In opening remarks at the 40th Annual G30 International Banking Seminar in Washington DC, ECB President Christine Lagarde defended Europe's position amid debates on global economic imbalances. She argued that the euro area's current account surplus is declining and not a primary driver of worldwide deficits. Lagarde urged stronger transatlantic partnerships over coercive trade measures.
On October 18, 2025, Christine Lagarde, President of the European Central Bank, delivered opening remarks at the panel on the “Global Economic Outlook” during the 40th Annual G30 International Banking Seminar in Washington DC. She addressed growing concerns over global imbalances, noting that discussions have focused on China and the United States, with Europe now under scrutiny for allegedly pursuing an “unfair” trade policy toward the US.
Lagarde emphasized that the euro area and China together account for roughly half of the world’s current account surplus—about one-quarter each—while the US represents around three-quarters of the global deficit. However, she clarified Europe's limited role, stating, “Among the three major economies, Europe is not a key source of global imbalances—and its contribution has been steadily declining.”
Key data highlighted the nuances: The euro area runs a deficit of almost €150 billion with China, which has widened by around 10% this year. Trade with the US is broadly balanced, with a goods surplus offset by a services deficit, much of it driven by US multinationals. According to ECB estimates, around 30% of the bilateral goods surplus reflects exports by European affiliates of US firms, while those same firms account for roughly 90% of the services deficit, particularly in intellectual property products like pharmaceuticals.
Europe’s overall current account surplus has halved from almost 4% of GDP in 2018 to 2.1% in the first half of this year and is projected to remain around that level. In contrast, China’s surplus rose from 0.2% to 3.7% of GDP, and the US deficit widened from 2.1% to 6% over the same period. Lagarde attributed the surplus's decline to reversing forces post-pandemic, including intensified competition from China—marked by a 32% real euro appreciation against the yuan since 2022—and upcoming fiscal support, with the euro area’s average deficit expected at just over 3% of GDP for the next three years.
Demographics explain much of what remains, with an ageing population boosting savings. The IMF assessed the “excessive” gap at around 1% of GDP in 2024, which has since narrowed further.
In her conclusions, Lagarde warned that coercive tariffs against Europe would not resolve US imbalances and could backfire by increasing European precautionary savings and reducing US imports. She advocated pooling resources with allies, viewing Europe’s manufacturing strength as an asset for the US to reduce China dependencies. Finally, she called for Europe to boost domestic demand via the Single Market, noting that a 2% rise in intra-euro area trade could offset US export losses from tariffs.