:15:51,680
course it's still not enough

433
00:15:51,680 --> 00:15:56,000
so there are policy questions

434
00:15:56,000 --> 00:15:58,000
but i would think that the alternative

435
00:15:58,000 --> 00:16:00,639
and relying less on gvcs would have put

436
00:16:00,639 --> 00:16:01,040
us

437
00:16:01,040 --> 00:16:03,199
in a worse situation than where we are

438
00:16:03,199 --> 00:16:04,720
now

439
00:16:04,720 --> 00:16:07,040
thank you very much uh sebastian turning

440
00:16:07,040 --> 00:16:08,399
now to my

441
00:16:08,399 --> 00:16:11,360
only physical panelist and partner in

442
00:16:11,360 --> 00:16:12,079
crime

443
00:16:12,079 --> 00:16:15,120
mikhail you're an advisor to a global

444
00:16:15,120 --> 00:16:16,880
private equity firm

445
00:16:16,880 --> 00:16:18,720
and your mission centers on building

446
00:16:18,720 --> 00:16:21,759
durable companies with sustainable value

447
00:16:21,759 --> 00:16:23,199
when you square this objective of

448
00:16:23,199 --> 00:16:24,880
building durable companies with

449
00:16:24,880 --> 00:16:26,959
what we have seen on the global value

450
00:16:26,959 --> 00:16:28,399
chain front but also

451
00:16:28,399 --> 00:16:30,000
with the macro picture that we have

452
00:16:30,000 --> 00:16:32,240
discussed that has been presented

453
00:16:32,240 --> 00:16:34,320
how do you square this do global value

454
00:16:34,320 --> 00:16:36,959
chains actually require a major overhaul

455
00:16:36,959 --> 00:16:39,279
to achieve this mission

456
00:16:39,279 --> 00:16:42,000
yeah thank you very much sonia and maybe

457
00:16:42,000 --> 00:16:42,639
before i

458
00:16:42,639 --> 00:16:45,199
i respond directly to the question let

459
00:16:45,199 --> 00:16:47,120
me make a couple of comments

460
00:16:47,120 --> 00:16:49,199
my perspective is also a perspective of

461
00:16:49,199 --> 00:16:50,959
someone who was at the

462
00:16:50,959 --> 00:16:52,639
the board of the world bank during the

463
00:16:52,639 --> 00:16:54,800
past global financial crisis this crisis

464
00:16:54,800 --> 00:16:56,079
was different

465
00:16:56,079 --> 00:16:58,079
because it was self-inflicted with

466
00:16:58,079 --> 00:17:00,959
lockdown to a big degree

467
00:17:00,959 --> 00:17:03,680
and the response was different but but

468
00:17:03,680 --> 00:17:04,000
first

469
00:17:04,000 --> 00:17:07,119
of all as uh prime minister

470
00:17:07,119 --> 00:17:09,679
belnae was saying i think what we saw

471
00:17:09,679 --> 00:17:10,319
last year

472
00:17:10,319 --> 00:17:12,640
is nothing new it's just a reflection of

473
00:17:12,640 --> 00:17:14,880
economic reality

474
00:17:14,880 --> 00:17:16,640
where you do have a lot of regions in

475
00:17:16,640 --> 00:17:18,720
the world that simply

476
00:17:18,720 --> 00:17:20,400
are no longer strong in terms of

477
00:17:20,400 --> 00:17:23,199
manufacturing

478
00:17:23,199 --> 00:17:26,000
what we saw was a big surge in demand

479
00:17:26,000 --> 00:17:26,400
and

480
00:17:26,400 --> 00:17:30,960
in my personal view a

481
00:17:30,960 --> 00:17:34,480
delayed policy response and a delayed

482
00:17:34,480 --> 00:17:35,200
response

483
00:17:35,200 --> 00:17:38,640
from many governments in terms of uh

484
00:17:38,640 --> 00:17:40,640
making sure that the medical supplies

485
00:17:40,640 --> 00:17:41,840
are there

486
00:17:41,840 --> 00:17:43,360
you know this reminds me there was a

487
00:17:43,360 --> 00:17:45,280
quite a bit a small scandal in

488
00:17:45,280 --> 00:17:46,640
switzerland

489
00:17:46,640 --> 00:17:50,160
where they ask a 21 year old person

490
00:17:50,160 --> 00:17:53,280
who actually delivered most a lot of

491
00:17:53,280 --> 00:17:54,720
medical equipment to

492
00:17:54,720 --> 00:17:57,039
some of the governments in europe i said

493
00:17:57,039 --> 00:17:58,880
you know how come did you do that and he

494
00:17:58,880 --> 00:18:01,600
was saying i was just watching tv

495
00:18:01,600 --> 00:18:05,120
in december of 2019 and i saw people

496
00:18:05,120 --> 00:18:06,720
wearing masks in china

497
00:18:06,720 --> 00:18:08,320
and i come to a conclusion that this

498
00:18:08,320 --> 00:18:10,160
will come to europe and that's why

499
00:18:10,160 --> 00:18:13,120
i bought quite a bit big shipment so

500
00:18:13,120 --> 00:18:14,559
what happened was

501
00:18:14,559 --> 00:18:16,240
many of the governments simply didn't

502
00:18:16,240 --> 00:18:18,880
see it and and that's why there was this

503
00:18:18,880 --> 00:18:20,400
panic effect

504
00:18:20,400 --> 00:18:22,720
which for me also speaks to the fact

505
00:18:22,720 --> 00:18:24,640
that you do not have

506
00:18:24,640 --> 00:18:28,400
uh proper coordination and as we all

507
00:18:28,400 --> 00:18:29,039
know

508
00:18:29,039 --> 00:18:32,240
all of us who studied eu

509
00:18:32,240 --> 00:18:34,799
um we do not have proper coordination

510
00:18:34,799 --> 00:18:36,400
and policies in terms of

511
00:18:36,400 --> 00:18:39,200
health current security on the eu level

512
00:18:39,200 --> 00:18:41,520
and what we have seen is to a big degree

513
00:18:41,520 --> 00:18:44,559
the eu going from one extreme to another

514
00:18:44,559 --> 00:18:46,799
which is uh you know moving from a

515
00:18:46,799 --> 00:18:49,200
deficit of supplies to a surplus

516
00:18:49,200 --> 00:18:51,360
moving from a deficit of vaccines to

517
00:18:51,360 --> 00:18:54,320
surplus of vaccines

518
00:18:54,320 --> 00:18:58,080
etc etc but i think the impact

519
00:18:58,080 --> 00:19:01,840
will be profound um unfortunately it was

520
00:19:01,840 --> 00:19:04,880
it was to a big degree self-inflicted

521
00:19:04,880 --> 00:19:06,880
the panel is not about the rationale of

522
00:19:06,880 --> 00:19:08,720
lockdowns my view is after chinese

523
00:19:08,720 --> 00:19:09,440
lockdown

524
00:19:09,440 --> 00:19:11,919
there was no other way for governments

