This is an English translation of the transcript of an interview between Emmanuel Macron, French president, and Roula Khalaf, editor of the Financial Times, and Victor Mallet, the Financial Times’ Paris bureau chief. This interview took place on April 14 2020 and was conducted in French. You can read the interview in the original French here.
Financial Times: There has been some discussion, especially this week, about the effects of the virus in the developing world, and you are particularly concerned about Africa. What are your ideas on this and your priorities to tackle the crisis at the international level?
Emmanuel Macron: Regarding that question, if we look at it today, this virus is affecting us all, it has started in Asia and has had its epicentre in Europe. Today, its epicentre is in the United States and it is spreading worldwide. All continents have been hit by it. Clearly. Africa’s main challenge is first of all its vulnerability. Considerably weaker healthcare systems, diseases which we haven’t been able to eradicate, that was the fight we had lead with the World Health Organization last year. HIV, tuberculosis, malaria are still very present with weak healthcare systems. Africa has also been shaken up by climate changes these last few months and years, more so than previous ones. When we look at facts, Zambia has had its worst drought since ‘81, cyclones have hit Mozambique, we’ve had locust invasions which have subjected 20m people to famine, so we are left with an Africa that is, along with Oceania no doubt, the first victim of climate change. We have an economic environment which has degraded over the last ten years.
Let’s talk numbers. If we consider the debt-to-GDP ratio, it has gone from 30 per cent in 2012 to 95 per cent in 2019. And today, on top of that, debt servicing that represents a third of exports. And we also have other serious phenomena currently weakening Africa. The fall of oil prices for a lot of countries is a drop in their sovereign income. From Algeria, to Angola, as well as many others such as Mozambique. A drop in commodities prices is hugely affecting African countries, from cocoa to tuna among many others. A drop in tourism, which is more than 40 per cent of Cape Verde’s income. You are therefore left with an extremely weakened Africa on an economic, structural and demographic level and yet its population is still growing. And I was looking at the [UN] Economic Commission for Africa, it was talking earlier about 3.2 per cent growth for the African continent with the population growing a little more than 2 per cent. And now It is supposed to enter the recession as we speak, before the major impact. That means we have a huge African crisis. And in the midst of this situation, the virus arrives. With very weakened healthcare systems, lack of supplies — and when you consider that very economically developed countries are having serious trouble handling the virus, we can only worry about Africa, and as I was saying yesterday to the people of France, we cannot fight this virus which circulates among the men and women of the world, in an open world, if we don’t help Africa, which cannot handle the virus by itself. On a healthcare and socio-economic level and therefore on a human one. So first what I wanted to do was to convince G20 leaders and so bring to the G20 an initiative for Africa when we met up a few weeks ago.
And then, because I believe the only thing that can work is an initiative supported by Africans, 10 days ago I was invited by the African leaders to join an African Union meeting, by President Ramaphosa and several others, and that is when I spoke of this four-step plan. First is the health pillar, basically how do we help you on a very short-term basis, to acquire the materials, to increase your capacities and to help you deal with the urgency of the crisis. We have the money from the Global Fund, we received last year’s replenishment in Lyon, 14bn. President Kaberuka, who did an amazing job with PIIE, has agreed to use part of this money to go with it. Which means, immediately, to help with the healthcare response, to co-operate, to bring money in order to move fast, with WHO’s support and some other funds. So a hyper-urgent answer. We then must go even further with the health issues, we must go further and that is what I hope we will manage to push forward a lot more in the G7 and the G20, in other words, we must of course — and for all countries, but we can come back to this later — speed up the research and production of a vaccine. But while doing so, we must guarantee access to vaccines and treatments to the poorest countries.
So to make sure that the CEPI which has been tasked with this measure, GAVI, UNITEL and the WHO work together so that everything developed countries can produce for themselves and their population, can be immediately accessible on the African continent, be it treatments, at the lowest cost, or a vaccine, which as soon as it is discovered will be mass-produced. There should be a complete change in the logic we have had so far, in order to be able to vaccinate an entire continent. Because in general, we do it in sequence, but we must now do it together if we want to win against this pandemic. Because if we do it in sequence and we take six, twelve or eighteen months to help Africa receive a vaccine or treatment, we might be able to treat or vaccinate our own populations, but with the diaspora, and circulation, we will get recontaminated. And so we must completely change the scale of things in terms of volumes and times. And that is a massive initiative, so we must put a lot on the WHO, because we need around 30bn to succeed and to bring all these platforms together, and install at the core a COVID-19 health platform for Africa and poor countries, in order to move a lot faster.
There is a second pillar for Africa which is the economic one. I already mentioned as I was reminding you of the numbers, how vulnerable Africa is. Bearing in mind what Africa is going through, if we want to help, we must take a look at what we did for ourselves. The Fed reacted on March 3, the Bank of England on the 11th and the 19th, the ECB on March 18 with comprehensive plans, what could almost be considered helicopter money where central banks bought sovereign debt on the secondary market, took commercial paper and went with a massive and unprecedented monetary response.
Alongside, we have Chinese, American, European governments, which have invested trillions to help their economies. Given the numbers I have just stated, Africa can’t make it. What equivalent do African and other developing countries have, given the relative weakness of central banks, which cannot have such an impact and which are therefore a lot more vulnerable and are facing macroeconomic shocks and outflows of capital? The only answer is on the IMF level, the special drawing rights. Among other things, the role for Africa, which central banks have played for us, is with special drawing rights. And I support the initiative, of course, of a massive increase of special drawing rights of at least €500bn with a real contribution for Africa from other quotas in the short term.
FT: The FT agrees with you on the need to help Africa.
