Coronavirus: DSK's advice to overcome the economic crisis

It is essential that the International Monetary Fund (IMF) use its special drawing rights (SDR), a kind of currency created by the IMF to support states, in order to mitigate the effects of the Covid-19 crisis, estimates its former Secretary General Dominique Strauss-Khan (DSK). " Debt relief for low-income countries and massive issue of SDRs are today a necessary step to help avoid an economic disaster, " said the Frenchman in a long column to appear in the next issue of the French journal Politique Internationale.

Believing that "we are witnessing an organized coma and a sustained, but probably lasting, disintegration of supply chains " caused by the epidemic and containment measures, he stresses that the action of the major central banks (in addition that of governments) to avoid a drop in demand " will only indirectly affect emerging economies " for which he is particularly worried.

“ On the other hand, it is possible to use a mechanism that has already proven to be effective in the global financial crisis: the IMF Special Drawing Rights. Nothing prevents reactivating them; nothing, except the American allergy to anything that resembles multilateral action, an allergy that the lukewarmness of Europeans does not help to counterbalance, "judges the former secretary general from 2007 to 2011, converted into council.

What will happen when, pushed by the collapse of their national economies, there will be millions (of migrants) trying to force the passage

In countries dependent on their exports of raw materials or the tourist windfall, the economic collapse “ risks plunging millions of people from the 'emerging middle class' back into extreme poverty. However, more poverty also means more deaths ”. DSK also anticipates a migratory surge towards Europe. “ Before the current crisis, Europe was already having the greatest difficulty managing the influx of a few hundred thousand migrants crowding at its doors. What will happen when millions of them, driven by the collapse of their national economies, try to force their way ? ”

In a long paper largely scanning the risks and the opportunities (economic and political) caused by the Covid crisis, the former figure of the social democratic left underlines how the epidemic crisis throws a harsh light on the faults of the globalized economy , “ The relativity of our sovereignty” , the risks for public and individual liberties and the dangers for “cacochymous parliamentary democracy ”.

Economist, former politician who was presumed to be a candidate for the left for the presidency of the Republic in 2102, he was forced to resign from his IMF post after a resounding sex scandal and several accusations which put an end to his political ambitions.