“We are not going to lead our society to a low-carbon economy by continuing to finance the status quo. “ Central bankers now seem keen to take on responsibility for policy objectives they have previously shied away from – in particular, tackling climate change. European Central Bank President Christine Lagarde acknowledged in January that central bankers will have to look beyond their traditional duties to address the challenge. ECB Executive Board Member Isabel Schnabel said in September 2020 that central banks should be an active part of the collective effort to reduce carbon emissions. Executive Board Member Fabio Panetta said ECB analysis can help make climate-risk valuations more accurate. Should central banks continue accommodating corporate bonds and bank loans of high carbon companies as collateral, or should they reduce them? Giuseppe Porcaro, is joined by Rebecca Christie, Jean Pisani-Ferry and Dirk Schoenmaker to discuss the hot topic of the role of central banks in greening finance and possibly contribute to decarbonisation. The three guests of this episode recently published a series of blog posts which tackle the issue from complementary perspective: Christie, R. (2021) ‘US separates climate concerns from financial oversight in contrast to EU activism’, Bruegel Blog, 18 February Pisani-Ferry, J. (2021) ‘Central banking’s brave new world’, 24 February Schoenmaker, D. (2021) ‘A brown or a green European Central Bank?’ Bruegel Blog, 24 February

How effective have COVID-19 credit support programmes been? COVID-19 has caused unprecedented disruption to business. Since the first lockdowns, governments have used credit support programmes as the main instrument to mitigate the liquidity shock businesses have been facing. Have the programmes worked? Bruegel Director Guntram Wolff is joined by Bruegel's very own Julia Anderson, Francesco Papadia and Nicolas Véron to talk about their research into credit support programmes in Europe’s five largest economies. They share their findings with us as well as possible policy implications.

Across the Atlantic, EU member states have been discussing a recovery plan since last spring, striking an agreement over the summer to create a €750 billion pandemic recovery fund. Hard-pressed EU capitals must now submit detailed plans to Brussels to unlock their share of the cash and begin rebooting their economies. One such country is Italy, where an ambitious once in a generation plan is being drawn up to spend €200 billion to relaunch an anaemic economy. The hope is that by pushing through unpalatable reforms together with funds underwritten by 27 member states, that an economy that has not grown in real terms for over two decades can be jump-started. Bruegel has been tracking the national recovery plans that states have been submitting to Brussels to unlock funds and plans to release an overview soon. Giuseppe Porcaro is joined by Bruegel scholars Carlo Altomonte, Maria Demertzis and Zsolt Darvas to discuss economic stimulus and its implications. For more details, please check our dataset on national fiscal response to the economic fallout from the coronavirus.

The European Green Deal is a plan to decarbonise the EU economy by 2050, revolutionise the EU’s energy system, profoundly transform the economy and inspire efforts to combat climate change. But the plan will also have profound geopolitical repercussions and is likely to impact partner countries adversely. In the latest paper co-written by Bruegel and the European Council on Foreign Relations, the authors map out the geopolitical implications and lay out a foreign policy agenda to manage the geopolitical aspects of the European Green Deal and lead climate change efforts globally. In this episode of The Sound of Economics, co-authors Jeremy Shapiro of the European Council on Foreign Relations, as well as Jean Pisani Ferry, Simone Tagliapietra and Guntram Wolff of Bruegel introduce their paper and give their insight on this issue. Related content: Leonard, M., J.Pisani-Ferry, J. Shapiro, S. Tagliapietra and G. Wolff (2021) ‘The geopolitics of the European Green Deal’, Policy Contribution 04/2021, Bruegel Event, The geopolitics of the Green Deal

On 30 November 2020 after over 7 years of talks, the European Union and China concluded negotiations for a Comprehensive Agreement on Investment (CAI for short). The agreement is intended to increase investment between the EU and China by establishing a legal framework and common rules on issues ranging from state-owned enterprises to subsidy transparency and rules against the forced transfer of technologies. The deal replaces more than two dozen bilateral investment treaties between the EU’s 27 member states and China, improving market access for European companies operating — or intending to operate — in China and ensuring a level playing field and reciprocity when they do. Does the agreement actually live up to the above claims and seven years of expectation? To help us find out, in this episode of the Sound of Economics Giuseppe Porcaro is joined by Bert Hofman, the director of the East Asian Institute at National University of Singapore and Bruegel’s China expert Alicia García-Herrero, for a in depth commentary and glance at what the detail of the deal means for Europe.