EM: It’s the only way, because they don’t have central banks that can afford to do it so we must undeniably go in that direction, and by the way, let me remind you of the numbers on debt servicing. A third in 2019, the equivalent of one-third of Africa’s commercial exports is debt servicing. So we must very rapidly obtain a moratorium for this debt. It’s the goal I have set for our finance minister at the G20 finance meeting which is happening tomorrow, and I think that we can manage it, and we were able to convince the Chinese and the Gulf states to go in that direction, which means to have a moratorium, thus stopping the debt servicing and building connections. That is unprecedented, we have never managed it before. We need to go further, to go with this dynamic and stick with a logic. First, keep the moratorium, but when looking at African countries, know how to restructure good debts. The Paris Club was always the first to meet its responsibilities on the subject, simply, the debt restructured by some has enabled new deals for others. And so today, creditors on the African continent, which means those in the Paris Club, but also in China, Russia and the Gulf region, and sometimes even others, must sit around the table and accept, beyond this moratorium, to give back some financial oxygen to Africa.
The third major pillar of this initiative for Africa is humanitarian. Because of a mixture of health, climate and economic shocks, in a lot of regions, populations do not have access to food. And so with this food program, the role of the UN, we must undeniably have a human approach, to help these more vulnerable regions, with the NGOs, with the UN, to gain humanitarian access.
And this last pillar, it’s academic, is research. That is why the African Union platform, with all its regional arms, is so important. It’s to show how we can help the field of research, the academic world, healthcarers in Africa with centres of excellence today spread across the continent, to benefit from what we have learnt during this crisis in Asia, Europe and the United States, to benefit from the research done in clinics and the like, and to have a real African platform of answers, and thus show us their ability in terms of medical research. They are the four pillars of the initiative for Africa which is not only essential for Africa, but for us all, as our fates are intertwined during this adventure.
FT: Although you have campaigned for a long time for this multilateralism, what we noticed during this crisis is that there is very little international co-ordination. It seems to be moving now but it certainly was not at first. Does that not suggest that multilateralism and globalisation have been weakened by this crisis?
EM: It’s too early to say so but I think we must tackle this crisis with a lot of humility. Generally, the owl of Minerva takes flight at dusk. So it’s when the event is over that we can, with the utmost wisdom, draw some conclusions. We must be . . . I am not able to say whether we are at the beginning, the middle or the end. No one can. There is a lot of uncertainty and that is something which must make us very humble. There was a first phase to start with, in truth a national response because health is a national matter. And because when people are scared, they turn towards the institution of the state and react in that way. And I regret the lack of co-ordination we’ve had at first regarding border shutdowns among other things, it’s true. If we must draw some conclusion it’s that we must strengthen our multilateral health governance. And it seems that when the crisis is over, one of the lessons we can draw collectively, is to ask ourselves “What is it that we’re doing right or wrong when it comes to interacting with one another and what can help improve our health governance?”
Markets for instance, which mix living animals and humans, are they good for global health? It appears that a lot of diseases have sprung from them. So we must try to regulate them as best as we can to improve global health. But because learning from others’ experiences is important, I must point out that some countries reacted a lot faster when it came to social distancing, wearing a mask as soon as a problem showed up. All this to say that to come back to Asia, they have habits that Europe doesn’t, abilities to answer a crisis immediately, but at the same time other ways that may not be very good for global health. I’m not drawing any conclusions but it is clear that there are some good practices we can learn from one another. And so I believe that we should do a feedback session once this crisis is over to improve global health governance. But it’s true that at the beginning of this shock, we lacked co-operation, even though there was some support. When China was first hit, I was in contact with Xi Jinping several times, we have sent them material, masks, etc . . . to help China, and when we were also hit by the virus, China helped us. And so there was this reciprocity of aid and we have had it with many others. But it is a test of multilateralism.
I am not that sceptical, I believe it is a chance for multilateralism. Because perhaps multilateralism needs change that might actually have started happening. I believe it is. I don’t want to jump to any conclusions, but when I look at what we have been living for the past years, together, we have gone through a very big crisis, terrorism. There have been threats all over the world, which have affected all continents. There was also a change in the migration phenomenon which shook stability a great deal. Then, there was a profoundly new phenomenon, which was, in its strongest expression at least, a climate one. We have the technological phenomenon, and now the healthcare one. Ten years ago, we went through an economic crisis unprecedented before this one. At least it sheds light on the fact that we are in the end very interdependent. Only the crisis we are now living through — and there are parallels here with the ecological crisis — is that humans are put back in the centre of the frame. No one questioned the fact that in order to save lives, we had to put the economy to sleep. And no one thought it possible. And I think it is a shock, a very deep anthropological one I would say, and we have put half the planet on hold to save lives, it is unprecedented in our history. So it will have clear, anthropological consequences I would be unable to describe. But it’s going to change the nature of globalisation.
The globalisation we lived through for the past forty years, a globalisation made of exchanges, people, knowledge etc, we were under the impression that frontiers no longer existed. But deep down, it was about faster and faster circulation and accumulation. With great success, it has dethroned totalitarianism, there was the fall of the Berlin Wall thirty years back, and with some ups and down it has taken hundreds of millions of people out of poverty, but it has also increased inequalities throughout developed countries, especially in recent years. And this globalisation, we can definitely feel it, has gone full circle. Because it was weakening democracy, as I have mentioned several times, by increasing inequalities in our countries. Because, and that was the result of that globalisation, the consumers and financiers were the key elements. I believe this shock we are currently going through with many others will force us to review globalisation, and bring us to rethink society’s terms.
We have seen that we needed to reconsider things we sometimes believed were worthless. We thought a mask or an medical overall had no value on a global commercial level. But it has value since it protects caregivers, and we acknowledged it during this crisis. It’s worth only 40 cents, not even a euro, but it becomes immensely valuable when we start running out of them and unable to produce enough. And all this will send us back to a culture — I have defended it several times about other subjects, I hadn’t seen that one coming, I admit it humbly — but what is sovereignty? Which means, within this globalisation, what must a state, responsible for its own people, decide to do? Regarding healthcare, industry, technology, military and I won’t name everything today, but there is that. And so this globalisation which we have in front of us brings us to reconsider the terms of sovereignty. It puts the human back in the middle. It’s clear that economy is no longer the priority. And when it’s a matter of humanity, women and men but also the ecosystems in which they live, and so CO2, global warming, biodiversity, there is something more important than the economic order.
