00:00The potential for Europe has been questioned for quite some time and what
00:05we've been arguing for quite some time now is that things in Europe are
00:10improving, right? And in terms of the latest economic data, we look at city
00:15economic surprise indices. They continue to beat analyst economist forecasts. The
00:21same can be said for earnings revisions for a really broad set of sectors and
00:26actually city economic data indices, not surprise indices, are moving higher as
00:34well. You've seen the PMIs yesterday, you've seen the manufacturing activity in
00:39Europe over the summer. It's all going in the right direction and also we argue
00:44that actually policymakers are making good steps towards really protecting
00:50European economy going forward. So, what does that mean in terms of where you would
00:56take us next? Europe is obviously facing some significant challenges at the
01:00moment. We're focused this morning and we got up on the screen. Volkswagen cutting
01:03a number of jobs, trying to figure out what it's going to do next. How does it
01:07protect its business going forward? At the moment, it's cutting labour, but you do
01:11wonder whether or not ultimately this refocusing will work. What do you think
01:16Europe needs to do next to keep some of the momentum that it has?
01:22Absolutely. So, we've actually just published a very big report with the analyst cross department
01:27report on that subject, where we talk about European policy makers from the EU perspective
01:39starting to make meaningful steps in the direction of protecting industries that have been at risk.
01:45Because European economic model has really been caught between increasingly more protectionism
01:52from the US and quite assertive China, right? And certain industries like autos, chemicals is another
02:00very good example that have been under severe pressure from all these factors. So, potentially going
02:08forward, what we flag is the direction for Europe is to create this economic resilience. And part of
02:17creating it is also protecting through tariffs for some, like autos or preferential procurement processes,
02:26the industries in Europe. So, we have buy European, right? As I said, preferential procurement to
02:37contract European companies. And a very good example on how these tariffs could work is the steel market in
02:45Europe. So, we've had CBAM for quite some time. So, carbon taxing on steel imported from abroad. And more recently,
02:57over the summer, we've introduced tariffs as well, similar to what the US has done.
03:02And what it's done, of course, the actual price of steel has gone up. But European steel makers that don't
03:11pay the tariffs or don't pay the CBAM levy are actually getting the benefits of higher prices of steel, right?
03:22So, it's a good example how protectionism could actually work in European favour.
03:28So, it's a good example.
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