 What kind of world do I want to live in? I think about this question a lot For our generation and for specifically my group of people, which is refugees The circumstances might dismantle any vision of the future that we have You're trying to rebuild, you're trying to make a future for yourself and then the climate-related disaster come and you start again It's not about how it's affecting you now. It's about how it's affecting you your entire life The first step to understand is that we're all a part of it. None of us are going to be left out by the crisis We're at a stage where if we don't act now, we there won't be very much left There are generations that will never see certain things that we grew up seeing in real life We have to start treating this like the emergency it is To achieve the 17 sustainable development goals, we have to go from an intention to a serious commitment Business leaders really need to rethink how they conduct their business and invest in creating systems that are climate friendly The action I would like to see is accountability Structures being put in place where countries aren't just asked to do something but they're kept accountable to the decisions that they make There has to be that strong collaboration between government, between corporations, between youth activists to drive change forward The world I would want to live in is a world where imagining the future is not a privilege I want to live in a world where people do not give up on hope, hope that a positive change is possible The fact that you're listening today means that you are willing to make a change Welcome to this excellent panel we've got for the next 45 minutes entitled Global Economic Outlook And I'm sure as you're all very very aware any panel with that title can go in multiple directions We're not going to have enough time in 45 minutes to go through every piece of my new shine the global economy But I can tell you we have got an absolutely excellent panel of economists who are going to just talk through some of the biggest issues as they see it as well We're going to talk for about 25 minutes with those economists and then you the audience will have ample opportunities should you so wish to get involved in what will be an interactive discussion as well Now you can put your questions in through the usual channels like Slido or questions are on the screen as you can see them I think you can put them in via the chat or what have you got I will get those questions and I will get those questions to the economists if you should so ask questions Now the panel I will tell you in no particular order is a fantastic one We have Dirk Jan Onzik who is the Chief Economist at the United Nations Office for the Coordination of Humanitarian Affairs He's joining us from New York. Very good to see you this afternoon Dirk Jan Razia Khan is the Head of Research Chief Economist African Middle East at Standard Charter Bank Joining us from the exotic location of West London and even more exotic location of Wilshire I think he's pretty much there that is Paul Donovan an old friend of mine global Chief Economist at UBS World Management This will be a good conversation I can tell you because one of the aforementioned economists has said to me on many occasions who started a conversation on many occasions if only economists ran the world and then you the audience can fill in the gap but if only economists I won't tell you who said that all I can say is he works for a Swiss bank right okay so let's just get through some of the details as well the world economic recovery is taking hold at the moment I've got the IMF latest publication on my screen it says 6% growth in 2021 4.9% growth in 2022 but this is the key message vaccine access has emerged as the principal thought line along which the global recovery splits into two blocks those that can look forward to further normalization of activity later this year almost all of the advanced economies and those that will face resurgent infections and rising Covid death tolls there are many many questions we have in this panel but one I think is to find out where we are now and what are the opportunities going forward what are the risks going forward and how a collective recovery is this as well so with that in mind I'm going to go in no particular order to our panel now and for an opening round of questions and I will go to Paul Donovan first if I may he's the global chief economist as I mentioned at UBS wealth management Paul can you give us a broad brush of where you see we're at now compared to perhaps where we were a year ago and where you think we are going on this global economic recovery good morning to you my panel good afternoon I should say afternoon well I'm very much of the view that we didn't have in any conventional sense of recession in 2020 and we're not having in any conventional sense a recovery right now what we had actually I think that the closest parallel is France's grand vacance where obviously in August traditionally you see a big drop in economic activity as everybody takes holiday and then you get this sudden resurgence of activity a very abrupt move back to activity as people return in September and I think that that sort of binary process rather than the more classic gradual descent and recovery cycle is what we're experiencing and so as soon as we've seen restrictions be eased we have seen consumption take place and that consumption in developed markets though not so much in emerging markets has been fueled by the accumulated savings that were