And at the same time, we are starting to understand that we are interdependent. That is also something the crisis is revealing. And I think it’s forcing us to review the grammar of multilateralism. Multilateralism was threatened because it was in the hands of hegemonies. Or in the hands of higher powers which did not want to abide by its rules any more because they could not find their interests in it. When globalisation became once more a question of interdependence, we started to understand that some things are a matter of sovereignty and so a matter of states, not other powers, and at the same time there are also things cannot be reduced only to the nation state but are a matter of the common good, education, health, climate and biodiversity and so then you have the fundamental grammar of something forcing powers to co-operate. Because they think “I cannot surrender something that is crucial to my sovereignty to great economic powers, and to major actors whoever they may be, or to a sort of fluid world where everything can be traded and nothing has value any more, and I must be able to answer to my people and co-operate with others because we are interdependent and we all have common assets.” That is what we are seeing.
So I believe there will be some major anthropological changes which I am unable to describe, and I say this with a lot of humility, but there will be profound ones, I am sure, but as we are rediscovering it, there are some elements of sovereignty, there are some elements of national sovereignty, strategic regional autonomy and there are some elements of global interdependence which force us to rethink a true governance and therefore multilateralism. Health multilateralism, political multilateralism, peace and ceasefires. That is what we have brought to the P5, we might reconsider it next week and there is also a multilateralism, which I hope we will manage to rethink, regarding subjects such as climate, commerce. So I’m not as pessimistic as you are. On the contrary, I believe that we are about to exit a world which was hyper-financialised in a way, where there was financial hegemony and hegemony of the non-co-operative military powers, and we can enter something which will enable us to reshuffle the cards. When people are scared of death and come back to these deep existential subjects, they co-operate. Multilateralism has always lived its finest hours in the aftermath of great world wars and I believe that we are living a great global shock, and I think it’s time to rethink multilateralism.
FT: I would like to come back to some of these themes. But western democracies appeared as the most vulnerable, and the least prepared — Europe, the United States for instance. Do you not fear that this lack of preparation and of resilience of health systems may have shocked many among our population, and may give credit to the stands taken by Russia and China in particular? China has recovered from the virus quite well. Will this not strengthen the hands of those who say that authoritarian systems are better prepared to handle these existential crises?
EM: I feel like saying yes, absolutely, if you believe that in order to handle an existential crisis, we must overlook free and transparent information. Because the real difference between all the countries you have mentioned, is that information is free and transparent, and I would add, immediate. And that is not the case in China, nor in Russia, therefore we can’t conclude that the situation is better handled in China or in Russia. It simply means that no one has access to free and transparent information. But I do not think that means it was better handled, all I’m saying is . . . As you may have heard, some people said is was a catastrophe, some bloggers said it was terrible, and then didn’t say anything. So I believe that we must pay attention to the narratives which are settling down and which are very political. I have the greatest respect for President Xi Jinping, and I expect no less on his behalf, but we cannot become the vulnerable ones here because of our democratic systems. I believe in co-operation between all powers, I deeply believe in the co-operation with China, in strategic dialogues with Russia, but I don’t want to be hypocritical in that dialogue and have never been. You do not mention any countries in which the information is free, transparent and democratic. And they know it, and we know it and we can speak openly of it. So you can’t compare France, Germany or Italy’s situation with China or Russia’s, it’s obvious. And the transparency you may find, the immediacy of the information bears no comparison with ours.
Social media are not free in those countries, you don’t have any social media. You don’t really know what’s going on there. So I believe we must keep track of what is essential and not compare what is not comparable. So I believe that when bringing up these subjects, we must always place them in context and there are some different systems. And I respect them, I’m not saying China should end up looking like the United States or France. But I am saying that given these differences, the choices which have been made, and what China is like today, and which I respect, let’s not be naive either and say it is handling things much better, we don’t know that for sure. And there are obviously some things happening which we don’t know about. It’s up to China to tell them, it’s a great power and it has great research skills. I have a lot of respect for them and we are co-operating on that, I don’t want to compare the way we both handled the crisis in those different geographical locations because they are not comparable. And then, we have western democracies where social networks are open, where there is freedom of speech, because that is key in the end. During a crisis, what makes the difference? The fact that you have social media, continuous channels of information and freedom of speech. It’s very important, it’s our DNA. Western Europe, the United States have to tackle crises in this way.
First there is a key issue, I believe that giving up on that to handle the crisis is a crucial problem for our democracies. Some countries are making that choice in Europe. And I believe it’s wrong. And that we cannot accept it. It’s not just because there is a health crisis that we should give up what makes our DNA. I said so last night to the French population, that I believed it was a profound mistake. Some do it out of cynicism or without thinking, I believe it’s a mistake. Then, I took a look at the differences. We must have utmost solidarity with Italy and Spain, because among European democracies, they were the first to be hit hard by the pandemic. And they have handled it with a lot of courage and bravery, and if I may say so, they have picked up the broken pieces for the rest of us. They are the ones who taught us and I will have infinite solidarity for these two nations, which have had to face all the challenges and which have understood things no one had before, because we did not hold all the information, which is also why I am pointing at these differences. We did not know what was going on beforehand. And they have had to live through it and deal with it. And we were badly hit because there were major movements of contaminated people, but then it is also bad luck when a country is hit harder than another. But we benefited from the learning and co-operation of these two countries.
And I say this with a lot of humility. And if France and French hospitals were able to truly handle and support all the people who showed up, it’s because we had learned from our neighbours and friends. And thanks to what we are now learning, I hope that neighbouring countries which have yet to catch up on us regarding the pandemic, will be able to learn and react accordingly in the best way possible.
So in this context we must have humility. Everyone was caught by surprise. If we had not been surprised we would not have shut down our countries. And all highly infected countries were forced to proceed to this lockdown. So no one can say they were not caught by surprise, it’s not true. We are more or less hit by what we thought we could control in the beginning. And I can say me managed to do so for a while before we got a high number of infected people from the east of France which made the epidemic flare up. And so we must hope that all countries which have avoided this phenomenon may manage to handle their situations. And then two choices were made. Some thought we could go towards herd immunity and let the virus spread and they soon realised that was not a sustainable strategy. Because this pandemic is spreading very rapidly, and even though its mortality rate seems low, it hits all age groups and sends about 10 to 15 per cent of the infected people to the emergency department, which is obviously traumatising for everyone and puts great pressure on healthcare systems.