“We have to open our mind, we have to look internationally. Because if we don’t, COVID-19 is going to stay with us.” One year since the pandemic began, widespread vaccination has finally started. It would be a mistake however to say the end is in sight. Senior fellows Uri Dadush and J. Scott Marcus join Bruegel director Guntram Wolff to talk COVID-19 vaccine strategy, from testing and production to procurement and inoculation.

A conversation on green recovery with the Polish Minister of Climate and Environment, Michał Kurtyka Poland is sometimes characterised as the black sheep of EU climate policy: in 2019, more than 70 percent of the country’s electricity was generated by coal. In the meantime, it is closing down coal mines and discussing building a nuclear power plant in order to diversify its energy supplies. What is Poland’s climate policy and how is it evolving? Is the idea of Poland’s characterisation as a scapegoat of the failure of international climate ambitions misleading? In this episode of the Sound of Economics, Bruegel's Guntram Wolff and Georg Zachmann are joined by Michał Kurtyka, the Minister of Climate and Environment of Poland and former President of the COP24 in Katowice, considered by many as a climate champion in the country. They discuss current climate policy in Poland, the social impact of decarbonisation, how the EU’s recovery package can help smooth the climate transition, and the future of international climate diplomacy. Research mentioned: Bergamini, E. and G. Zachmann (2020) ‘Understanding the European Union’s regional potential in low-carbon technologies’, Working Paper 07/2020, Bruegel Wolff, G. (2020) ‘Europe should promote a Climate Club after the US elections’

As the year draws to a close, Giuseppe Porcaro invites Maria Demertzis, André Sapir and Guntram Wolff to review this eventful year in economic policy and beyond. The guests also talk about a book that has marked them this year and finally, their hopes and wishes for the decade ahead. Events mentioned: Monetary policy after the pandemic, with Janet Yellen Together for Europe’s recovery and for a better, more sovereign Europe, with Olaf Scholz The green deal: Europe’s growth strategy, with Frans Timmermans Books mentioned: Zuboff, Shoshana. The Age of Surveillance Capitalism: The Fight for a Human Future at the New Frontier of Power. New York: PublicAffairs, 2019. Carreyrou, John. Bad blood: Secrets andLiies in a Silicon Valley Startup. New York: Knopf, 2018. Aral, Sinan. The Hype Machine: How Social Media Disrupts Our Elections, Our economy, And Our Health–And How We Must Adapt. New York: New York Currency, 2020. Bratton, Benjamin H. The Stack: On Software and Sovereignty. Massachusetts: MIT Press, 2016.

In this episode of the Sound of Economics, Giuseppe Porcaro is joined by Maria Demertzis, J. Scott Marcus, Georgios Petroupolos, and Mario Mariniello, Bruegel experts on digital policy to delve into the latest EU digital regulations: the Digital Services Act and the Digital Markets Act. What is the Commission proposing? What connections do these two bills have, and what policy and market implication do they have?

In this episode of the Sound of Economics, Paola Subacchi, Professor of international economics and chair of the advisory board of the Global Policy Institute at Queen Mary University of London, and Bruegel senior scholars Alicia García-Herrero and Michael Leigh join Giuseppe Porcaro for an age-old discussion but with a twist. They try to understand the geopolitical role of money, in other words, currencies and capital flows. While unconstrained capital flows cause afflictions of the global economy, the current debate on currencies is in fact driven by politics rather than economics, as Alicia argued in an opinion piece recently: Politics, not economics, demands a strengthened international role for the euro. What would the next US Treasury Secretary, Janet Yellen do on the dollar?