„The economy is getting weaker. We’ve seen a slow down in growth in all the major economies, both advanced markets and emerging economies. So in that respect we are becoming more fragile.” said Adolfo Laurenti, the principal economist of Visa, in a NOCASH interview at international conference Banking 4.0.
„There are some of the risks on the horizon: Brexit, the trade wars, what happening in credit markets, oil – it is always a wild card. IF something goes wrong with any of these, then the probability of a recession go up.”, Laurenti believes.
Do you think that the trade dispute will be the most dangerous factor, with the greater damaging impact on the global economy?
„Could be. It will be damaging in the short period so it might be a trigger for recession, but it also damaging in the long therm because we all benefits from open trade and we are really going into the wrong direction on that front.”
There will be differences in the geographical regions in terms of recession impact?
„There will be a difference but the reality we all benefit during the time of growing globalization. Clearly Asia has been growing a lot. But even as a consumers in advance economies in Europe and the United States we collected a lot of benefits from that process. And seen now new barriers being build to prevent or to delay trade it’s very dangerous in terms of how the economy will look like in ten, twenty, thirty years.”
Follow the full interview below if you would like to find-out the Visa representative’s opinion on the impact of 5G technology on payments, Visa withdrawal from the Libra Facebook project and growing trends regarding the introduction of the central bank’s digital currency.
„Though Libra has met with fierce resistance from central banks and supervisory authorities and might never see the light of day, in many other cases tech firms (both start-ups and established big players) have successfully captured bits and pieces of universal banks’ traditional value chain. This trend may only intensify in the coming years. In this environment, European banks remain squeezed.”