So in light of that, I think no one in the world is spared, we must show a lot of humility. Western democracies have reacted with a lot of transparency on social media, hence the democratic criticism that we have today. We must consider it with a lot of calm and patience, and not see it as something which would question our democracies’ ability to handle the situation, but rather as an element which will teach us how to handle the crisis with permanent questioning of the debate. And I find it very good. And it was theorised some years ago by many people. It’s the power of democracies. We should not allow ourselves as citizens of free democracies to be hypnotised by the way authoritarian regimes handle crises.
I don’t think this is the right method at all. And I also believe that we learn from that. And I also believe that we learn from one another. We are deluged with information but we look at what works and what doesn’t. [In] such a context everything is extremely horizontal, [but] at the same time there are moments of verticality where you decide. But you learn and that’s fine. Simply, we must avoid falling into a sort of moral collapse of permanent argument and criticism which means that a certain point we end up denigrating ourselves. I think we must learn to separate what is fair criticism and democratic debate from self-denigration. I do believe in Stoic virtues: we must keep self-esteem by accepting permanent debate. That is the strength of democracy, so please, let’s keep that in mind.
So then, what makes it so that we are well prepared for such a pandemic? First, political prevention. In France, over the past few years, I did insist on that point quite a lot. Despite it all we are not prepared enough. None of us completely is, but I believe it’s one issue where we should come out stronger. Better prevention. Further improve hygiene policies everywhere to break the viral chain in our country. Second, I think we had underestimated the risk of a viral pandemic in Europe and in the United States because during the last ten years, these pandemics had stopped in the Middle East. Asia was badly hit by some viruses like the COV-MERS which then spread to the Middle East before stopping there. And that is why some countries, like South Korea, have learnt a lot from these crises which they had suffered these last few years. Us, less so. Now, we see that these shocks, we used to have these plans called NCB, these plans for which we thought “We’ll be attacked by chemical weapons etc …” Everyone said that there was very little risk. But that will put great pandemics back up in our priorities and it’s not the flu plan as some have said because these are pandemics, very strong ones, for which no vaccine has yet been found.
That’s the major difference. To deal with a pandemic when there is no vaccine, it’s handled very differently. Because that means that we have to handle the psychosocial phenomena as well because when there is a vaccine, people are not scared. Now they are. So, the second thing, we will have to put that at the top of our list of issues. And then about the question of ethics and our healthcare systems. Are we underinvesting in the health sector? Honestly, I had started reinvesting two years ago. But I’ll be very frank, even about my predecessors, France is not a country that underinvested in health. When I look at numbers, it’s not true, we are one of the countries investing the most in health, I think we can do more and we will, but we were not massively underinvesting in the healthcare system. We were catching up on hospitals. I think in order to do better we must do better by hospitals, I was about to say we were going to do so massively and at the same time get better organised. But we must be humble. In the aftermath of the 2010 financial crisis, we have pushed some countries to do some cutbacks in those sectors. We must also think of that. Because it’s easy to draw conclusions from what we did on the short-run. But if Spain and Italy made cutbacks on education and health, who actually demanded that from them? Everyone else, while telling them “We are helping you in the midst of a financial crisis, you must make an effort, you are spending too much.”
FT: There has been a lack of solidarity at the beginning with health equipment, but now there is talk of being supportive on an economic and financial level which has not quite been the case yet — an investment fund in order to complete an economic revival which could be funded by the common debt of the entire euro zone, or by the European Union. And it does not exist for the moment because there are the Germans and the Dutch who are still opposed.
EM: It’s the moment of truth.
FT: What are you doing about it?
EM: First, regarding health you are right. We were all under pressure because of equipment being produced outside of our territories. And so we were all . . . It was hard to help Italy with equipment when the shock arrived because we were all lacking some. So we made an effort, and delivered millions of masks to the Italians. We have committed, I will deliver respirators. And so there we have solidarity. I am quite proud of the fact that France did not close its border with Italy. At no point did we give in to
that, when sadly others did. Because I consider that it’s pointless and we owe that solidarity to the Italians. But when the crisis hit, first in Lombardy and then in the rest of Italy, it was hard to have . . . We should have done it then, but even Italy was not able to organise a patient transfer that fast to other less-affected regions. Something we in France were able to do in the end from the Grand Est region to other countries that I was able to thank, Luxembourg, Switzerland, Austria, and Germany.
And so we improved European solidarity, but I don’t want to point fingers. At first, there was a national withdrawal, too many countries sealed off their borders and merely continued handling the crisis at a national level. Then there was solidarity regarding patient transfers. France benefited from it. Now we are at a crucial economic and financial point. But it’s essential. Because we have reached a point, we must be clear on that, as I have said several times, where the shock we are going through is not a asymmetrical one resulting from the mismanagement of such or such a person. It’s an asymmetrical [sic] shock, an epidemic which has spread throughout the entire world. I must add that the reason we have negative externalities in Italy and Spain is because we are learning from what they have been through. How much does it cost? How much is it worth For Germany, Finland and France that Lombardy has been hit several weeks before and that we learnt they were sealing off because of that? It’s worth something. But behind that, it’s the very way Europe and the eurozone functions.
Today, we work within the European Union and eurozone without respecting our treaties. Because our treaties forbid state help. And today the system works as if there was some state help. Because we are all bringing guarantees to our companies. These guarantees were based on a sovereign signature, massively. Today, can Greece and Spain bring the same state guarantees as Germany or the Netherlands? No. Distortion is not usually permitted by treaties in that case. But intellectually, what I’m saying is true. We never presented it as such, but it’s the truth. I will put France in the same boat as Germany . . . I can bring guarantees to my companies, and I am doing it. Greece can’t afford as much. Spain and Italy can’t afford as much, it’s not fair. It’s a distortion.
