At the Brussels Economic Forum (BEF), the head of the International Monetary Fund (IMF) and former European Commissioner Kristalina Georgieva warned against fragmentation of world trade.
She mentioned the EU’s ‘Green Deal Industrial Plan’ and its financial support: “In order to play their intended role and accelerate the green transition, they must be well designed and carefully implemented. If subsidies are too generous, they can have significant fiscal costs, disrupt trade and investment decisions and make the green transition more costly for all”, she said in her introductory speech.
The different responses to the Covid-19 crisis and the war in Ukraine are creating a more fragmented world for trade and investment, according to the IMF Director, who did not mention the US Inflation Reduction Act (IRA).
According to Georgieva, the climate transition and emerging economies will be the first to suffer from protectionist behaviour: “If these countries lack the investment to facilitate the development of these technologies, their carbon emissions will continue to rise”. (Original version in French by Léa Marchal)