forced on people in 2020 and so it's given us a very strong very consumer focused period of economic bounce back which has been very abrupt and has led to some extraordinary demand levels so in the States for example non-auto durable goods demand is about 25% above trend I mean it's astonishingly strong and that of course is coming from two factors firstly this accumulated part of savings and secondly the fact that people have tended to spend on goods rather than on services at least in the first waves of coming back overall then that's given us a strong global bounce back this year I think that some of the momentum of that will carry into next year particularly as not all economies as you were saying are coming back at the same time so we've seen broadly the Anglo-Saxon economies leading Europe is about six months behind emerging markets have tended to be selling into that consumer strength so trade has recovered very very quickly and it's selling into the consumption demand of Western Europe and the United States I think therefore that we continue to see strong growth but we have to accept that the really exceptional growth levels that we had earlier this year are not going to continue Paul I'm going to get this question to you straight away it's something that you and I have debated a lot over the last year as well are we seeing real inflation coming through I know what you think but why don't you share it with our audience so we're not so inflation is a general rise in prices lots of prices rising in the economy because that tells you that there is an imbalance in the economy which needs to be resolved and we are simply not seeing that at the moment what we have or what we have had is very narrow inflation so one or two goods prices rising one or two services rising and it's not the job of central bankers to intervene in a specific product market in Fed chair Powell is not a used car salesperson Fed chair Powell cannot influence the price of used cars in the United States and there's no way he should put the economy into an economic downturn just because the price of a Honda Civic from 2001 is rising at 45% a year so we have here this very specific nature and what I think is very significant is that we're starting to see that reverse the moment demand starts to fade price competition is really reexerting itself so again in the States airfares have been a big part of the inflation spike on the headline CPI as we have seen demand for air travel start to fade back a bit we've immediately gone into price competition and we're rapidly moving into a disinflation phase which I think actually will come deflation as far as airfares are concerned so I don't think we've got a general inflation problem I think we've got some specific imbalances in certain product markets in some cases that's being met with just simply delays in delivery you just got to wait for it in other cases there is an attempt to ration demand using the price mechanism which temporarily pushes up prices but I think the evidence is now pretty overwhelming this is a temporary spike in terms of headline CPI I will ask you later on whether you managed to sell that 2001 Honda Civic because I know you've been trying to fog it for a very long time Paul let's get to Razia Khan, Razia I'm lovely to see all your notes beforehand and what I thought was very interesting from Paul and this is no criticism I wonder if he was talking very much about the developed world and so let me ask you is the emerging market recovering at the same pace are we seeing the vaccination progress that we need to see so that the rest of the world could be reassured that the emerging market crisis is not going to create a global crisis going forward and just with a reference point I was staggered to see just one of the latest pieces of data now Razia is that only 32% of the population globally have been vaccinated and you compare that to some of the numbers for instance in the United Kingdom 67% of the population Japan 53% United States 55% so clearly a lot of emerging markets and economies are lagging behind what about that compared to the kind of growth that Paul was talking about this is probably the most significant threat to global growth to the global growth outlook that we see on the horizon and for the very key fact that we have seen a great divergence in terms of the amounts of vaccines administered the percentage of populations in different regions have been able to access those vaccines you gave those very stark numbers about emerging markets I wonder how many would realize that if we were to look at specific markets Sub-Saharan Africa for example the numbers are far far lower than that not so long ago we were talking about around 3% of the adult population having been fully vaccinated that's a stark difference from the record that we see elsewhere so the big question is this we heard very compellingly the story from Paul around the developed markets recovery that nice analogy that it seemed a little bit like in August in France when consumption was temporarily lower households were able to save a lot when developed markets and we are really talking about developed markets reopened we saw a lot of the spending of that accumulated unintended savings we saw stronger recoveries as part of that emergence from the COVID lockdowns and of course while there's no expectation that that kind of growth rate is sustained it wasn't a bad starting point for many emerging markets the Sub-Saharan African countries in particular the outlook is very different the reality