Experts have been concerned about the immediate and long-term economic repercussions of the coronavirus pandemic since its onset last year. Sputnik spoke with Jochen Biedermann, managing director of the World Alliance of International Financial Centres (WAIFC), about the impact of the pandemic on the financial sector.
Sputnik: The world is experiencing a pandemic at the moment. It has affected most businesses, including the financial sector. What is the impact of COVID on financial sectors worldwide?
Jochen Biedermann: First of all, financial centres are in a sort of rescue mode. On the one hand, there is a fight to resolve issues as much as possible on the economic side. The government wants to give money to small businesses, but cannot do it directly, so there are banks, and development banks, or other institutions in between. Now we are considering the economic recovery: how to build up again, how to get business afloat again and minimise the impact with three core issues – small- and medium-sized enterprises, because for many economies they are the backbones. So the large corporates normally have other ways of financing themselves, or can be rescued by the government, like airlines, but as for small businesses, not many people care about them or at least they don’t have a lobby.
Secondly, start-ups in the financial industry have a lot of innovative power, e.g. virtual banking, digital banking, new payments. We cannot lose this power, these ideas. If they all go down the river, then we’ll have a big issue. So we need to help them and solve the issues as much as possible. And then the third issue is sustainable finance – we immediately need to focus on building it up sustainably.