525
00:19:11,919 --> 00:19:14,080
not to introduce lockdowns but bear in

526
00:19:14,080 --> 00:19:14,720
mind

527
00:19:14,720 --> 00:19:17,679
that this huge stage state intervention

528
00:19:17,679 --> 00:19:19,679
which is unparalleled it's much bigger

529
00:19:19,679 --> 00:19:22,080
than during the global financial crisis

530
00:19:22,080 --> 00:19:24,240
in terms of people saying you know 15

531
00:19:24,240 --> 00:19:26,559
trillion pump into the global economy

532
00:19:26,559 --> 00:19:29,200
which certainly led to a bubble of

533
00:19:29,200 --> 00:19:29,840
everything

534
00:19:29,840 --> 00:19:32,720
asset price bubbles last year as we also

535
00:19:32,720 --> 00:19:33,120
with

536
00:19:33,120 --> 00:19:36,400
you know all across the board this will

537
00:19:36,400 --> 00:19:38,320
lead to increased inflation as well as

538
00:19:38,320 --> 00:19:39,360
inequality

539
00:19:39,360 --> 00:19:42,320
going forward and particularly in what

540
00:19:42,320 --> 00:19:43,360
we call

541
00:19:43,360 --> 00:19:46,640
uh western where europe and um and the

542
00:19:46,640 --> 00:19:47,679
us

543
00:19:47,679 --> 00:19:49,840
of course the travel is it was to a big

544
00:19:49,840 --> 00:19:50,799
big degree

545
00:19:50,799 --> 00:19:53,440
uh self-inflicted now two last points

546
00:19:53,440 --> 00:19:54,799
and i answer your question

547
00:19:54,799 --> 00:19:57,440
um so first of all what does it mean

548
00:19:57,440 --> 00:19:59,760
mean for europe i find an increased

549
00:19:59,760 --> 00:20:03,200
rationale for for coordination

550
00:20:03,200 --> 00:20:05,280
in terms of healthcare policies because

551
00:20:05,280 --> 00:20:06,880
you did see

552
00:20:06,880 --> 00:20:09,600
you know vans being stopped on borders

553
00:20:09,600 --> 00:20:11,200
of eu countries

554
00:20:11,200 --> 00:20:14,320
which very much spoke to the lack of

555
00:20:14,320 --> 00:20:17,039
proper solidarity in europe secondly for

556
00:20:17,039 --> 00:20:18,559
central eastern europe i think it's

557
00:20:18,559 --> 00:20:19,360
actually good news

558
00:20:19,360 --> 00:20:21,679
because when i talk to investors is

559
00:20:21,679 --> 00:20:22,559
first of all

560
00:20:22,559 --> 00:20:23,919
you know we are here in the part of the

561
00:20:23,919 --> 00:20:25,440
world where we think it still makes

562
00:20:25,440 --> 00:20:26,880
sense to manufacture

563
00:20:26,880 --> 00:20:28,720
which is a good thing and not everyone

564
00:20:28,720 --> 00:20:31,039
thinks this way in the world

565
00:20:31,039 --> 00:20:34,240
and secondly people

566
00:20:34,240 --> 00:20:36,559
people it's it's you know it's all we

567
00:20:36,559 --> 00:20:38,799
all have well short memories

568
00:20:38,799 --> 00:20:41,280
but many investors ask themselves

569
00:20:41,280 --> 00:20:42,880
questions in terms of

570
00:20:42,880 --> 00:20:45,919
how how they allocate capital uh

571
00:20:45,919 --> 00:20:49,200
particularly those who invest and can

572
00:20:49,200 --> 00:20:51,120
allocate in manufacturing

573
00:20:51,120 --> 00:20:55,039
in manufacturing globally and apart from

574
00:20:55,039 --> 00:20:56,400
you know where it makes sense from a

575
00:20:56,400 --> 00:20:59,080
cost perspective a more

576
00:20:59,080 --> 00:21:01,520
diversification approach is actually at

577
00:21:01,520 --> 00:21:02,240
play

578
00:21:02,240 --> 00:21:03,840
which i think will mean increase

579
00:21:03,840 --> 00:21:05,760
investments in this part

580
00:21:05,760 --> 00:21:08,559
in this part of the world so i think it

581
00:21:08,559 --> 00:21:09,039
is

582
00:21:09,039 --> 00:21:10,960
it is positive and now to answer your

583
00:21:10,960 --> 00:21:12,640
question of course i think

584
00:21:12,640 --> 00:21:14,720
i think what what will be happening is

585
00:21:14,720 --> 00:21:16,480
every rational

586
00:21:16,480 --> 00:21:19,200
business person will be taking a view

587
00:21:19,200 --> 00:21:20,159
around

588
00:21:20,159 --> 00:21:23,200
around the business continuity

589
00:21:23,200 --> 00:21:27,039
around the uh durability

590
00:21:27,039 --> 00:21:29,440
of existing business models for all

591
00:21:29,440 --> 00:21:30,559
companies

592
00:21:30,559 --> 00:21:33,200
so i think all businesses are affected

593
00:21:33,200 --> 00:21:35,039
and whenever you analyze a business you

594
00:21:35,039 --> 00:21:37,039
run a business you have to take a view

595
00:21:37,039 --> 00:21:38,559
and say

596
00:21:38,559 --> 00:21:42,159
what if it happens again right so we do

597
00:21:42,159 --> 00:21:42,640
have

598
00:21:42,640 --> 00:21:45,760
events which are sort of fat tail

599
00:21:45,760 --> 00:21:48,400
bear curve events but they do happen and

600
00:21:48,400 --> 00:21:48,960
i think

601
00:21:48,960 --> 00:21:50,880
it's uh it's in this regard it is a

602
00:21:50,880 --> 00:21:52,480
lesson for everyone and it is a lesson

603
00:21:52,480 --> 00:21:53,600
also for

604
00:21:53,600 --> 00:21:56,720
for investors thank you very much uh

605
00:21:56,720 --> 00:21:58,480
switching gears now a little bit

606
00:21:58,480 --> 00:22:01,440
from um the business side to the policy

607
00:22:01,440 --> 00:22:03,919
side and this is a question for thomas

608
00:22:03,919 --> 00:22:06,159
uh thomas from your viewpoint as a eu

609
00:22:06,159 --> 00:22:08,159
representative to the g7 panel on

610
00:22:08,159 --> 00:22:09,679
economic resilience a very

611
00:22:09,679 --> 00:22:12,720
pertinent uh role for this debate

612
00:22:12,720 --> 00:22:15,520
can in your view global value chains be

613
00:22:15,520 --> 00:22:17,679
redesigned for greater resilience and

614
00:22:17,679 --> 00:22:20,000
what's the role of policy here

615
00:22:20,000 --> 00:22:23,200
both perhaps national regional

616
00:22:23,200 --> 00:22:26,559
and global not an easy question but

617
00:22:26,559 --> 00:22:29,200
