Tribune. For almost three decades, industrialized economies have struggled to emerge from a situation of “prolonged stagnation”. The signals are as follows: potential growth rates are low, so too are inflation rates, wage growth has been weak and remains below that of labor productivity.
In addition, productive investment has plunged and remains low, the financial markets are full of liquidity insufficiently directed to the productive economy. Finally, productivity gains are decreasing, including in the United States, which remains the most technologically advanced country.
A decoy
This phenomenon has long been masked by two factors.
The first has been China’s phenomenal growth over the past twenty-five years, which has supported global demand.
The second was the over-indebtedness of the private sector which artificially boosted consumption.
The economies of industrialized countries find themselves all the more trapped in lasting underemployment balances as the repeated crises (2008 financial crisis, European public debt crisis, health crises) have two harmful effects: they prolong the durations of recessions, and above all, weaken potential growth trajectories that productivity gains and innovations barely maintain.
To think that we will be able to get out of these situations by massive public debt, by flooding the financial markets with liquidity, or by forcing poor countries to trade thanks to regional agreements is an illusion.
A more sustainable solution is to trigger a large-scale global demand shock. This shock can only come from developing countries. All eyes are on Africa, Latin America and South-East Asia where development needs require the massive construction of infrastructure in all sectors of activity (health, transport, energy , digital). Most of the funding for these infrastructures will be provided by private capital.
A condition
The abundant liquidity available in the international financial markets of rich countries could be used for this. But on one condition that is far from being fulfilled: investing in the infrastructures of these countries should be perceived as safe investments (in the same way, for example, as the sovereign bonds of industrialized countries or as the securities issued by start-ups. up in cutting-edge sectors such as digital or biotechnology).
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