is we are nowhere near making fast enough progress on the pace of vaccine administration that we need to do the big concern of course is what does this ultimately mean for the global economy what we've seen from financial markets to date is that any time there have been fears around new variants the Delta variant most recently it's knocked back a great deal of that optimism and the fact remains that for as long as a large proportion of the global population remains unvaccinated we don't really have those safeguards in place against new variants emerging against some of that optimism that has been carefully cultivated policy no doubt has helped some of that being lost entirely and this is the point about the very divergent path of the global economy we can't take for granted at all that one part of the global economy recovers one part of the global economy has access to vaccines the other does not the recovery lags well behind but there are risks to everyone if we don't get this right expand upon that I think a lot of people in the markets today that are selling off and I speak with the Nasdaq down 2%, the S&P 500 down 1.6% they're worried about the United States they're worried about the inflationary issues that Paul was talking about China growth today and Evergrande will come on today importantly with you and Diana especially a little bit later on but what is the threat we are talking about from emerging market low vaccination rates to the developed world well a great deal of the optimism that we saw reflected in financial markets was based in the belief that with the vaccine administration success and developed markets at least a certain core part of the global economy and the same can now be said of China as well has been able to put the COVID crisis behind it the reopening can happen relatively safely we know that if 70% of the adult population is vaccinated as we're now seeing in China even if there are new COVID cases even if there are new contained measures that are being implemented in certain parts of China it's not going to derail economic growth that's parked the Evergrande dishes for now because that's an entirely different set of concerns but the question is how safe can we be in that belief that we have put the COVID crisis properly behind us if we still have the risk that large proportions of the global population remain unvaccinated what safeguard is there in place to suggest that we're not going to see the emergence of new variants that could call into question the effectiveness of what we already have how do we know that we don't go back to the very starting point of all of this having to fight new battles against the emergence of COVID and new variants ultimately it's been said a great deal of times that we're not all safe until all of us have been vaccinated and nowhere has that held more true than on a global scale and here's the case that we're not seeing the same synchronized slowdown in global GDP that we saw in 2020 even when new COVID containment measures have needed to be implemented they're being implemented against a backdrop where more activity is still continuing and is protected the bounce back in growth in developed markets the robust growth that we had seen from China earlier all of this has helped it's helped commodity producers the world around and the fact that you are seeing this lift to growth and some of the world's economy no doubt helps prospects for everyone but we need to be careful about how we're going to be managing those risks going forward that's brilliant Durkian I know that you will echo a lot of what Razia just said but let me come to you on the financing angle straight away because I think a couple of bullet points overlap really succinctly as well I spent a lot of time this year I was down at G7 in Cornwall I am going hopefully to Glasgow for the COP26 and a lot of the debate surrounds financing now this afternoon Durkian I listened to an IMF podcast about STRs just to remind myself just how exciting the whole IMF podcast can be not very but it was very important they were talking about the $650 billion worth of special drawing rights despite everything Durkian why is a lot of the financing necessary to get the emerging markets up to vaccination rates that the Western world the developed world is experiencing why is that financing A not forthcoming or if it is forthcoming why is it not translating into better vaccination rates let's first thank you for the question first realize how deep the crisis is I just want to add a little bit to what Razia was saying about the great divergence because the contrast is very very sharp last year I saw the broad collapse in per capita income since 1870 and by the end of this year Sub-Saharan Africa will have regressed to 2007 and the recovery that we see in front of us in low income countries is both slow, fragile and uneven and quite a few of the countries will not return to pre-pandemic levels within the forecast horizon so often even beyond 2026 and that's really having a major impact and it's driven really by the vaccine access and the discrepancy is enormous 1.8% of people in low income countries have had their first dose in middle income and high income countries that's 82% there's a huge spread the second the structural economy means that low income countries because of larger informal sectors much harder hit and then thirdly in the years you're financing thing the ability of the government to actually mitigate the economic impact is very very limited so high income countries were able to