Speech by Christine Lagarde, President of the ECB, at the official dinner of Banka Slovenije in Ljubljana, Slovenia
Ljubljana, only 16 October 2024
It’s a pleasure to be here this evening.
Not far from here, nestled in the National and University Library, are copies of the ABC and the Catechism. These two texts, written by the religious reformer Primož Trubar in 1550, were the first books ever printed in Slovene.[1]
At a time when German was the language of the ruling classes, Trubar’s pioneering act was fundamental in helping to establish the national identity of Slovenes.[2]
Today, his portrait adorns the €1 coin in Slovenia, framed by the famous words found in the Catechism “Stati inu Obstati” – “to stand and resist”.[3]
It is telling that both books – one an introduction to the Slovenian language, the other guidelines for religious observance – were designed to teach, because there is much to learn. Europe can learn from Slovenia in the uncertain world we face.
The world order we knew is fading. Open trade is replaced by fragmented trade, multilateral rules by state-sponsored competition, and stable geopolitics by conflict.
Europe had invested considerably in the old order, so this transition is a challenge for us. As the most open of the major economies, we are more exposed than others.
So, in this new landscape, we too must learn to “stand and resist”. And we can do this by learning two valuable lessons from Ljubljana.
Opportunity in times of uncertainty
The first lesson is that uncertainty can create opportunity.
While many Europeans worry about the future, Slovenes are no strangers to uncertainty.
In just one generation, Slovenia successfully made the extremely difficult transition from a planned economy to a market economy. Policymakers defied all odds by implementing drastic structural reforms to first join the EU and, later, the Eurozone.
Today, Slovenia is a success. It is a developed, stable, high-income economy, with the highest GDP per capita at purchasing power parity of the Central and Eastern European (CEE) countries.
The nation’s success owes much to the creativity and vigor of its people and their innate ability to seize economic turning points and transform them into opportunities.
For example, when Slovenia joined the EU, it was exposed to greater competition from other member states of the economic bloc.
But Slovenia quickly capitalized on its skilled workforce to develop a new economic model based on deep integration into the single market. Today, every car produced in Europe has at least one component made in Slovenia.[4]
For Europe, today’s changes in the global economy represent a similar turning point. But if we approach it with the right spirit, I believe it can be an opportunity for renewal.
A less favorable global economy may push us to supplement our domestic market. Fierce foreign competition can encourage us to develop new technologies. More volatile geopolitics can push us to become more energy secure and more self-sufficient in our supply chains.
For Slovenia, the transformation of the automotive supply chain will pose a particular challenge. But the economy is already adapting. For example, in July this year, Slovenia secured a major investment in the domestic production of electric vehicles.[5]
For many Slovenians, stepping into an unpredictable future may seem like second nature.
One of your most famous paintings, “The Sower,” is on display here at the National Gallery. Depicting a farm worker at dawn hard at work sowing seeds in a field, the painting represents the resolute determination of Slovenes in the face of uncertainty.
The rest of us in Europe will need to learn from this example in the uncertain times ahead. If we do this, we can also turn uncertainty into opportunity.
The importance of sharing the benefits of change
The second lesson from the Slovenian experience is that the benefits of change can – and must – be shared more widely.
The path to renewal for Europe is inevitably linked to new technologies, notably digitalization. But new technologies can sometimes lead to unequal labor market outcomes.
Slovenia has experienced remarkable technological changes over the past 20 years. Today, the country’s level of digital development is 7% higher than the CEE average and it can compete with some of the most digitally developed EU countries in some areas.[6]
Yet Slovenia’s Gini coefficient – a measure of income inequality – is the second lowest in the OECD.[7] The country also enjoys high levels of gender equality. Women’s participation in the labor market is above the EU average and almost equal to that of men.[8]
Many Europeans are concerned about future challenges, such as the effects of artificial intelligence on social inclusion. But we should be inspired by the example of Slovenia.
With the right approach, we can move forward and become more technologically advanced while ensuring that everyone can benefit from the gains.
And when everyone benefits, Europe benefits too. More than three-quarters of Slovenian citizens feel attached to Europe, and almost two-thirds identify as both Slovenian and European – levels well above their respective EU averages.[9]
Conclusion
Let me conclude.
In today’s uncertain world, Europe must learn to “stand and resist”. And it can achieve this by taking the example of Slovenia to overcome the challenges it faces.
First, we must work hard to sow the seeds of success. And then, as folk singer Vlado Kreslin sings, “it’s true” – “anything is possible.”
Merci.
Lien source
Originally published in The European Times.
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