ECB Governing Council Member: Europe's Adherence to the Old Economic Model is "Naive" The World is No Longer Rule-Based

Golden Finance reports that on May 4th, European Central Bank Governing Council member Wünscher stated that Europe naively believes that a free-market model can survive the global shift driven by the United States. He pointed out that EU policymakers are still pursuing goals such as open markets and limited government aid, but these objectives no longer reflect the geopolitical realities shaped by Trump’s “America First” policy. “Trade openness and strict state aid rules are feasible in a rules-based world,” Wünscher said. “But that world has disappeared, and if you cling too tightly to a world that no longer exists, then you are being too naive.” The core of his argument is that Europe has failed to internalize the fact that the global economy has moved away from a fair competitive environment. He said that U.S. protectionist policies have reshaped this landscape. “The world has changed, and we cannot keep doing the same things and giving the same answers, as these issues have already failed to some extent in the past.” (Jin10)