generate in fiscal and monetary measures a package of around 20% of GDP low income countries 2% of the GDP so bigger impact a much more reduced ability to respond and that means that some of the quite transient impact and what Paul was describing are actually much more sustained and becoming permanent impacts permanent impact in an employment that's being lost we see most starkly in poverty by the end of this year we have got 163 million people additionally in poverty in extreme poverty and what we're not counting is people were already in poverty and have just been pushed much much deeper into that poverty so and it's not just poverty in income poverty people are losing out on on education non-COVID healthcare is being being diverted and we see systemic risk in terms of debt and conflict so we are really quite concerned about the outlook and the point is this we need to realise that tackling the crisis the pandemic crisis everywhere is a moral imperative it's also an economic imperative the Chamber of Commerce, the International Chamber of Commerce calculated that making sure that every the failure to ensure that everyone is vaccinated is costing the world economy 9 trillion US dollars the cost to actually vaccinate everyone is minute is probably the best investment that we've ever had and I think it's around this inability to understand that connection we're both pandemically related to each other but also economically related to each other now we have a great opportunity and you've mentioned that the SDR allocation special drawing rights allocation of 650 billion US dollar that has been made on the 23rd of August the vast majority of that goes to high and middle income countries only about 23 billion it's going to low income countries but there's now a commitment from the G20 to reallocate about 100 billion of that to low income countries and the question and the challenge is that's coming up at the GA but also at the annual meeting how how are you going to be reallocating that what is the vehicle by which it is most effectively being reallocated and not just how when because if you're going through a long legal process that's going to take a year that will be time lost yeah absolutely look let's just one thing that's really become very obvious already from this conversation is that there is a lack of coordination in the global economic recovery that goes without saying that the different rates of recovery in some parts other parts there is no economic recovery while the vaccination rates are so appallingly low as well but is uncoordinated the same as de-globalized the answer is clearly not but I do wonder if we are living in a de-globalized world and that is creating problems and so with that in mind I'm just going to tell the audience now that we have got a poll which is going to come up not yet I'm going to do one more round of questions but what I want it to do is when we do do this poll and they want to have a little think and vote on this one about whether de-globalization is becoming a prominent issue alongside this lack of coordination we've got we'll come to the poll in about I'm going to go through the panel one more time quickly and then we'll come to the poll after that as well so let me get back to Paul Donovan as well because you would have looked at this as well Paul about what we're seeing trans-pacific as well between the two greatest superpowers of the 21st century at the moment economically as well is it dangerous is this de-globalization concept or actually is it not as big a factor as some people are thinking at this moment in time So to give the classic economics answer it depends I think there are two forms of de-globalization so one is what I would call active de-globalization one is more about localization so de-globalization because of economic nationalism so President Trump's trade taxes for example that is potentially very economically damaging indeed because what you are doing there is you are forcing businesses out of efficient locations into less efficient locations that's what trade taxes do all the time so that to me is a real risk because I think we are for various reasons seeing the rise of economic nationalism it's a very common reaction to periods of structural upheaval and structural change it's always very convenient to blame the foreigners it's very easy to blame foreigners for everything that's going wrong in your country and so that's a seductive route for politicians to take but I think there is also a positive form of de-globalization which is localization where it becomes more efficient economically and critically environmentally to produce locally making clothes to sell in America from Asia is enormously inefficient in an environmental sense because about one third of all clothes in American stores are burnt for fuel because they are never sold and they're never sold because you've got a six week lead time and you cannot tell a teenager that they cannot get their chosen item of clothing but if they just wait six weeks it will be delivered as someone who has teenage feces I know what the reaction is and it's not pretty if you ask a teenage girl to wait six weeks before an item of fashion is delivered so in this world of instant gratification actually producing clothes for the consumer saves an enormous amount of waste it's more efficient overall but it's requiring robotics automation it's capital for labor substitution and that then throws up additional problems because of course it's all very well my saying well this is better for the planet