So today, I have a problem. Secondly, tomorrow, the shock we are currently going though, do you sincerely believe that they will be able to absorb it given their starting point? No. And so we need financial transfers and solidarity, be it only for Europe, so that Europe can carry on. And countries which, today, have a financial solidity are the countries which when it comes to macroeconomics are the net beneficiaries of the eurozone and the European Union. We never do the math. But it is done by the OECD and by the [European] Commission. Look at the graph that the Commission has done. They are the countries that are by far the biggest beneficiaries of eurozone and the common market. We can’t have a common market where some are sacrificed. So we are at the moment of truth when it is no longer possible — I’m not talking about [the debts of] the past — to have financing that is not mutualised for the spending we are undertaking in the battle against Covid-19 and that we will have for the economic recovery. Because we are facing a real strategy of recovery. We need to have a relaunch.
What are all of us doing in the end? To put it in terms that the readers of the FT would appreciate, we must nationalise salaries and the P&L of almost all of our companies. And that is what we have done. Our economies, the more liberal ones included, are doing that. It’s against all dogma but that’s the way it is. Short-time working means nationalising salaries. In order not to stop activity and not to let skills slip away. All plans of guarantee or help which have been done, the €50bn German fund or the €20bn French fund for traders or the like, that is called nationalisation of operating accounts for business and commerce. That’s what we are doing. In order to avoid seeing it all go up in smoke, to avoid collapse. We will also have an exit plan, and probably a relaunch plan which must be coherent with what I was mentioning earlier, on a health and ecological level. It’s impossible to leave this to single nations. Impossible because it’s not sustainable.
FT: But the Dutch and the Germans are not ready to do so . . .
EM: I think they’re evolving. I’m in constant dialogue with Angela Merkel and Mark Rutte. I think the notion of moral hazard is important to them and I can sympathise with that. Some countries are making efforts, other are not, we can’t treat them in the same way. I’m not saying that we must cancel all previous debts. I’m saying that in order to continue a shared journey, we must go forward with it. And each time we have faced such moments in history, when we said that the people who had sinned must pay, a hundred years ago, we made that mistake. A hundred years ago when France came out of World War 1 it said “ Germany will pay ». A colossal, fatal error, . . . that led to the rise of populism in Germany, hatred on behalf of the rest of Europe, and fifteen years later, the worst happened. It’s a mistake we avoided after World War II, we said “ There are some debts — Marshall Plan. ” The Marshall Plan, everyone still speaks of it today, because it’s what we now call “helicopter money”, saying that we forget the past, we must start again and look to the future.
FT: But is that what is really happening with regards to Italy?
EM: To be very honest, we have no choice. The subject is the unravelling of the European project or moving ahead with it, there is no choice. So call it what you like, monetary fund etc . . . I’m not a fetishist when it comes to deciding what we should call it, it could even be called the European budget, or the multiannual financial framework, the MFF. The key thing is the ability to issue common debt, to have a common guarantee, to fund expenses in certain countries. This funding cannot be set according to your level of GDP or what you have contributed, it will be done in accordance with your needs, because we decided to have a shared journey. If at this point in history we don’t do it, there will no longer be any shared adventure.
Because if we don’t do this today, the populists will win. Today, tomorrow, the day after, in Italy, Spain and maybe even France and in other places. And in countries which are still against it today. It’s obvious because they will say: “What is this adventure you are offering us? These people will not protect us in times of crisis, they won’t protect us the next day, they show us no solidarity. When migrants arrive, they ask us to keep them for ourselves. When an epidemic arrives, they ask us to handle it. They’re great really. They are all for Europe when it’s about exporting to our country the goods that they are producing. They are all for Europe when it’s about having your labour and your markets and producing car parts that we no longer make in our own country. But they’re not for Europe when it comes to mutualising debt.” That’s nonsense. But it’s the reality. So we have reached that moment of truth when we must know whether or not the European Union is a political project or strictly a market plan. I believe it’s a political one. When it is, humanity is placed at the centre and notions of solidarity are put into place. And that also goes for the aftermath. The economy follows on from that, let’s never forget that economics is a moral science. But when everything explodes, your P&L explodes with it, and that is what we are currently living through.
And so the beneficiaries of this common market or of the eurozone will no longer benefit when there is no more common market or eurozone. So in any case we must go through with this solution. We have some first responses which have been mentioned and which are good: the Commission which is financing €100bn worth of short-time work [temporary unemployment schemes], reliable mechanisms, the EIB mechanism where more money has been provided to support businesses and big projects, the ESM with its mechanism for immediate use. But the length and extraordinary nature of the crisis means we will in any case have to break new ground. And for that new approach, once again I don’t care much about the vehicle or who runs it, we have a European Commission which is for running our joint affairs, so I’m more in favour of keeping this matter simple, but that means to say that we must join forces and collectively guarantee the possibility of finding money to fund the costs linked to the exit from the crisis.
FT: And if that doesn’t happen, is there a real risk of a collapse of the eurozone?
EM: Yes, let’s be clear on this. And of the European idea. I don’t know in what way it would begin, but it’s obvious [that it would].
FT: But you remain optimistic that Rutte and Merkel’s attitudes are changing a little?
EM: I think that everyone is starting to realise, I hope, the magnitude of what we are currently going though. We are in the midst of this crisis and it’s hitting the whole of humanity. It’s making humanity do things that it never thought would have been possible before. Bringing economies to a halt, limiting social interaction, basically restricting what makes us human, what makes our societies. We are therefore living in what was six months ago unthinkable. To think that we will be able to come out of this and find solutions based on the habits of the past, I believe that’s cognitive distortion. I’m unable to say how this crisis will end on a healthcare level. I’m saying this with a lot of humility, nor when it will end or what its consequences will be, and that includes the psychological impact on the country. And anthropological impact. How will we come out of this when it comes to our interaction with others and our perception of society, our relations with the rest of the world? Are the nomads that human beings became in the 21st century — imagine . . . You have a billion and a half people who travel each year.
