Jacob Wallenberg has warned governments to weigh the economic threat of the coronavirus more heavily or to risk depression, social unrest and a potentially lost generation.
The Swedish industrialist, whose family investment vehicle holds majority stakes in companies ranging from telecommunications equipment maker Ericsson to SEB, told the Financial Times that policymakers must protect the vulnerable but not lose sight of the impact of containment measures on businesses, from neighborhood restaurants to multinationals. .
If the crisis lasts a long time, unemployment could reach 20 to 30% while the economies could contract by 20 to 30%, he warned.
“There will be no recovery. There will be social unrest. There will be violence. There will be socio-economic consequences: dramatic unemployment. The citizens will suffer dramatically: some will die, others will feel bad, ”he added.
His warning comes as country after country has closed schools and locked down large parts of society, leading to a drop in demand in the airline industries at theaters and to the cessation of production by many manufacturers such as the car manufacturers in Europe and the United States.
Donald Trump, the American president, said that the cure should not be worse than the problem and that the country should get back to work before Easter Sunday if possible.
Wallenberg said he wanted to open a debate on the long-term consequences of the crisis. “I am afraid of the consequences for society,” he said. “I want to put the point of view – what else can we do? For the moment, we are going on only one path… We have to weigh the risks that the drug could affect the patient drastically.
“What does tomorrow look like?” One of these days, there is a tomorrow. We also need to prepare. ”
His home country, Sweden, is a global outlier in its response to the coronavirus, keeping schools and borders open and making fewer restrictions than other European countries. There has also been an important debate about whether the economic costs of certain restrictions outweigh the health benefits.
Wallenberg said the Swedish debate had been essentially “business for life”, but he wanted to take a “life for life” perspective. Older people should be further protected, perhaps by being placed in compulsory quarantine.
But there should be a parallel discussion on how to return to a vibrant society with a rich cultural offer and lively restaurants as well as thinking about the next generation.
Wallenberg said his call for a debate on what happened after “the acute phase of the crisis” was supported by the European Round Table for Industry, 50 large industrialists representing companies with income 2 billion euros.
“The authorities are all working very hard to help society. They don’t look so much around the corner. They don’t take the longer term perspective. This is something very important for society and for the EU, “he added.