better for the economy it is but what I'm actually doing is putting capital in the developed world to substitute for labor in the less developed world and that then has subsequent repercussions which may well further fuel economic nationalism etc etc so it's a complicated subject but I think overall we will see globalization decline and I think actually part of that economically and environmentally is to be welcomed but alongside that we need to have in place some kind of strategy that accepts that whilst this does create a more efficient economy overall there will be negative consequences that we have to try and work against Thanks Paul a very nuanced answer and again for your teenage diagnosis I will trump that with my pre teenage daughters that isn't pretty either I can assure you the pressure one let's put on that Razia in terms of what this means though if there is a degree of slowing globalization and as Paul was saying very mixed some benefits and other things are quite detrimental as well what does it mean for some of the countries that you've been looking at of course that actually need this globalization in order to grow economically and to prosper Well that's a very important point to reflect on because if we think first of all twofold the confidence that we might have that inflation is just transitory what we're seeing is very much the impact of the reopening of developed market economies and yes there are a few frictions we know that over the Covid crisis the peak of it last year there had been a lot of thinking through just in time supply chains and whether that was really going to work or whether there was a better way of doing this but part of the reason why we can be so confident that inflation will probably revert to the trend that we had seen for the decades in the build up to the Covid crisis was that we know that greater globalization helps to bring about that price competition it had very much been a feature of the increase in international trade the fact that we could look for lower cost suppliers that helped to bring about the inflation which really did boost prospects for very many around the globe and that there is the more direct impact in thinking through the very important part of globalization how is it that we get convergence between different economies over time how is it that emerging markets are able to grow their way through to greater prosperity greater levels of wealth it's through international trade and through being better integrated with the global economy so the real fear that one might have at this point with a lot of questioning of globalization this was a trend pre Covid in a sense exacerbated very much by the experience of the Covid crisis is do we see a disruption to that process of globalization that had led to better opportunities for all and it's very clear we've seen this in the recovery from Covid so far even though it is an uneven recovery even though we haven't seen the same pace of vaccine success the world over the very fact that some developing countries were able to sell to the developed economies that they were able to see the benefits of that trade that they were able to experience the trade gains did help in many instances to create better conditions for global growth so two very important things to think about the prosperity that we take for granted the market optimism are we right in thinking that inflation is just a transient factor that is very much tied into the question of globalization and perhaps the even more important issue that was raised by Paul just now the fact that so many in developing countries will be reliant on this closer global integration on deepening trade ties for the emergence of their own prosperity Durkian I know you're going to want to follow up on this one as well the difference between recovery of high and low income countries is there only one route to market for those low income countries now when I think to the growth opportunities that will occur in the developing world hopefully with a digital based recovery hopefully with a greener sustainable recovery as well are traditional routes to growth and prosperity are they still the same ones they were pre crisis and pre the bigger crisis longer term crisis of climate change well let's look at that one of the concerns I have at the moment and we haven't talked about it yet is the cost of transport that's gone through the roof transporting the container from China to the US has increased 14 fold right so if you're an exporter of relatively low value goods cost of transport is suddenly becoming a major obstacle to growing yourself out of poverty deeply concerned about it and it's not slowing down just yet so that's a major impediment can I just come back to a slightly different point that you make on coordination or not the General Assembly is kicking off this week right and so are we lacking coordination and is there a lack of multilateralism that's at the root of this crisis or can we now see a way forward we saw fantastic work by WHO IMF World Bank to come up with a proposal of 50 billion to vaccinate the world right Biden has just announced this morning he is convening a summit on COVID-19 as a side event to the General Assembly to do just that so we see a resurgence of like multilateralism of collaboration in the world at this point in time India reported this morning they're going to restart exporting COVID vaccines one of the biggest facilities of producing vaccines are actually in India so what I'm trying to point to is that collaboration and