Humankind had never witnessed that before. We were a humanity where there was permanent dissemination of information everywhere. Where a billion and a half people at least were constantly circulating and where everything was being exchanged. And suddenly, you enter a humanity where everything is fragmenting, where what we thought was worthless, becomes scarce and must be produced in other countries, and where we tell people they can’t even cross the street. It’s a profound change, from which we will all come out different, and we must consider this with a lot of humility, but a fortiori, what we know for sure, is that we don’t need to wait for all these changes to happen to come up with the right answers. So I don’t want to add to this real shock we are going through, nor to the post-crisis trauma we will have to experience, nor to the anthropological changes which will be ours, a sort of delay in our action [to tackle] events that are almost certain to come to pass.
FT: You spoke in your speech this week of a new economic model, of the need to rebuild an agricultural, health, industrial and technological independence. Is that not a rather national, anti-globalisation reaction?
EM: As I’ve always said, I don’t believe in the absence of sovereignty. Because what is sovereignty? It’s the idea that the people are not just consumers or producers, they are citizens, and they want to start controlling the choices they make. And that goes for all countries. And the basis of sovereignty is that it structures our balance, and you actually see that during shocks, like an epidemic. When you are afraid, you don’t turn towards Amazon, Google, globalisation, you don’t turn towards the secretary-general of the United Nations, the European Commission etc . . . You turn towards your country. I think we must co-operate, but you turn towards your own country. I think that is sovereignty, the Leviathan protecting us. So that’s it. But at the same time, once people are protected, they want to decide their own fates. Globalisation leads us to open up and to co-operate but it doesn’t only result in that, thankfully. Because if it did that would kill the idea of a democracy.
FT: But now you are talking about the necessity of making products in Europe itself?
EM: I’m getting to that, but what I’m saying is that we have operated and struck a balance for centuries, starting in the 18th century. This notion of political sovereignty and political liberalism with economic liberalism, this theory of competitive advantage which means (and world trade is built on this basis) that I produce goods in my own country but if some goods are produced elsewhere, then I can trade them and there is a profit on both sides, because there is a competitive advantage for both of us on what we have produced — and that is how our economic specialisation was developed, and this specialisation with free trade has enabled the world to get richer, to disseminate links, and has enabled this unprecedented phase of globalisation, which we are currently experiencing with ups and downs, good times and bad times, since the 18th century. That is the long time-frame we are living in. One of openness, free distribution, expansion etc . . .
This globalisation was reinvented in the 20th century, the beginning of the 20th century, but it has had real impacts during its first 60 years. It has made it possible to reduce conflicts, and to bring, depending on how you count the numbers, about 700m people out of serious poverty. Amazing! However, it has immensely increased these last few years. It was met up with financialisation and digitalisation, which makes it so that this globalisation of container ships which had increased and has increased global trade from the 1960s to the 1990s, has become the globalisation of finance and the digital economy since the 2000s and it’s obvious that it’s starting to overheat and that this globalisation has a problem. And several signs are already point towards it. Why? Because the way I see it is that there are two major problems: it creates inequalities in developed countries and it’s being joined by the rise of a power game in which people rediscover the grammar of sovereignty. Those are the two major phenomena we have been able to observe in the last couple of years. And these two phenomena deeply impact globalisation’s sustainability.
First, the inequalities in our societies. What started off as being simply misunderstood — delocalisation (offshoring) — is now unsustainable. It leads to Brexit, to the rise of leaders among us, and to a general questioning of globalisation because the middle classes and workers are saying “I don’t see myself in this globalisation. I am sacrificed to it.” And for quite a long time, to make it simple, the average consumer said “Well, in truth with globalisation, I can buy cheaper things but I don’t have any work, because there is no more space for me in this society, it’s society for the super-talented, and what I can do is no longer valuable.”
Now we have a problem. And it’s true. And in my opinion we have reached a limit when it comes to specialisation, to this theory of competitive advantage. And the level of inequalities in our societies, as I was saying, in a country where we correct them ex-post through tax and social welfare. France is a country where the political dialogue and social phenomena react severely to inequalities. When I look at the numbers, the Gini coefficient or others, we are one of the least unequal countries. France’s problem is rather be the way the inequalities are constructed, which is why we must correct it through education and social policies, but that’s the creation of inequalities. Ex-post, after redistribution, we’re one of the least unequal countries in Europe.
FT: Because of higher taxes?
EM: After taxes yes. It’s a fact. But we are experiencing these inequality problems in our democracies. Which makes this globalisation unbearable. And I’m saying this because it weakens things, because our democracies were built with three legs: progress for the middle classes, individual freedom, and democracy. And the social market economy. That’s more or less the structure. It’s currently eroding because when you no longer have improvement for the middle classes, the middle classes no longer go with it and either they say “we must close up” or they say “we must give up democracy and go towards something more authoritarian but which will protect us better”. That’s what we’re experiencing with western democracies, and tensions on these other subjects. And on the other side you find the rise of powers which are rediscovering the grammar of sovereignty. China knows what sovereignty is. When it’s making technological components, even now as it is making masks, it knows what sovereignty is.
The United States know what sovereignty is when they produce the Cloud, when the GAFAM produce norms, when the ITAR norms produce such and such a rule. And so there is a grammar of sovereignty which keeps coming back and which is more or less imposed by the G2. Which means that when I when I said a few months ago that Europe must regain the thread of its sovereignty, otherwise it will have to choose between the United States and China, I didn’t think this could happen so quickly through health issues. I thought it would come through technology or the military. But that means these two phenomena do show you that this idea of a fluid world where everything is worth the same, produced anywhere, exchanged neutrally, is no longer true. First regarding the ecological and health shock, you may find some scarcity effect because everyone is asking for the same thing at the same time. And what we are going through during this epidemic, we will suffer the same sort of thing again if there is a sudden climate shock falling upon Europe tomorrow. Tomorrow, let’s speculate, tomorrow you have a massive heatwave hitting the whole of Europe, you’ll see a rush for air conditioners, and you’ll see that the ones produced in India, which they think are worthless will become the scarcest commodity of globalisation.
