Escrivá: Trust anchors finance in fragmented, tech-driven world
José Luis Escrivá, Governor of the Bank of Spain, emphasized the critical role of trust in a global order reshaped by geoeconomic fragmentation and technological change. He spoke at the Spain LatAm Economic Forum on May 9, 2026.
Geoeconomics: Beyond tariffs, into finance
Governor Escrivá highlighted a global shift from multilateral cooperation towards economic and financial tools being used as instruments of pressure.
He noted that geoeconomic measures often have endogenous and dynamic responses, with longer-term effects potentially diverging from immediate objectives.
Tariffs, for instance, impact less through direct trade effects and more through financial channels, altering asset values, prompting capital movements, and affecting exchange rates and financial stability.
This dynamic places capital flows at the core of geoeconomic transmission.
Furthermore, the effectiveness of geoeconomic pressure relies on control over critical 'choke points' in finance, technology, platforms, and key inputs, rather than just tariffs.
Where control is high and substitutability low, interdependence transforms into vulnerability, making globalization a channel for coercion.
Trust: The central bank's public good
Escrivá underscored central banks' role in providing trust amidst geoeconomic fragmentation and technological change.
Credible monetary policy frameworks are vital for managing exchange-rate adjustments, containing inflation, and handling financing spillovers.
Central banks also guarantee new technologies, like private stablecoins, which lack inherent stability.
Latin America has shown increased resilience over two decades due to stronger monetary policy and flexible exchange rates.
Yet, challenges persist from supply shocks, modest growth, and structural constraints.
Future growth depends on technological advancement, diversification, and attracting long-term capital, requiring robust institutions and predictable rules.