coordination way out and I see very encouraging signs just this morning on exactly that what I'm very concerned about is actually about this cost of transport that we're seeing and other costs that are impacting particularly poor people let me make one point on that we are seeing at this point in time record food prices there are 33% versus last year and if you look them in real terms they haven't been this high in decades and that is incredibly regressive and impacting the poorest who spend a much larger proportion of their income so we all talk about inflation about capital goods etc let's look at what it means for the poorest when the cost of food is really going up I just want to remind the viewers we're going to get to a poll in a few moments Paul can you come back to Dirk Jan on that one as well you wrote a book on food inflation you wrote the book on it as well and you're saying this isn't real inflation we are at the end of the cons as well but Dirk Jan they're saying record food prices we haven't seen this high in decades I presume you want to refute that in some way shape or form No in terms of raw food prices absolutely the commodities and this again is where inequality comes in so it comes in within countries and it comes in between countries in a developed country the food that you buy is virtually nothing to do with a farmer because there is so much processing that goes on and you pay for the advertising and the transport and the distribution and so on what you are paying for in a developed country when you buy food is essentially domestic labour cost the farmer does not benefit a great deal from what you're spending when you go to Fortnum and Mason Steve and I speak as a farmer in an emerging market in a developing economy obviously you are tending to be actually quite a lot closer to the food as a commodity concept and so this is where we start to see the splits coming through food prices in the UK retail food prices in the UK are still falling in spite of the commodity prices that Dirk Jan has been talking about of course in emerging markets that's a far more significant problem and that exacerbates the income inequality that we see on top of which of course as we all know if you are lower income either within a society or as a country generally a higher proportion of that income is going on food so your consumer price basket is obviously differently structured and food prices matter a lot more so in the United States in the United Kingdom in Europe what Dirk Jan is talking about is not frankly particularly relevant to most people but in the developing world absolutely this is critical okay great Alton and I'm glad we could find some more okay let's get this poll question done it's on Slido everybody and you can access it via your web application or World Economic Forum application so I'm asking you the question now everybody deglobalization will become a prominent trend this decade do you agree are you unsure or do you disagree you've got about 10 seconds everybody deglobalization will become a prominent trend this decade number two are you unsure number three do you disagree and I'm told it will come up on the screen and we'll be able to see what the results of this are in a few moments time as well but we're talking about deglobalization here as opposed to a lack of coordination and a lack of collaboration and I think just looking it's very slow on my screen I've got all very large in my sky there we go that's better so get as good as you look at as you are Paul right 70% of people of 71% 73% uncertain and disagree only at 14% as well so I think to be honest I would have probably come through a career as well it's just changed a little bit there's been an uncertainty creeping in the longer I talk I think we'll end that now but that's very convincing that most of you out there believe that this will be an ongoing trend does anyone want to just follow up on that either Razia or Durkian Razia why don't you come in on this one worrying trend from the perspective of developing countries very worrying and I think there's a key theme to touch on here Paul mentioned it in a sense when we're thinking of building back greener thinking about how we do things in a much more sustainable manner and the thinking behind this in some quarters that somehow what is more environmentally friendly is about localization it's about not necessarily bringing in the greater transport costs that may be one aspect of it but there is a bigger risk associated with this and that is if we're going for greater fragmentation of trade possibly for reasons a host of other reasons not necessarily tied to the sustainability idea that runs the risk that we are taking away from a very significant proportion of the global population the ability to trade their way to greater prosperity so everything that has worked for populations in decades prior to this how emerging markets got to where they are today are those same opportunities going to be open to the frontier markets with a very low trade share as a percentage of their GDP who are looking perhaps to get greater economic complexity who are looking to change that so it would be good to drill down as to the reasons for that but if we are looking at greater fragmentation of global trade if we are looking at de-globalization actually that is something that takes away from everyone's prosperity okay absolutely if I may move on audience you are on how to ask questions you may ask questions I can hog this as poor man knows from years of being interviewed by me I will