necessary

618
00:22:29,840 --> 00:22:33,200
thanks very much sonia and i think it's

619
00:22:33,200 --> 00:22:34,720
good that you don't frame it in the

620
00:22:34,720 --> 00:22:37,120
context of the pandemic

621
00:22:37,120 --> 00:22:39,679
because just as an example as far as we

622
00:22:39,679 --> 00:22:41,440
know the evergreen didn't get stuck in

623
00:22:41,440 --> 00:22:43,520
the suez canal

624
00:22:43,520 --> 00:22:46,400
because it had contracted the virus but

625
00:22:46,400 --> 00:22:46,960
for

626
00:22:46,960 --> 00:22:50,159
other reasons and the effects were of

627
00:22:50,159 --> 00:22:50,880
course

628
00:22:50,880 --> 00:22:54,720
quite spectacular and

629
00:22:54,720 --> 00:22:58,080
when we were looking at reasons

630
00:22:58,080 --> 00:23:02,000
and police possible policy responses

631
00:23:02,000 --> 00:23:06,000
we have remarked that most global value

632
00:23:06,000 --> 00:23:07,440
chains have shown

633
00:23:07,440 --> 00:23:10,400
a fairly significant resilience and

634
00:23:10,400 --> 00:23:12,480
dynamism also

635
00:23:12,480 --> 00:23:15,679
during the pandemic but that

636
00:23:15,679 --> 00:23:18,400
the recent events have highlighted the

637
00:23:18,400 --> 00:23:19,200
gap

638
00:23:19,200 --> 00:23:23,200
in our collective risk identification

639
00:23:23,200 --> 00:23:26,559
mechanisms and in the resilience

640
00:23:26,559 --> 00:23:30,480
of certain sectors which are critical

641
00:23:30,480 --> 00:23:32,880
to public goods such as health or

642
00:23:32,880 --> 00:23:34,480
security

643
00:23:34,480 --> 00:23:37,520
or uh environment

644
00:23:37,520 --> 00:23:41,919
and uh because there has been a lack in

645
00:23:41,919 --> 00:23:42,360
risk

646
00:23:42,360 --> 00:23:45,679
identification uh there was a

647
00:23:45,679 --> 00:23:50,400
significant lack in preparedness

648
00:23:50,400 --> 00:23:53,840
so uh many of

649
00:23:53,840 --> 00:23:57,039
many countries and i think the g7 are at

650
00:23:57,039 --> 00:23:58,320
the forefront there

651
00:23:58,320 --> 00:24:01,200
many countries uh are having a critical

652
00:24:01,200 --> 00:24:02,400
look

653
00:24:02,400 --> 00:24:04,640
at their national approaches on how to

654
00:24:04,640 --> 00:24:06,720
address these challenges

655
00:24:06,720 --> 00:24:08,960
uh there is of course always the danger

656
00:24:08,960 --> 00:24:10,400
as already mentioned

657
00:24:10,400 --> 00:24:12,720
uh that you tried to solve the last

658
00:24:12,720 --> 00:24:14,720
crisis and not the next one

659
00:24:14,720 --> 00:24:17,919
even though everybody is saying uh next

660
00:24:17,919 --> 00:24:19,520
prices will be different we don't know

661
00:24:19,520 --> 00:24:21,440
where it's coming from but nevertheless

662
00:24:21,440 --> 00:24:24,559
the approaches tend uh to piggyback

663
00:24:24,559 --> 00:24:27,120
uh on uh solutions found uh over the

664
00:24:27,120 --> 00:24:28,720
last crisis but

665
00:24:28,720 --> 00:24:32,000
uh the point is uh that true

666
00:24:32,000 --> 00:24:34,640
uh resilience uh in the view of the

667
00:24:34,640 --> 00:24:35,279
panel

668
00:24:35,279 --> 00:24:38,480
uh which just reported to g7 leaders

669
00:24:38,480 --> 00:24:42,000
true resilience does arise from reliable

670
00:24:42,000 --> 00:24:45,919
and diverse and co-dependent global

671
00:24:45,919 --> 00:24:48,400
supply chains

672
00:24:48,400 --> 00:24:51,200
and that presupposes of course a high

673
00:24:51,200 --> 00:24:52,080
degree

674
00:24:52,080 --> 00:24:55,520
of openness a high degree

675
00:24:55,520 --> 00:24:58,720
of underwriting fair degrees

676
00:24:58,720 --> 00:25:02,960
of competition and that is why

677
00:25:02,960 --> 00:25:06,000
one shouldn't now panic

678
00:25:06,000 --> 00:25:10,480
and move to policies of trying to

679
00:25:10,480 --> 00:25:12,720
duplicate each and every potentially

680
00:25:12,720 --> 00:25:14,480
critical sector

681
00:25:14,480 --> 00:25:17,840
in every part of the world

682
00:25:17,840 --> 00:25:20,640
but there are certain sectors where

683
00:25:20,640 --> 00:25:23,840
there is a convergence of criticality

684
00:25:23,840 --> 00:25:27,200
on the one hand public goods that i've

685
00:25:27,200 --> 00:25:28,240
mentioned

686
00:25:28,240 --> 00:25:31,919
and vulnerability on the other hand

687
00:25:31,919 --> 00:25:34,559
now where do these vulnerabilities stem

688
00:25:34,559 --> 00:25:35,120
from

689
00:25:35,120 --> 00:25:38,159
some of them have already been mentioned

690
00:25:38,159 --> 00:25:39,440
and i think we need to make the

691
00:25:39,440 --> 00:25:42,240
distinction a very clear distinction

692
00:25:42,240 --> 00:25:45,679
between manufacturing sectors and

693
00:25:45,679 --> 00:25:48,480
service sectors especially new

694
00:25:48,480 --> 00:25:49,840
technologies

695
00:25:49,840 --> 00:25:53,919
and in manufacturing indeed we have seen

696
00:25:53,919 --> 00:25:57,039
for reasons of politicization

697
00:25:57,039 --> 00:26:00,400
of trade weaponization of trade

698
00:26:00,400 --> 00:26:04,159
a ticking up not least under the form of

699
00:26:04,159 --> 00:26:06,080
president trump a ticking up

700
00:26:06,080 --> 00:26:09,679
of protectionist measures

701
00:26:09,679 --> 00:26:13,120
we have seen the

702
00:26:13,120 --> 00:26:16,799
issue that systemic convergence

703
00:26:16,799 --> 00:26:19,520
which was the hope of many when china

704
00:26:19,520 --> 00:26:21,279
joined the wto

705
00:26:21,279 --> 00:26:23,440
systemic convergence has not come about

706
00:26:23,440 --> 00:26:24,880
but has

707
00:26:24,880 --> 00:26:28,000
rather shown we have rather seen

708
00:26:28,000 --> 00:26:28,960
systemic

709
00:26:28,960 --> 00:26:32,559
divergence and therefore

710
00:26:32,559 --> 00:26:35,279
fair degrees of fair conditions of

711
00:26:35,279 --> 00:26:37,279
competition with state-owned

712