So we need to find that understanding again. And I believe that we need, in our globalisation, to first find sustainable limits for inequalities. An equal world is impossible. Because there are talent inequalities, they must be allowed to exist but then be corrected in order to be sustainable for the whole of society, but we do see today that the level of inequalities is putting societies under an unbearable level of pressure when it comes to democracy. I think it’s very dangerous if we threaten democracy with that level of inequality, and therefore we must thinking about that. And so we must cool globalisation or at least restructure it according to that. And the sovereignty phenomenon I was mentioning earlier, must bring us to relocate the terms of our sovereignty on a national and regional basis. So look, what we must do is to say regarding military, health, technological, industrial, ecological, climate and other matters, what must we relocate, either in our own country or in our region in order to co-operate with others without being totally dependent on them. Because when we are entirely dependent we no longer have terms which enable us to be politically independent.
And what I’m describing is entirely consistent with the third major change weighing on globalisation. I spoke of inequalities, I spoke of the return of sovereignty and of the grammar of sovereignty among two major global powers and several others. There are some regional powers which also embody this grammar. The third major phenomenon is the matter of climate. And climate change, whether it’s about CO2 emissions or biodiversity, forces us to reconsider that. And so you can see how the answer to inequalities just like the answer to sovereignty is coherent with the climate debate. It also implies co-operation of interdependence by choice, but also agreeing by choice re-fragmenting things in a non-conflictual way, to reduce emissions, and to rethink logistics, in order to avoid importing a component from across the globe, because we will produce it on our territory to reduce its carbon footprint. And to rethink production according to a just balance of CO2 emissions and of biodiversity and so of the safekeeping of our ecosystems. In my opinion that is what we are heading towards.
FT: Would you not expect that the virus and the crisis will negatively influence the debate on climate change?
EM: Listen, I don’t believe that, because I seriously think that these phenomena are linked. Which means that basically what humanity is going through with Covid-19 is fear for itself. It’s reconnecting with human values, and it fears for itself. And it’s saying that we are collectively discovering that no one will hesitate in making very brutal and deep changes when it’s comes to saving human lives. And it’s the same for climate risks. I say this with a lot of faith, for many developed countries, it’s the same. You know, great pandemics with acute respiratory distress for adults like the one we are currently going through, seemed very far away. Because they stopped in Asia. Climate risk seems very far away because it’s mainly affecting Africa and Oceania. When is strikes you, you suddenly wake up. I have kept saying to developed countries, don’t wait for the wake-up call when it comes to climate, to then go through what we are currently faced with for health. We are experiencing our own vulnerability. So we must move faster, myself included.
I am pushing this subject but I believe that we must change our models a lot more profoundly in order to have what I called this resiliency, which means the ability to say how we can prevent a risk of serious heatwave, a deterioration of our biodiversity which will affect our lives. And so I believe that is what we are going through, and for me that would be the anthropological change we have to deal with. Which means, when human lives are at stake, what we thought was impossible becomes possible. And that is what we must achieve in our global national, regional and international organisation. And so I believe that on the contrary, the climate agenda must come back to the foreground, because it goes hand in hand with the health agenda.
For me there is the education, health and climate agendas — and I put education in there because education is what allows you to stick to the strategy — you won’t succeed in a military or climate strategy if people don’t accept it. And you won’t succeed in doing so if you continue to promote this idea of a free man without educating him. And so for me those are really the three main key issues, I deeply believe in the emergence of a multilateralism based on these three key issues: education, health and climate. They are the three main values and will result in peace, and if there is no education, health or climate, there is no peace.
FT: Isn’t there a risk, especially with the influence of oil companies, that we must be forced to set that aside when faced with the emergency of relaunching the economy? Some people are already saying we must ease up on environmental regulations because it’s too difficult.
EM: You’ll realise that we are living collectively, or at least I will give all my efforts to do so in return for good regulations. Let’s be honest, the oil crisis started before Covid, because of geopolitical issues, Russia, Asia, Saudi Arabia, faced with the American production costs. So don’t blame the petrol crisis on Covid. It started before, Covid worsened it, because it generated a global drop in demand, but I believe a fatal flaw would be to come out of this crisis looking for a “new normal” if you know what I mean. That would seem amazing, but no. We must reinvent ourselves, and I do feel this deep down. Our nations need to reinvent something and to believe in it, and we must give them that opportunity. Otherwise, they will choose those who have condemned [them to] the old normal which has led them to this crisis.
So we are faced with a very profound anthropological, political and geopolitical opportunity, we must seize it and that is what will allow us to address this climate subject you were mentioning earlier, and I will tell you in a simpler way why I don’t believe in that. Because as I was saying, the two are linked, but deep down, I’ll speak very frankly, I believe we are all feeling that. What do we fear when we catch Covid? We are scared of chocking to death. People who caught Covid will tell you: “I don’t feel well, I’m losing my ability to taste,” and the first day, even when it’s not serious, they fear only one thing, and that is a sort of unspeakable truth which can create panic, which even persuades people to stay indoors. They are obviously scared of death. We are rediscovering this fear of death which had more or less disappeared from our societies, because we believed that, just like Prometheus, we were freed from everything. But now we are scared of choking and I think this phobia, no one will speak of it in these terms, but it’s still there because that’s what’s behind it.
The fear of choking is the fear of having difficulty breathing. We will exit this crisis, and people will no longer agree to breathing polluted air. You’ll see something that was already rising in our societies, people will come out and say “I don’t want to breathe this air. I don’t agree to make such choices which will result in me breathing that type of air, where my little baby might catch bronchitis because of it, because choosing that type of society makes it so. And you have accepted the idea of shutting down everything to stop Covid, but now you are ready to let me go on breathing bad air.” I do truly believe that, and people have good common sense. What I’m saying is true. Polluted air is insufferable and we all of us debated about it and said “It’s very hard. We can’t stop all of the trucks, all of the decision makers in the world when faced with this dilemma say the same thing.” And now we will have to say, “Sorry, but people are scared of choking and nothing can justify accepting that.” And I say this in very simple terms in order to show you that these two fears are linked. And at the end of the day we are women and men living in society, asking the government to implement rules and so we will have to find those rules so that people can enjoy better air quality. That’s ecology. And in the same way, people will want to have a life balance in which, and I do believe it . . . – ose who think the ecological agenda was a question of the past are wrong. It will come back to the forefront along with health and education.
