European Central Bank President Christine Lagarde

CHRISTIANE AMANPOUR: Look, the E.U. governments are racking up massive debts to ward off the worst of this pandemic, and yet you, as the Central Bank, are urging banks to keep lending. Tell me what the procedure is.

CHRISTINE LAGARDE, PRESIDENT, EUROPEAN CENTRAL BANK: Well, what we want to do is make sure that households, corporates, governments have access to financing, so that they can sustain this period of incredible hardship from the health and economic point of view. If you want, it’s like providing a bridge across very troubled water, the pandemic. And that bridge is financing that has to be available at very favorable conditions. So, this is really our purpose with this half-a-trillion more asset purchase that we are preparing to do for the next nine months, but with one objective, making sure that financing conditions are favorable, because, to give you an idea, we all had hoped that, once the first wave was over, vaccinations would be on their way, would be rolled out, and we would have herd immunity in short order. This is not happening because of the second wave, because of the additional containment measures, because of the logistics associated with vaccination. We know now that it’s going to take pretty much the whole of ’21. And for the economy to then pick up, it’s going to be a matter of a few additional months. So, we’re providing potential financing to make sure that financing conditions are favorable and supportive to get across those troubled water and root the recovery in solid ground. That’s what it is.

AMANPOUR: And that’s over into 2022, you’re saying. And, at the same time, the E.U. is trying to get to grips with its own budget and its own pandemic relief. Do you think, whatever they pass, that it will be enough to meet what you’re saying, which is an unexpectedly harsh second wave? And I have even heard people worry about a third wave.

LAGARDE: It will be one side of the deal. The — what happens at the regional level in Brussels, if you will, the budget and the recovery and resilience fund is one side of the deal. The other side of the deal is what member states, you know, the likes of France, Germany, Spain and all of them, are also putting on the table in terms of fiscal support. And the two combined are really intended to support people, make sure that income is preserved, that training is provided, that the economy is transformed, because this pandemic has not only hurt, but it has also accelerated transformation.