00:26:37,279 --> 00:26:40,720
enterprises have more and more

713
00:26:40,720 --> 00:26:43,600
moved to the forefront of discussions

714
00:26:43,600 --> 00:26:45,919
and this will be exacerbated

715
00:26:45,919 --> 00:26:48,720
as we move into policies which are

716
00:26:48,720 --> 00:26:49,679
necessary

717
00:26:49,679 --> 00:26:52,880
i.e carbon pricing how can we live

718
00:26:52,880 --> 00:26:55,919
in a world where there is no uh globally

719
00:26:55,919 --> 00:26:58,400
agreed principle of carbon pricing

720
00:26:58,400 --> 00:27:00,960
it will lead to certain border measures

721
00:27:00,960 --> 00:27:02,480
which inevitably

722
00:27:02,480 --> 00:27:05,200
will give rise to tensions that's as far

723
00:27:05,200 --> 00:27:05,919
as

724
00:27:05,919 --> 00:27:08,320
manufacturing is concerned but on new

725
00:27:08,320 --> 00:27:09,440
technologies

726
00:27:09,440 --> 00:27:13,120
i see a significantly more pronounced

727
00:27:13,120 --> 00:27:14,000
trend

728
00:27:14,000 --> 00:27:17,279
on decoupling not least because of the

729
00:27:17,279 --> 00:27:19,600
monopolistic market structures that are

730
00:27:19,600 --> 00:27:23,679
inherent in many of these sectors

731
00:27:23,679 --> 00:27:26,880
the issue of data privacy the issue of

732
00:27:26,880 --> 00:27:28,480
data governance

733
00:27:28,480 --> 00:27:32,240
and who is the driving force

734
00:27:32,240 --> 00:27:36,320
behind developing standards and rules

735
00:27:36,320 --> 00:27:38,960
and that is the clear the clearest

736
00:27:38,960 --> 00:27:39,919
danger

737
00:27:39,919 --> 00:27:43,520
that i see to a

738
00:27:43,520 --> 00:27:46,559
jointly run governed

739
00:27:46,559 --> 00:27:50,159
rules based international global open

740
00:27:50,159 --> 00:27:53,440
trading system namely

741
00:27:53,440 --> 00:27:56,720
uh that we move uh into an era where

742
00:27:56,720 --> 00:27:59,919
there might conceivably even uh be two

743
00:27:59,919 --> 00:28:03,440
sets of standards and

744
00:28:03,440 --> 00:28:06,960
that would be uh lethal it might start

745
00:28:06,960 --> 00:28:11,039
from uh the area of new technologies

746
00:28:11,039 --> 00:28:14,399
but inevitably it would morph over into

747
00:28:14,399 --> 00:28:15,120
trade

748
00:28:15,120 --> 00:28:18,880
in goods and some other services

749
00:28:18,880 --> 00:28:21,919
so what can one uh do

750
00:28:21,919 --> 00:28:25,440
i think one needs to one

751
00:28:25,440 --> 00:28:28,159
recognize that these systemic

752
00:28:28,159 --> 00:28:29,120
divergences

753
00:28:29,120 --> 00:28:30,880
and differences will persist for the

754
00:28:30,880 --> 00:28:32,559
foreseeable future

755
00:28:32,559 --> 00:28:36,480
and one somehow has to find an

756
00:28:36,480 --> 00:28:40,240
algorithm on how to coexist

757
00:28:40,240 --> 00:28:43,919
and compete peacefully with each other

758
00:28:43,919 --> 00:28:46,080
without shutting down

759
00:28:46,080 --> 00:28:48,799
the globalized trading system that has

760
00:28:48,799 --> 00:28:49,679
benefited

761
00:28:49,679 --> 00:28:52,960
all of us we need a better

762
00:28:52,960 --> 00:28:55,760
uh national and better international

763
00:28:55,760 --> 00:28:57,440
mechanisms and for

764
00:28:57,440 --> 00:29:01,200
to identify risks uh build for example

765
00:29:01,200 --> 00:29:03,360
common vulnerability

766
00:29:03,360 --> 00:29:06,480
indicators and methodologies share best

767
00:29:06,480 --> 00:29:07,360
practice

768
00:29:07,360 --> 00:29:10,159
and we need a forum that provides for

769
00:29:10,159 --> 00:29:13,120
policy coordination in times

770
00:29:13,120 --> 00:29:16,559
of in critical times that ensures

771
00:29:16,559 --> 00:29:19,919
a comparatively free flow of critical

772
00:29:19,919 --> 00:29:20,720
goods

773
00:29:20,720 --> 00:29:24,240
and services so

774
00:29:24,240 --> 00:29:26,799
therefore all things hang together uh

775
00:29:26,799 --> 00:29:27,840
there is a

776
00:29:27,840 --> 00:29:30,159
this provides another strong strong

777
00:29:30,159 --> 00:29:31,120
rationale

778
00:29:31,120 --> 00:29:34,240
uh for overhauling the wto

779
00:29:34,240 --> 00:29:36,240
a strong rationale for overhauling of

780
00:29:36,240 --> 00:29:38,240
course uh the w

781
00:29:38,240 --> 00:29:41,760
uh ho but if we look at supply chain

782
00:29:41,760 --> 00:29:44,000
resilience proper and that is what this

783
00:29:44,000 --> 00:29:45,279
panel is about

784
00:29:45,279 --> 00:29:48,320
uh we suggest that one focuses on three

785
00:29:48,320 --> 00:29:49,679
critical areas

786
00:29:49,679 --> 00:29:53,440
for now health critical minerals

787
00:29:53,440 --> 00:29:56,880
and semiconductors and

788
00:29:56,880 --> 00:30:00,640
one needs to branch out build out

789
00:30:00,640 --> 00:30:04,080
from the g7 from the g20

790
00:30:04,080 --> 00:30:07,520
to reach as many other countries as

791
00:30:07,520 --> 00:30:08,480
possible

792
00:30:08,480 --> 00:30:12,720
so as to build up global uh uh

793
00:30:12,720 --> 00:30:15,279
chain resilience if you so want policy

794
00:30:15,279 --> 00:30:16,159
resilience

795
00:30:16,159 --> 00:30:18,159
and for me that is one of the lessons

796
00:30:18,159 --> 00:30:19,840
which i take from looking at

797
00:30:19,840 --> 00:30:22,799
around europe there has been over the

798
00:30:22,799 --> 00:30:24,960
years and over the decades

799
00:30:24,960 --> 00:30:28,720
a uh progressively weakening

800
00:30:28,720 --> 00:30:31,840
of the capabilities capacities

801
00:30:31,840 --> 00:30:35,200
of the public sector very many uh

802
00:30:35,200 --> 00:30:37,919
of the administrations have been

803
00:30:37,919 --> 00:30:39,120
woefully

804
00:30:39,120 --> 00:30:41,440
uh unprepared and very very

805
00:30:41,440 --> 00:30:42,720
unprofessional

806
00:30:42,720 --> 00:30:45,440
so a strengthening of the quality of

807
00:30:45,440 --> 00:30:46,120
