The word ‘reconstruction’ refers to the repair or new construction of something destroyed, damaged, or deteriorated. ‘Reconversion’, for its part, focuses on modernization or transformation in order to improve and adapt something. Both terms perfectly reflect the economic challenge posed by the health crisis. A challenge that must also be seen as an opportunity to create a more inclusive, digital, and sustainable post-pandemic economy, and an endeavor to which we must all contribute—authorities, companies, and citizens alike. International coordination through European funds provides part of the capital and financing necessary for the strategy to work, along with a clear approach to priorities and the implementation of measures.
The first stone of this new building is to maintain official support for companies and families in the current uncertain and painful scenario. Excited by the news about vaccines, we imagine a future free of Covid when, unfortunately, we are still suffering its consequences. The second wave of the disease led the IMF to lower its growth forecasts last month to a historic drop in global output of 4.4% this year and a partial and uneven recovery of 5.2% in 2021. The consensus on health aid to less developed countries during the G20 held last weekend is undoubtedly encouraging, because faced with a global problem like the one we are experiencing, it is fundamental that the response be coordinated on an international scale and forceful, so that it truly succeeds in combating the uncertainty that depresses business and halts investment.
Economic priorities are now focused on preserving the productive fabric while we overcome the disease and laying the foundations for a more sustainable and inclusive future economy. The effort must be collective as well as individual for each party. We have too much at stake not to do so. The banking sector is very clear on this, hence its constant efforts to improve efficiency, strength, and profitability to cement this economic future that we all desire. However, it is important that national and European authorities fulfill their mission to complete a banking union that allows for a European banking sector with less excess capacity, one that is more sustainable, stable, and effective, and that competes on equal terms with other international banks. Authorities must also adapt to the digital financial transformation, as the sector itself is doing, to protect consumers and ensure financial stability in the face of the entry of large technology companies subject to laxer regulation and supervision than banks.
European funds, if well-targeted and managed, will allow the European economy to regain the ground lost in digital transformation over the last decade. On one hand, the funds can boost innovative and sustainable projects, and on the other, help modernize traditional labor-intensive sectors. In the short term, it is essential to recover the employment lost in the crisis and make it compatible with reforms that lead to an increase in potential growth. Banks start with an advantage regarding the need to gain efficiency and effectiveness, as they are accustomed to adapting to complex and competitive scenarios where the customer must be the primary beneficiary. They have innovation and the capacity for adaptation printed in their DNA, something that is now clearly necessary for the entire business fabric given the magnitude of the challenge posed by reconstruction and economic recovery. Banks can also help with their experience and knowledge in this transformation process.
José Luis Martínez Campuzano, spokesperson for the Spanish Banking Association