FT: Everyone is thinking of the “Exit Strategy” and governments are under pressure to outline a way out of the crisis. Is there, in your mind, a maximum number of months after which the lockdown becomes intolerable for the economy?
EM: I don’t know, and I must be able to answer “I don’t know”. Today, we have been hit by the first wave. We have all decided, half of humanity is under lockdown, we have decided that what we thought was impossible could very well become possible. And so now we are trying to figure out how we can come out of lockdown and what strategy to adopt when coming out of this first phase. I have set this deadline of the 11th of May as a first step [for France]. And what I believe we must do is organise things so that the pressure we are putting on the whole of society may become a different way of organising society with tests, quarantine for contaminated people, treatment as soon as we can and a society coming back to life with precautions such as the basic reflexes for combating the virus. And that will be true as long as we have no treatments, no vaccines, and no herd immunity. And that is the phase in which we are about to enter in the coming weeks.
But there is an uncertainty. Will there be a second wave? I am unable to answer today, no one can. Asian societies are faced with it because of reimportation. What I do know is that during that second phase towards which we are more or less headed, there will be a fragmentation of globalisation because we will all be scared of reimporting from other regions and so regions will co-ordinate on a healthcare level but will close themselves to other regions in order to avoid phasing out and reimportation. Then, you’ll have several options depending on what the virus will become. Either we find a vaccine in the upcoming months, and that is a very strong initiative I want to push forwards with some others: we must invest massively [inaudible] and the WHO so as to be able to lead from the front. What we want do which is profoundly new, is to say “We must lead several clinical trials for the vaccine and we must prepare manufacturing of all these vaccines, and therefore accept to burn some money including on things which might eventually fail.” To go faster. So that as soon as we have a potential solution, we start manufacturing to go quicker. Distributing vaccines, and at the same time managing to send it around the rest of the world, including the least developed countries. That’s the strategy we’re going for.
FT: Do you see sufficient co-operation?
EM: That’s what I’m trying to push in the G20, Norway has a great leadership in [inaudible], France, at the beginning of the century, had a great leadership with GAVI, with Brazil. The WHO obviously has a key part. Several foundations like the Gates played an important role. I have spoken of the Gates Foundation to Bill Gates two days ago. I spoke of it at G20, and I want to mention it at then G7. What I want us all to achieve, is to be able to innovate and put all these valuable pipelines together saying “Let’s get into project mode, CEPI, GAVI, WHO and create a little team, backed up by the G7, we’ll have all of the money and then let’s go.” And so that’s the exit strategy. And to conclude, there is this second phase towards which we’re headed where we say “we’re going to split up” and then there are several options. One, we find a vaccine with the method I’ve just mentioned and we manage it successfully. The second option is we find a treatment. And that means we are able to isolate and treat until everything comes back to normal. There is a third option, because we must always keep that same humility regarding what we don’t know, and that’s about how this virus works. No one knows for sure. Does Covid-19 go away as summer comes along? I can’t say that for sure, some say that it does, others that it doesn’t, but in truth it’s impossible to say. Why does flu disappear each spring? It comes back the following year so I’m unable to be clear about the truth and nor can others. So maybe it will leave us alone for several months and then come back so we will have to organise a strategy. We are currently in the phase 1 to phase 2 strategy. What’s certain is that we are all dealing with the search for a cure, and we’re going to do everything we can to improve the vaccine strategy and that is a global initiative which I wish to promote in G7 to invest massively and increase the pressure.
FT: Did you ever think you would be one day faced with such a crisis? What does it change for you personally and in the way you govern as president?
EM: Listen, first I didn’t imagine anything because I’ve always relied on destiny. And deep down that’s the simplest thing to do. We must always be available for destiny. I am in a state of availability to act, I have deeply held convictions on what my country is, on what Europe is, what is in my opinion the best way for the world to develop, a world made of freedom, co-operation and mutual help between nations, in the deep sense of the word.
And then, I believe our generation must know that Beast of events is there and that it’s coming, whether it’s terrorism, great pandemics, or other shocks, and we must fight it when it comes and brings with it unexpected and implacable factors, and we must do so by staying constant in our values and without giving in, while remaining available for the event and the new factors it might bring.
I will never give up in front of anything, or whatever enemy we might face, on freedom, democratic principles, and what makes our nation what it is. But at the same time I believe that those moments enable us to invent, perhaps invent something new for our humanity, as we have been discussing — that’s to say a new balance in interdependence between men and women in order to consider what it means to be in the world and which is built around education, health and environment. And so that’s where I find myself. Ready to fight and promote what I believe in while remaining available to try and comprehend what seemed unthinkable. And we must keep this sense of availability, intellectual and personal, and ready to accept an event as it comes without immediately placing it in a category, for I believe our nations are experiencing it deeply and we are currently living this way, so we must accept that it will change us. Without being able to say everything about what it has changed for us. And that is also why we must have both humility and determination.
FT: Given the massive debts and deficits that countries will emerge with, deficits not seen since the second world war, what shape will economies take in the future? Given the chance of large nationalisations and the role of governments, will we see a return to more Socialist economies?
EM: I will not go into those categories which are those of the 20h century. Why, when the unthinkable is happening, would you wish to come back to already existing categories, which date back a century and which have shown their limits? We must invent new categories. And while socialism in one country may not have worked, the unthinkable in all countries forces us to reinvent ourselves. If we were alone is trying to do the impossible, we would struggle. But we’re all embarking on the unthinkable. And so we all are faced with this profound obligation to invent something new, because that’s all we can do.