public

808
00:30:46,120 --> 00:30:50,080
administrations de-politicizing them

809
00:30:50,080 --> 00:30:53,279
would be of the essence and

810
00:30:53,279 --> 00:30:57,200
uh i'm afraid that the present

811
00:30:57,200 --> 00:30:59,760
sentiment uh in many parts of the world

812
00:30:59,760 --> 00:31:02,240
but unfortunately also in europe

813
00:31:02,240 --> 00:31:04,320
uh is not for de-politicizing and

814
00:31:04,320 --> 00:31:06,480
professionalizing these sectors

815
00:31:06,480 --> 00:31:09,360
but without that the next crisis uh will

816
00:31:09,360 --> 00:31:09,840
be

817
00:31:09,840 --> 00:31:12,559
uh will have just as hard ahead as the

818
00:31:12,559 --> 00:31:13,440
last pandemic

819
00:31:13,440 --> 00:31:16,159
thanks sonia thank you very much uh

820
00:31:16,159 --> 00:31:17,360
thomas for this

821
00:31:17,360 --> 00:31:19,120
reach account i think we have built a

822
00:31:19,120 --> 00:31:20,960
very nice groundwork here

823
00:31:20,960 --> 00:31:22,640
uh first talking about the driving

824
00:31:22,640 --> 00:31:24,799
factors behind the globalization

825
00:31:24,799 --> 00:31:27,039
uh then discussing the current picture

826
00:31:27,039 --> 00:31:28,720
the macro story here

827
00:31:28,720 --> 00:31:30,960
and then some of the private sector and

828
00:31:30,960 --> 00:31:32,480
policy

829
00:31:32,480 --> 00:31:35,519
responses i would like to pause here and

830
00:31:35,519 --> 00:31:39,200
launch uh slido actually our first poll

831
00:31:39,200 --> 00:31:41,200
so if that could uh come up on the

832
00:31:41,200 --> 00:31:42,399
screen

833
00:31:42,399 --> 00:31:44,880
uh and i would love for you and our

834
00:31:44,880 --> 00:31:45,679
virtual

835
00:31:45,679 --> 00:31:49,519
audiences as well to engage and

836
00:31:49,519 --> 00:31:52,720
answer the multiple choice question the

837
00:31:52,720 --> 00:31:55,279
most effective coping strategy

838
00:31:55,279 --> 00:31:56,399
multinational

839
00:31:56,399 --> 00:31:58,640
firms should use to minimize future

840
00:31:58,640 --> 00:32:00,399
disruptions such as the kovid 19

841
00:32:00,399 --> 00:32:01,279
pandemic

842
00:32:01,279 --> 00:32:04,000
of their supply is and you have four

843
00:32:04,000 --> 00:32:05,039
options

844
00:32:05,039 --> 00:32:07,120
shortening and streamlining their value

845
00:32:07,120 --> 00:32:08,240
chains

846
00:32:08,240 --> 00:32:10,960
diversifying their supply base going

847
00:32:10,960 --> 00:32:13,200
from global to regional

848
00:32:13,200 --> 00:32:15,519
concentrating their sourcing regionally

849
00:32:15,519 --> 00:32:18,159
and the no systemic step can word of a

850
00:32:18,159 --> 00:32:20,640
disruption of such skill and scope

851
00:32:20,640 --> 00:32:23,760
it'd be great if you could weigh in

852
00:32:23,760 --> 00:32:27,679
on that we'll wait a couple of minutes

853
00:32:27,679 --> 00:32:28,880
and we should see some

854
00:32:28,880 --> 00:32:33,039
first responses

855
00:32:33,200 --> 00:32:36,799
um hopefully on the screen

856
00:32:40,000 --> 00:32:44,640
great so um it seems to be pretty clear

857
00:32:44,640 --> 00:32:46,880
our audiences think that diversifying

858
00:32:46,880 --> 00:32:49,039
the supplier base of multinational

859
00:32:49,039 --> 00:32:50,240
companies

860
00:32:50,240 --> 00:32:53,440
is the most sensible approach

861
00:32:53,440 --> 00:32:56,799
uh but let's let's have our panelists

862
00:32:56,799 --> 00:33:00,240
weigh in here uh on that turning

863
00:33:00,240 --> 00:33:02,960
to sebastian again speaking of coping

864
00:33:02,960 --> 00:33:04,399
strategies you and your colleague

865
00:33:04,399 --> 00:33:05,279
sebastian

866
00:33:05,279 --> 00:33:07,200
uh have published an interesting paper

867
00:33:07,200 --> 00:33:08,559
and also an article

868
00:33:08,559 --> 00:33:11,760
on vox eu i believe debunking

869
00:33:11,760 --> 00:33:15,440
uh two qualities of value chains one is

870
00:33:15,440 --> 00:33:18,240
resilience and another one is robustness

871
00:33:18,240 --> 00:33:18,720
uh

872
00:33:18,720 --> 00:33:21,200
what is the difference and should they

873
00:33:21,200 --> 00:33:22,159
both be

874
00:33:22,159 --> 00:33:24,480
targeted by by on the one hand supply

875
00:33:24,480 --> 00:33:26,480
manager managers on the other hand by

876
00:33:26,480 --> 00:33:28,159
policy how does this fit into the

877
00:33:28,159 --> 00:33:31,600
overall debate and picture

878
00:33:32,320 --> 00:33:34,159
yeah so you can have different

879
00:33:34,159 --> 00:33:36,159
definitions of resilience but

880
00:33:36,159 --> 00:33:38,399
a common definition you find in

881
00:33:38,399 --> 00:33:40,159
particular in the business literature

882
00:33:40,159 --> 00:33:41,440
it's the capacity to

883
00:33:41,440 --> 00:33:44,320
recover quickly after some some

884
00:33:44,320 --> 00:33:46,080
large-scale disaster

885
00:33:46,080 --> 00:33:48,880
uh so in this sense gbc's have been

886
00:33:48,880 --> 00:33:50,000
resilient that's

887
00:33:50,000 --> 00:33:52,000
the experience of the of the pandemic

888
00:33:52,000 --> 00:33:53,679
but resilience in this sense does that

889
00:33:53,679 --> 00:33:55,760
mean that you you avoid disruptions or

890
00:33:55,760 --> 00:33:57,120
shortages

891
00:33:57,120 --> 00:33:59,120
just that it takes a shorter time to to

892
00:33:59,120 --> 00:34:01,279
recover or to solve the issue so

893
00:34:01,279 --> 00:34:03,679
for some essential goods and here you

894
00:34:03,679 --> 00:34:05,840
can think about the electricity or

895
00:34:05,840 --> 00:34:08,480
medicines or access to telecommunication

896
00:34:08,480 --> 00:34:09,119
networks

897
00:34:09,119 --> 00:34:11,040
it may not be enough just you know to

898
00:34:11,040 --> 00:34:12,159
recover quickly

899
00:34:12,159 --> 00:34:14,320
there should be some continuity of

900
00:34:14,320 --> 00:34:16,159
