Belgians urged to work hard to avoid economic collapse due to Covid-19 crisis

Belgians urged to work hard to avoid economic collapse due to Covid-19 crisis
© Belga

The Governor of the National Bank of Belgium, Pierre Wunsch, would like Belgians to keep working as much as possible so as to deaden the impact of the health crisis linked to the novel Coronavirus.

“I know it’s a bit in contradiction with the ‘Stay at home’ message,” Wunsch said in an interview published on Saturday in De Morgen, “but we need to strike a balance between this public health crisis and our economy.”

He also warned against sharp increases in allowances and compensation, both for people forced to stay off the job and those going out to work. “We should not give people incentives to stay at home,” he said. “As for people who are still receiving their salaries, they do not need compensation.”

"We need to make sure that the regions, federal government and businesses do not all begin to share out allowances because in the final analysis, we shall observe overlapping between these allowances and gaps in our financial instruments,” added Wunsch, who is also co-chair of the Economic Risk Management Group, ERMG, in charge of assessing the effects of the Coronavirus on the economy and the financial sector.

"The support measures taken by the country’s various authorities are conditional, and rightly so,” Wunsch said. “If we begin to hand out money to everyone, including people with comfortable resources, or who are not affected by the crisis, we’re not on the right track.”

He feels the priority for the next few days is to find a good balance between the health crisis and maintaining economic activity as much as possible. “It is estimated that 30% to 40% of the Belgian economy is paralysed today,” he stressed. “If we do not pay attention, we run the risk of seeing our entire economy collapse because there are no longer any employees.”

Temporary unemployment is recommended in the short term, according to Mr. Wunsch, but there is need to go beyond that. “We need to be able to find, now, a midway solution for some people between working for a few days and stopping production on the other days. That’s one of the priorities for the next few weeks,” he explained. “Today there are already many companies that could work but face staff shortages."

The Brussels Times

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