The President of the AEB, José María Roldán, considers that the Single Market is Europe’s crown jewel, which under no circumstances can become the unexpected victim of this crisis. He stated this during his speech at a webinar organized by the Club of Spanish Exporters and Investors on “Post-COVID-19 Financial Globalization.”
In his opinion, “Europe is many things: democratic and tolerant societies, human rights, the welfare state, universal healthcare, but it is also the single market, a great achievement that has increased the prosperity of European citizens and that cannot disappear as a consequence of COVID-19.”
He warns about this risk because he is concerned about the very pronounced differences in public aid granted by several European countries, which may introduce distortions in competition between countries and companies. “We are seeing partial nationalizations of large companies. A return to ‘national champions’ and probably the relocation of companies.”
It seems—he added—as if the rules on State aid had been suspended—had taken a vacation—and he wondered how all this will affect the functioning of the Single Market, to conclude: “we must provide a joint European response if we want to strengthen the European Union at a time when the world is fragmenting into blocs.”
At this digital meeting with members of the Club of Spanish Exporters and Investors, the President of the AEB addressed various aspects of the financial globalization process, about which, among other things, he said it had allowed Spain to finance very high external debt without problems, even in moments as complex as the current one.
He recalled in this regard that the 2008 crisis, which saw a major setback in European integration, highlighted the fragility that external debt represents for the Spanish economy. “We saw then that the problem was not financing at higher cost but simply finding that no one would finance you.”
In his view, that lesson is especially timely at this moment when the deficit and public sector debt will increase as a consequence of the COVID-19 crisis, making it vitally important to maintain a reasonable long-term reduction path for both parameters, as well as economic policies that are credible in international markets. “To the extent that we do so, we will not have financing problems as we have not had them in the past.”
He also referred to the Spanish model of banking internationalization, especially valuable in countries with high external debt, a model that provided the Spanish economy with stability in the past crisis and will do so in this one. “It is a pity that financial regulation does not recognize the only diversification that worked during the great recession, but we are still in time to correct this.”
José María Roldán, Chairman of the Spanish Banking Association