supply and this is what we

901
00:34:16,159 --> 00:34:18,560
we call robustness the capacity to

902
00:34:18,560 --> 00:34:20,159
continue to produce during

903
00:34:20,159 --> 00:34:23,199
a crisis i mean firms can can also work

904
00:34:23,199 --> 00:34:25,280
on their robustness and it can also be

905
00:34:25,280 --> 00:34:28,480
an objective for supply chain managers

906
00:34:28,480 --> 00:34:30,399
in particular when when this continuity

907
00:34:30,399 --> 00:34:32,560
of supplies is important for their

908
00:34:32,560 --> 00:34:33,359
consumers

909
00:34:33,359 --> 00:34:36,800
but i think that as thomas explained the

910
00:34:36,800 --> 00:34:39,839
there is certainly here maybe a role for

911
00:34:39,839 --> 00:34:40,960
governments

912
00:34:40,960 --> 00:34:44,239
to help firms to ensure the continuity

913
00:34:44,239 --> 00:34:47,599
of supply through specific

914
00:34:47,599 --> 00:34:50,320
regulations uh in particular addressing

915
00:34:50,320 --> 00:34:50,800
maybe

916
00:34:50,800 --> 00:34:53,599
the cost and the economic incentives uh

917
00:34:53,599 --> 00:34:54,000
to

918
00:34:54,000 --> 00:34:56,399
for for films to be in a position to

919
00:34:56,399 --> 00:34:58,560
continue to supply during the crisis

920
00:34:58,560 --> 00:35:00,800
it can be also through stocks buys

921
00:35:00,800 --> 00:35:02,880
strategic stockpiles you know just to

922
00:35:02,880 --> 00:35:04,160
provide the goods

923
00:35:04,160 --> 00:35:07,119
uh while waiting for films to to recover

924
00:35:07,119 --> 00:35:08,880
you can think also about contingency

925
00:35:08,880 --> 00:35:09,440
plans

926
00:35:09,440 --> 00:35:11,440
specific agreements between governments

927
00:35:11,440 --> 00:35:13,440
and firms that some film will switch

928
00:35:13,440 --> 00:35:16,480
to the production of essential goods

929
00:35:16,480 --> 00:35:19,520
during a crisis so i think an important

930
00:35:19,520 --> 00:35:21,680
lesson from kovind 19 is that in the

931
00:35:21,680 --> 00:35:23,280
future government should be

932
00:35:23,280 --> 00:35:26,400
better prepared uh and again

933
00:35:26,400 --> 00:35:28,079
really along the lines of what thomas

934
00:35:28,079 --> 00:35:29,839
explained look at different risk

935
00:35:29,839 --> 00:35:32,079
scenarios have some indicators on

936
00:35:32,079 --> 00:35:34,320
bottlenecks vulnerabilities in supply

937
00:35:34,320 --> 00:35:34,800
chains

938
00:35:34,800 --> 00:35:36,640
and this is something the g7 has been

939
00:35:36,640 --> 00:35:38,960
working on with some reports drafted by

940
00:35:38,960 --> 00:35:39,920
oecd

941
00:35:39,920 --> 00:35:42,000
and oecd and other international

942
00:35:42,000 --> 00:35:43,920
organizations together with government

943
00:35:43,920 --> 00:35:45,680
we will certainly continue to draw

944
00:35:45,680 --> 00:35:46,400
lessons

945
00:35:46,400 --> 00:35:49,520
identify best practices uh and see in

946
00:35:49,520 --> 00:35:50,720
particular how

947
00:35:50,720 --> 00:35:53,359
international cooperation can bring this

948
00:35:53,359 --> 00:35:53,920
kind of

949
00:35:53,920 --> 00:35:56,960
robustness in value chains

950
00:35:56,960 --> 00:35:59,119
thank you very much uh sebastian i

951
00:35:59,119 --> 00:36:01,200
actually had a lot more questions for

952
00:36:01,200 --> 00:36:03,119
our speakers but we have less than 10

953
00:36:03,119 --> 00:36:04,320
minutes left

954
00:36:04,320 --> 00:36:07,280
so i'll just do one last question very

955
00:36:07,280 --> 00:36:08,079
quickly uh

956
00:36:08,079 --> 00:36:10,880
one minute uh each of you and my

957
00:36:10,880 --> 00:36:13,599
question is against the backdrop of this

958
00:36:13,599 --> 00:36:17,520
eu debate on strategic autonomy and

959
00:36:17,520 --> 00:36:18,760
perhaps greater

960
00:36:18,760 --> 00:36:22,320
self-sufficiency can this be europe's

961
00:36:22,320 --> 00:36:24,640
opportunity going forward can europe win

962
00:36:24,640 --> 00:36:26,000
from all of this for example

963
00:36:26,000 --> 00:36:27,760
by i don't know reshoring parts of

964
00:36:27,760 --> 00:36:29,760
production home through technological

965
00:36:29,760 --> 00:36:30,640
advances

966
00:36:30,640 --> 00:36:33,839
or something similar maybe uh mikhail

967
00:36:33,839 --> 00:36:35,440
starting uh with you can this be

968
00:36:35,440 --> 00:36:37,040
europe's opportunity

969
00:36:37,040 --> 00:36:39,760
no no sure i i think and i you know

970
00:36:39,760 --> 00:36:43,440
sebastian just alluded to that

971
00:36:44,000 --> 00:36:47,359
i think the argument that says we are

972
00:36:47,359 --> 00:36:49,200
investing in people

973
00:36:49,200 --> 00:36:52,839
we are training specialising vaccines

974
00:36:52,839 --> 00:36:55,839
doctors we are investing

975
00:36:55,839 --> 00:36:59,400
in technologies for ventilators and

976
00:36:59,400 --> 00:37:02,400
pharmaceuticals and in the end we cannot

977
00:37:02,400 --> 00:37:05,200
in times of stress when people are dying

978
00:37:05,200 --> 00:37:07,280
we cannot actually

979
00:37:07,280 --> 00:37:09,839
impose anything on those companies i

980
00:37:09,839 --> 00:37:11,359
think it is a valid argument

981
00:37:11,359 --> 00:37:14,240
and you did see it in eu you saw it with

982
00:37:14,240 --> 00:37:16,160
the largest pharmaceutical companies and

983
00:37:16,160 --> 00:37:18,720
ventilator producers in switzerland

984
00:37:18,720 --> 00:37:22,000
uh during during the the the

985
00:37:22,000 --> 00:37:25,119
pandemic and i think we have to remember

986
00:37:25,119 --> 00:37:27,839
european corporates are the biggest

987
00:37:27,839 --> 00:37:29,200
investors

988
00:37:29,200 --> 00:37:31,359
european companies are the most

989
00:37:31,359 --> 00:37:33,200
international companies of all companies

990
00:37:33,200 --> 00:37:34,400
in the world

991
00:37:34,400 --> 00:37:37,760
