[런던=뉴스핌] Correspondent Jang Il-hyeon = European Central Bank (ECB) President Christine Lagarde said on the 28th (local time) that rather than responding directly to the tariff and trade war led by U.S. President-elect Donald Trump, we should use a negotiation strategy to purchase more American products. said.
In his first interview with the British daily Financial Times (FT) after Trump won the US presidential election, he said, “A harsh trade war will not help anyone and risks collapsing the global economy,” and added, “Negotiation, not retaliation, is necessary.” “It is necessary,” he said.
Regarding Trump’s pledge to ‘make America great again,’ Governor Lagarde expressed a critical view, saying, “How can we make America great again when global demand is decreasing?”
Examples of American products that Europe should pay attention to include liquefied natural gas (LNG) and weapons. “We need to respond to a second Trump term with a check-book strategy of purchasing specific items in the United States,” he said. “This provides a better scenario than a simple retaliatory strategy that leads to a response where no one wins.” He said.
The checkbook strategy refers to a policy approach in which governments or international organizations mobilize enormous funds to respond to immediate crises and issues such as energy shortages, inflation, and military threats.
President Lagarde also said, “In the end, it is up to us Europeans to transform such threatening attitudes into our own challenges.”
Meanwhile, the Financial Times reported that the European Commission, the executive branch of the European Union (EU), is considering increasing purchases of US exports, including agricultural products, LNG, and weapons in preparation for the Trump era.
The European Commission is also known to be pursuing a plan to allow American companies to participate in EU-funded arms production and purchase projects and to pursue trade and geopolitical policies related to China more closely with the United States.
President Lagarde said she agreed with former ECB President Mario Draghi’s diagnosis that “Europe is facing an existential challenge,” and added, “Europe is clearly falling behind (the United States, etc.),” adding, “But I will not say that Europe cannot catch up. “He said.
In response to the point that the European economy is so outdated and disorganized that the continent is turning into a museum, he said, “If you ask me, I will answer that it is a pretty attractive museum.”
He went on to say, “The EU needs to move quickly,” on the idea of a “capital markets union,” which calls for Europe to create a single market for capital in Europe.
The Capital Markets Union was proposed by European Commission President Jean-Claude Juncker in 2014, but progress has been slow due to domestic opposition from EU member states.
President Lagarde said, “I have never seen this level of understanding and excitement about the Capital Markets Union in each EU country,” adding, “Supervision of the European capital markets should be transferred from the authorities of the 27 EU member states to the European Securities Market Supervisory Authority.” He said.
ihjang67@newspim.com
How does Lagarde’s emphasis on negotiation and economic engagement as opposed to retaliation reflect a broader shift in European approaches to international relations and diplomacy?
## European Central Bank Chief Advocates “Checkbook Strategy” to Counter US Trade Policies
**London, June 7th** – In the wake of Donald Trump’s re-election, European Central Bank (ECB) President Christine Lagarde has called for a strategic “checkbook diplomacy” approach to navigate potential trade tensions, urging Europe to purchase more American goods as a means of mitigating conflict.
In a candid interview with the Financial Times, Lagarde cautioned against retaliatory measures, emphasizing that a “harsh trade war will not help anyone and risks collapsing the global economy.” Rather, she stressed the need for “negotiation, not retaliation,” advocating for a more nuanced approach.
Lagarde expressed reservations about Trump’s ”Make America Great Again” campaign pledge, questioning its viability in a world where global demand is shrinking.
“How can we make America great again when global demand is decreasing?” she posed, highlighting the interconnected nature of the global economy.
Specifically, Lagarde urged Europe to invest in American products such as liquefied natural gas (LNG) and weapons.
“We need to respond to a second Trump term with a check-book strategy of purchasing specific items in the United States,” she stated. This, she argued, would yield a “better scenario than a simple retaliatory strategy that leads to a response where no one wins.”
The “checkbook strategy” entails utilizing significant financial resources to address pressing concerns like energy shortages, inflation, and security threats. Lagarde believes this proactive approach can help defuse trade tensions while simultaneously facilitating economic cooperation.
Lagarde concluded by emphasizing European agency in shaping the global landscape: “it is up to us Europeans to transform such threatening attitudes into our own challenges.”
Her statement reflects a determination to forge a path forward amidst uncertainty, prioritizing diplomacy and economic engagement as key tools for navigating the complex geopolitical environment.
**Further analysis:**
* This article highlights the delicate balance European leaders face in navigating trade relations with a potentially protectionist United States.
* Lagarde’s call for a “checkbook strategy” is a pragmatic approach, recognizing the potential economic damage of a full-blown trade war.
* However, it remains to be seen whether this approach will be effective in changing Trump’s stance on trade.
* The article also raises broader questions about the future of globalization and the role of international institutions in managing global economic challenges.