ask all the questions on the planet some of them might even be moderately sensible but please if you want to ask a question I hope to put it in I hope so just reminding me you will get your question we have about 10 minutes left as well so I will just give you a couple of minutes to get a couple of questions in but if you don't I will just hog it again and I will hog it now with another conversation about global debt I am obsessed by many of the emails I get in my inbox but one of them on a regular basis is the IIF Global Debt Monitor reassessing the pandemic impact is the latest title that came into my inbox just a few days ago some $4.8 trillion was added to the global debt mounted in the second quarter of 2021 bringing it to an all-time high of $296 trillion the sharpest rise as many of you may be aware it was an emerging market total debt $91.5 trillion in the second quarter Dirk Hian how much of a millstone will this be in any economic recovery I know Paul has his views on disinflation or deflation compared with inflation but at the end of the day we will see a tabering in some sense we hope we think the emergency measures will disappear when that happens is this emerging market debt load going to be an enormous break on growth Dirk Hian yes it's really quite problematic about half the countries are either in debt the stress or at high risk of debt stress at the lower end of the income spectrum and so this is one of the biggest problems that we are facing in terms of financing the recovery if the recovery and the international assistance system has been set up around debt and it is therefore not directed at those countries that need it most but those countries that are most credit worthy and almost there is an inverse relationship between them and every look at where the money has gone the international assistance it hasn't gone to the countries that's had the biggest impact in terms of poverty in fact it has gone to the countries that has the least impact in terms of rising poverty so we are not allocating the international resources because we are debt financing the international assistance so we need to look at a much better way of targeting because 41 dollars gone to the countries the highest increase in poverty per capita and 108 to countries that had the least impact per capita and then what we also see a problem of targeting within countries the people within countries are not getting the assistance that they require so the high level of indebtedness is a problem we try to solve it and has been solved for a period of time through the debt suspension initiative but I am very worried because that is coming to an end by the 1st of January so low income countries will have to start paying interest and principle again from the 1st of January we have just discovered that there are no one near out of this crisis and so that is coming to a crunch and it concerns me greatly I just remind everybody we are in the last five minutes or so here now so I am going to slightly shorter answers if I may on this one we have the same question in some ways Paul we mentioned the emerging market debt there with Durkian as well I mean the developed market debt is absolutely astronomical in some cases as well I was just in Italy a couple of weeks ago at the Ambrosetti forum and nobody talks about 160% debt to GDP anymore whereas 10 years ago it was all anyone talked about nobody even flinks about it these days it is all about common issuance and about the corona bonds as well is it a problem for the developed world as well Paul no I don't think so I mean bear in mind for most of the 20th century most countries in the developed world had higher debt GDP ratios than they have today the cost of servicing that debt again developed world very very low and I think we are moving into a phase where societies are accepting a larger role for government in the economy if you accept a larger role for government you accept a larger debt ratio and Razia of course I'm going to tie two issues in one here because one of your bullet points is about the Chinese concerns accelerating and of course that is topic de jure as well I mean Paul so I was on the French why don't I carry on as well the topic de jure as well because people worried about Evergrande and whether there is a greater corporate debt problem there about financing and servicing and whole host does China have a debt problem which actually could become something more systemic for markets to worry about and to ensure that it can restore confidence it's also an economy that despite everything achieved positive growth in 2020 and went on to much stronger growth by the end of the year so yes we are being seeing that confidence being tested in some respects but we haven't yet seen the policy measures that China's policy makers might bring to address this issue that's a key thing to watch for emerging markets more generally how worried should we be about this everything depends on growth and the speed with which it comes back if we are in a growth environment if the crucial denominator in the public debt ratio is rising growth is rising then everyone will worry a little bit less about the accumulated debt for justifiable reasons and perhaps most encouragingly we're already starting to see the signs of those fiscal reforms the reforms that are aimed at will eventually get to brilliant thank you I've had a question I'm slightly confused about the question but it's basically I think it's saying we're all just accepting passively that there is a de-globalisation going on