um by any standards and and i think in

992
00:37:37,760 --> 00:37:40,480
this regard if there is this

993
00:37:40,480 --> 00:37:43,040
in-depth reflection i think it it does

994
00:37:43,040 --> 00:37:43,920
indeed

995
00:37:43,920 --> 00:37:47,280
uh pose uh

996
00:37:47,280 --> 00:37:50,320
a a a big chance it is it is i think it

997
00:37:50,320 --> 00:37:51,359
is a chance

998
00:37:51,359 --> 00:37:55,680
having having said that um you cannot

999
00:37:55,680 --> 00:37:59,359
solve um problems new problems with old

1000
00:37:59,359 --> 00:38:00,000
methods

1001
00:38:00,000 --> 00:38:02,240
and very much to to the point it was

1002
00:38:02,240 --> 00:38:04,160
made by thomas is

1003
00:38:04,160 --> 00:38:05,920
you know is this lack of institutional

1004
00:38:05,920 --> 00:38:07,599
capacity lack of

1005
00:38:07,599 --> 00:38:09,680
you know an ability to react very

1006
00:38:09,680 --> 00:38:11,920
quickly and in this regard i would very

1007
00:38:11,920 --> 00:38:13,599
much be in favor of a

1008
00:38:13,599 --> 00:38:15,920
of a new recovery plan which is more

1009
00:38:15,920 --> 00:38:18,160
bottom top the top bottom

1010
00:38:18,160 --> 00:38:21,920
because you know you you should not

1011
00:38:21,920 --> 00:38:25,119
you should be really able to to see

1012
00:38:25,119 --> 00:38:27,520
from bottom top what are the real

1013
00:38:27,520 --> 00:38:29,200
problems it seems to me that the new

1014
00:38:29,200 --> 00:38:30,079
policies are

1015
00:38:30,079 --> 00:38:31,920
a little bit much top bottom in this

1016
00:38:31,920 --> 00:38:33,200
regard in terms of

1017
00:38:33,200 --> 00:38:35,280
policy response recovery okay great

1018
00:38:35,280 --> 00:38:36,400
thank you for the beep

1019
00:38:36,400 --> 00:38:39,599
yes uh thank you um very quickly thomas

1020
00:38:39,599 --> 00:38:41,280
one minute and then gordon and then we

1021
00:38:41,280 --> 00:38:44,160
move to the q a

1022
00:38:45,680 --> 00:38:48,720
for me it's uh uh quite clear uh what

1023
00:38:48,720 --> 00:38:51,520
uh the next generation eu can and should

1024
00:38:51,520 --> 00:38:52,240
do

1025
00:38:52,240 --> 00:38:55,359
uh is uh to uh have

1026
00:38:55,359 --> 00:38:57,760
significant institutional reforms and

1027
00:38:57,760 --> 00:38:58,720
not just be

1028
00:38:58,720 --> 00:39:01,200
something where you invest and that is

1029
00:39:01,200 --> 00:39:02,560
how we will become

1030
00:39:02,560 --> 00:39:06,079
more resilient and each and every uh

1031
00:39:06,079 --> 00:39:08,000
government will have to do that by

1032
00:39:08,000 --> 00:39:10,560
itself but i see very few governments

1033
00:39:10,560 --> 00:39:13,839
uh where politics is willing to let go

1034
00:39:13,839 --> 00:39:15,440
of the principle

1035
00:39:15,440 --> 00:39:18,000
of independent professional and high

1036
00:39:18,000 --> 00:39:18,720
quality

1037
00:39:18,720 --> 00:39:21,760
administrations thank you

1038
00:39:21,760 --> 00:39:24,160
gordon

1039
00:39:25,040 --> 00:39:27,839
i think the eu could be coming out well

1040
00:39:27,839 --> 00:39:30,240
but there will be a k-shaped recovery

1041
00:39:30,240 --> 00:39:32,720
not just among industries and and

1042
00:39:32,720 --> 00:39:34,800
companies but among nations and regions

1043
00:39:34,800 --> 00:39:36,480
around the world and whether europe will

1044
00:39:36,480 --> 00:39:37,680
be on the downward

1045
00:39:37,680 --> 00:39:40,320
part of decay or the upward part of the

1046
00:39:40,320 --> 00:39:43,119
cave will depend on whether we can

1047
00:39:43,119 --> 00:39:45,760
forget about our previous policy of

1048
00:39:45,760 --> 00:39:47,599
strategic naivety

1049
00:39:47,599 --> 00:39:49,359
and replace it with enlightened

1050
00:39:49,359 --> 00:39:52,240
self-interest and realize that

1051
00:39:52,240 --> 00:39:54,160
we have to be a bit more carnivore and

1052
00:39:54,160 --> 00:39:56,480
less herbivore in a world where every

1053
00:39:56,480 --> 00:39:58,720
every other major region and trading

1054
00:39:58,720 --> 00:39:59,839
partner or

1055
00:39:59,839 --> 00:40:01,599
economic or political partner is

1056
00:40:01,599 --> 00:40:02,960
behaving much more

1057
00:40:02,960 --> 00:40:07,119
assertively so that means

1058
00:40:07,200 --> 00:40:10,319
we need to create europe as a europe's

1059
00:40:10,319 --> 00:40:11,359
biggest offer

1060
00:40:11,359 --> 00:40:13,599
in in this competition globally is its

1061
00:40:13,599 --> 00:40:17,359
market is its 450 60 million people

1062
00:40:17,359 --> 00:40:20,800
very high value market we have to be

1063
00:40:20,800 --> 00:40:22,960
more selective of how we offer this to

1064
00:40:22,960 --> 00:40:24,480
others but we should

1065
00:40:24,480 --> 00:40:26,480
push for cooperation because that's our

1066
00:40:26,480 --> 00:40:28,000
self-interest

1067
00:40:28,000 --> 00:40:30,960
but we also have to market is not enough

1068
00:40:30,960 --> 00:40:32,400
strength in this global

1069
00:40:32,400 --> 00:40:34,800
political competition we need to bring

1070
00:40:34,800 --> 00:40:36,319
up our foreign policy

1071
00:40:36,319 --> 00:40:38,480
and the two-states foreign policy has to

1072
00:40:38,480 --> 00:40:41,119
get tools by a defense policy

1073
00:40:41,119 --> 00:40:43,440
and uh we also need to change the whole

1074
00:40:43,440 --> 00:40:45,680
fiscal setup of the eu we need much more

1075
00:40:45,680 --> 00:40:46,480
fiscal

1076
00:40:46,480 --> 00:40:48,720
uh coordination at the european level

1077
00:40:48,720 --> 00:40:49,920
and we have to able to

1078
00:40:49,920 --> 00:40:53,119
protect our industries ultimately for us

1079
00:40:53,119 --> 00:40:55,119
europeans to keep our european

1080
00:40:55,119 --> 00:40:58,000
way of living in the next century europe

1081
00:40:58,000 --> 00:40:58,319
is

1082
00:40:58,319 --> 00:41:01,040
noah's ark which can help us to survive

