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The Coronavirus will force us towards a more national and protectionist economy

2020-04-16 14:02:19

Coronavirus leads nations to consider a more national and protectionist economy

Coronavirus outbreak worries nations and their economies.

Due to the growing coronavirus pandemic, many economists are constantly asking what should be done to avoid falling into an irremediable crisis, and almost all of them are targeting the same thing: creating a more national and protectionist economy.

This issue has taken hold in recent days due to the statements made in Germany about protecting its assets, that is, its main national companies from "foreign" acquisitions.

In the words of Ecomomy Minister Peter Altmaier: "Let's avoid a sale of Germany's economic and industrial props. There can be no taboo." "Participations" and "acquisitions" will be enabled by the state. "

Towards a more national and protectionist economy

Germany has its reasons for being the first to say so, as in recent weeks some of the major German companies have been deployed because of the epidemic. The top thirty companies, listed on DAX 30 of the Frankfurt Stock Exchange, have lost a third of their value in the past month. Industrial emporiums such as Daimler, Continental, Volkswagen or Siemens at a discounted price for foreign investors.

Due to this, market prices fall and is shown as an opportunity for entrepreneurs to acquire new companies under their own signature. For this reason, it seeks to create a more national and protectionist economy, since fear is shared throughout Europe. "Low prices in the markets represent an opportunity for mergers and restructuring," Guntram Wolff, director of the Bruegel group of experts, explains in DW, "and the Commission and the EU member states are the problems that, in such a situation , the strategic values ​​necessary protection ".

With the Coronavirus attacking, one of the greatest examples of exploitation is seen in the health sector, the US proposed the acquisition of a German company, CureVac, focused on the development of a vaccine. The reaction was immediate. "German researchers have taken a leading role in the development of medicines and vaccines against Coronavirus," explains Foreign Minister Heiko Mass. "We cannot allow others to take full advantage of the result of their work."

Altmaier recently spoke again: "I tell all those people in investment funds who are yearning to acquire German firms at a bargain price: don't get confused, we are determined to support our companies." Words backed by $ 100 billion of public investment.

For this reason, the possibility of creating a more national and protectionist economy is sought: to amplify the influence of the states on the private sector, encourage a less open nature of the economy.

 The approach towards a more national and protectionist economy has been talked about since last year when Germany itself presented a similar program, and has been inclined to safeguard the German character of key companies at least since 2016. The Coronavirus was reinforcing a fold nationalist in economic matters.

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