and we don't have a collaboration outlook for common prosperity as well is that what we're stuck in what are you coming on to are we accepting the de-globalisation and the lack of collaboration is actually what's going to happen now and we're not actually for your passively if you heard the secretary general on the 10th of September speak on this he was calling for renewed commitment to multilateralism exactly because there's so many problems like the pandemic, like climate change that can only result or be resolved collectively so no I think we see quite the opposite at least in the quarters where I work and live to really try to find and coordinate solutions to these major problems that we face I want to just ask you a question you aren't working and living in New York at the moment as well is there a different attitude with the different administration these days as well I see the same antagonism the same concern amongst allies with the Biden administration with the Trump administration I see the same trans-specific issues in terms of economic rivalry as well does anything feel different in New York should be very careful to make comments on the political situation in the United States but I see like with the summit that the Biden administration is just convening there's a re-engagement of the United States at this point in time but let's leave it at that Yeah, yeah, beautifully diplomatic maybe I'll take this one offline or something of course, Doug Yannick, well good to meet you let's have a final round review through as well the biggest risks and the biggest opportunities well, Paul, why don't we start off with you what is the biggest concern you have to your base case scenario I would argue that for the economics it's probably not the pandemic at this stage because I think that the fear of the virus which has most economic damage has been somewhat contained my biggest concern is that we get policymakers reacting to structural change because there is massive structural change going on but policymakers reacting to structural change as if it was cyclical because that doesn't help solve the underlying structural problems and it can make them worse so my biggest concern is misreading structural change as being a cyclical problem what is the biggest structural problem Paul, just very quickly I think that the fourth industrial revolution is going to lead to an increase in prejudice in society economic nationalism and you need to concentrate on tackling labour market problems to try and contain that as much as possible yeah, let me just echo your concerns that as well of course we haven't had a chance to talk about a lot of those issues but you know I share a lot of your views on that one as well Razia Khan what are your biggest concerns about society going forward economically now if we were to grade ourselves on the multilateral response to the Covid crisis I'm not sure we would be giving ourselves a wonderful assessment but what we do is really the climate crisis the climate transition what needs to be done what needs to be done around financing having got it pretty wrong in the case of Covid although there is a realisation that this situation needs to be improved on can we really do it that much better when it comes to the environment now you may push back with the idea that perhaps this is something a risk that lies well into the future we all know that we don't have the luxury of waiting the big challenge facing everyone developed and developing countries alike can we come together can we have a multilateralism that works for everyone in terms of tackling the climate crisis Doug Yang there's an opportunity here as well as risk as well do you want to address both of those absolutely so I think the risk is that the international focus has moved on from the crisis because it's no longer on top of the news so that the vaccine inequality is not being addressed that the food price are not being addressed that the SDRs are being very slowly reallocated and that giving rise to systemic risk we know that for example violent conflict is related to economic contraction and rising unemployment and having children out of school at the same time I see a real opportunity and I see a real commitment we can convince the world to go around anticipatory action and we found that 75 countries made a really true commitment to act ahead of predictable crisis and that instead of waiting for a crisis to happen we're now acting ahead of it and that is a change a systems change that you'll hopefully see take root brilliant well look three fantastic economists given us lots of different views thank you very much indeed of course I think that's the leading of what's going on structurally in the global economy and the prejudices that could happen the policymaker mistakes over tapering Razi you raised the issues of concern but can we do better on the broader climate concerns compared with how we've fared on the vaccine distribution and the financing of that one as well and real opportunities there as well to address these food price issues these inequality issues as well vaccine issues well highlighted by Durkian as well at the UN office for coordination of humanitarian affairs thank you sir head of research chief economist Africa and Middle East lovely to hear from you again thank you very much indeed and Paul Donovan thank you sir I just want to hasten to add I haven't been informed my masons in the last 25 years not since I was a trader global chief economist at UBS management at UBS AG thank you very much indeed