1083
00:41:01,040 --> 00:41:01,920
the flood of

1084
00:41:01,920 --> 00:41:05,040
global rebalancing but whether this ark

1085
00:41:05,040 --> 00:41:07,040
floats or sinks depends pretty much on

1086
00:41:07,040 --> 00:41:09,599
the next 10 years actions

1087
00:41:09,599 --> 00:41:12,000
thank you very much uh to all of our

1088
00:41:12,000 --> 00:41:13,599
excellent panelists

1089
00:41:13,599 --> 00:41:16,640
um i don't see any questions uh

1090
00:41:16,640 --> 00:41:19,680
submitted via slido so i would maybe ask

1091
00:41:19,680 --> 00:41:20,160
our

1092
00:41:20,160 --> 00:41:22,880
live our physical audiences and maybe we

1093
00:41:22,880 --> 00:41:24,640
can do it old school if you can

1094
00:41:24,640 --> 00:41:26,000
raise your hand if you have any

1095
00:41:26,000 --> 00:41:28,880
questions anyone in the room

1096
00:41:28,880 --> 00:41:34,319
there's a standing mic don't be shy

1097
00:41:34,319 --> 00:41:36,400
i i think we covered all the topics we

1098
00:41:36,400 --> 00:41:38,560
covered all the grounds right didn't we

1099
00:41:38,560 --> 00:41:40,240
oh maybe we were not controversial

1100
00:41:40,240 --> 00:41:41,680
enough i don't know

1101
00:41:41,680 --> 00:41:45,040
or maybe that uh still no questions via

1102
00:41:45,040 --> 00:41:47,680
slido

1103
00:41:47,839 --> 00:41:50,960
okay let's do something else uh i will

1104
00:41:50,960 --> 00:41:51,359
ask

1105
00:41:51,359 --> 00:41:53,920
my producer to pull up the second poll

1106
00:41:53,920 --> 00:41:55,680
and maybe people can weigh in there

1107
00:41:55,680 --> 00:41:59,680
this is a word cloud poll and

1108
00:41:59,680 --> 00:42:02,480
it says please describe in one word the

1109
00:42:02,480 --> 00:42:04,160
first thing that comes to mind and also

1110
00:42:04,160 --> 00:42:04,960
that is

1111
00:42:04,960 --> 00:42:07,440
most all-encompassing what recent

1112
00:42:07,440 --> 00:42:09,680
turbulence in cross-border production

1113
00:42:09,680 --> 00:42:11,599
means for the future of the european

1114
00:42:11,599 --> 00:42:13,040
economy so we would have

1115
00:42:13,040 --> 00:42:15,359
our audiences to weigh in on the same

1116
00:42:15,359 --> 00:42:16,640
questions that we have posed to our

1117
00:42:16,640 --> 00:42:17,680
speakers

1118
00:42:17,680 --> 00:42:19,760
so it can be anything resilience

1119
00:42:19,760 --> 00:42:21,599
autonomy dependence winner loser

1120
00:42:21,599 --> 00:42:22,560
stronger weaker

1121
00:42:22,560 --> 00:42:24,480
whatever comes to mind it would be great

1122
00:42:24,480 --> 00:42:26,400
if if you could engage and we

1123
00:42:26,400 --> 00:42:30,240
we should see some um

1124
00:42:30,240 --> 00:42:33,280
results on the screen what our audiences

1125
00:42:33,280 --> 00:42:36,160
think uh these developments mean for the

1126
00:42:36,160 --> 00:42:45,839
future of the european economy

1127
00:42:50,800 --> 00:42:53,920
all right we see flexibility

1128
00:42:53,920 --> 00:42:57,119
progress opportunity decreased

1129
00:42:57,119 --> 00:42:59,839
influence

1130
00:43:00,319 --> 00:43:04,720
all right progress is the most uh

1131
00:43:04,720 --> 00:43:07,440
typed in term to describe what it means

1132
00:43:07,440 --> 00:43:09,520
for the future of the european economy

1133
00:43:09,520 --> 00:43:11,839
okay well that's not bad at all if it's

1134
00:43:11,839 --> 00:43:14,480
opportunity

1135
00:43:14,480 --> 00:43:18,240
all right uh great i would hereby

1136
00:43:18,240 --> 00:43:21,599
um conclude today's session uh

1137
00:43:21,599 --> 00:43:24,960
we have looked at several layers of

1138
00:43:24,960 --> 00:43:28,000
how to secure value chains we took stock

1139
00:43:28,000 --> 00:43:28,640
of the d

1140
00:43:28,640 --> 00:43:31,040
globalization drivers the macroeconomic

1141
00:43:31,040 --> 00:43:32,000
picture

1142
00:43:32,000 --> 00:43:33,680
discuss whether building durable

1143
00:43:33,680 --> 00:43:35,680
companies requires a major

1144
00:43:35,680 --> 00:43:39,200
global value chains overhaul and also

1145
00:43:39,200 --> 00:43:40,560
how can policy help

1146
00:43:40,560 --> 00:43:42,720
underpinning uh resilience of global

1147
00:43:42,720 --> 00:43:45,440
value chains we also discussed some

1148
00:43:45,440 --> 00:43:48,400
coping strategies um and pondered

1149
00:43:48,400 --> 00:43:50,880
whether recent developments are indeed

1150
00:43:50,880 --> 00:43:53,599
europe's opportunity going forward thank

1151
00:43:53,599 --> 00:43:54,000
you very

1152
00:43:54,000 --> 00:43:56,000
much uh for the great panel for their

1153
00:43:56,000 --> 00:43:57,680
insights and also

1154
00:43:57,680 --> 00:44:01,119
uh to our audiences for not so lively

1155
00:44:01,119 --> 00:44:02,560
discussion i might say

1156
00:44:02,560 --> 00:44:04,800
i might say but uh for the nice

1157
00:44:04,800 --> 00:44:06,720
engagement in the

1158
00:44:06,720 --> 00:44:10,079
live polls and stay tuned for the theme

1159
00:44:10,079 --> 00:44:12,240
surrounding economic uh recovery on the

1160
00:44:12,240 --> 00:44:14,880
globstech website and social media

1161
00:44:14,880 --> 00:44:18,240
next up we have in habsburg at 12 15

1162
00:44:18,240 --> 00:44:20,319
a session called big tech and european

1163
00:44:20,319 --> 00:44:22,720
regulations and right now

1164
00:44:22,720 --> 00:44:25,680
in this room we will be live streaming

1165
00:44:25,680 --> 00:44:28,400
maria theresa stage with a session

1166
00:44:28,400 --> 00:44:30,720
geopolitical europe at crossroads

1167
00:44:30,720 --> 00:44:33,119
western balkans in the post covet 19

1168
00:44:33,119 --> 00:44:35,599
era with ministers of foreign affairs

1169
00:44:35,599 --> 00:44:38,000
from croatia macedonia and slovenia

1170
00:44:38,000 --> 00:44:41,040
so thank you very much thank you thank

1171
00:44:41,040 --> 00:44:51,839
you very much

1172
00:44:54,720 --> 00:44:56,799
you