Reliance on the rule of law remains the key strength of the euro as the currency faces up to the impact of the "fragmentation" of the global economy that is affecting investors' confidence, European Central Bank President Christine Lagarde said on Wednesday.
Lagarde was speaking in an exclusive interview with the China Global Television Network (CGTN) on the sidelines of the ongoing 2026 annual meeting of the World Economic Forum (WEF) in the Swiss Alpine town of Davos, where world leaders and experts have gathered to discuss the pressing issues facing the global economy.
As the world economy has faced a series of shocks from the impact of tariffs imposed by the U.S. and a number of geopolitical flashpoints that have further strained global markets, Lagarde expressed her concerns about the risks posed from what she described as the increasing "fragmentation" of the international system which is drifting away from globalization.
"I think I would more likely use the word 'fragmentation' of the world economy as we have seen it for many decades, with international institutions that support and advocate for multilateralism and international cooperation. And we are now seeing a fragmentation of that order, fragmentation of the relationships. Challenges raised here and there, which obviously have an impact on the confidence of investors and the appetite for financing or holding," said the ECB chief.
Despite this difficult backdrop, Lagarde noted that the euro remains a strong currency, currently accounting for around 20 percent of global foreign exchange reserves, ranking it behind only the U.S. dollar.
Given how the euro serves as the official currency in more than 20 European Union member states, Lagarde highlighted how compliance with the rule of law is what contributes significantly to its strength, emphasizing that adherence to legal frameworks fosters a stable and predictable economic environment.
"That probably is strengthening the confidence in the euro, which is obviously based on the rule of law, on the compliance with our treaties, on the independence of the central bank, the European Central Bank, which is guaranteed in the treaty. That's what I mean: an independent central bank that does its job to control inflation and that is not being guided or told by the fiscal authorities what to do, but simply guided by its mandate. Those are clear strengths of Europe and of the euro," she said.
She stressed the role of the ECB and its commitment to maintaining monetary stability, ensuring that the euro remains a robust and trusted currency in the global market.
"A lot relies on a central bank to deliver on price stability, and we will do that and continue to do that. A lot depends, also, on the fundamentals of the economy. A lot depends on the international status of those economies, including international trade agreements, as I said, reliance on the rule of law, its capacity to defend itself, which is something that the Europeans are working on and will continue to work on. So, a currency is not just an isolated element; it relies on pillars that need to be addressed altogether," said Lagarde.
Under the theme "A Spirit of Dialogue," the five-day 2026 WEF is running in Davos through Friday. About 3,000 leaders and experts from around the world are gathering to discuss five pressing global challenges, including enhancing cooperation, unlocking new sources of growth and deploying innovation at scale and responsibly.
ECB president expresses confidence in euro amid "fragmentation" of global economy
ECB president expresses confidence in euro amid "fragmentation" of global economy
The Gordie Howe International Bridge has transformed from a symbol of U.S.-Canada friendship into a stark reminder of fractured trust due to the escalating tariff disputes between the two countries.
Connecting Detroit, Michigan with Windsor, Ontario, the gateway handles nearly one-third of total trade between the two countries, serving as a critical artery for the auto sector and manufacturing networks on both sides of the border.
The bridge, named after Canadian hockey legend Gordie Howe, provides a vital highway-to-highway connection between Ontario's Highway 401 and Michigan's Interstate 75, and was expected to improve cross-border trade, travel and supply chain efficiency between the two countries. According to the Canada Border Services Agency, it brought the total number of Canadian land ports of entry to 118.
Construction began in 2018, with Canada fully financing the project at 6.4 billion Canadian dollars (about 4.6 billion U.S. dollars). Michigan is nominally entitled to half the ownership, while not contributing to construction costs, an arrangement once touted as a model of cross-border cooperation.
But as the project neared completion, the U.S. side complained the bridge did not use enough American materials and argued that Canada was taking advantage of the United States. The opening of the bridge was repeatedly tied to tariff talks and other trade issues, with the U.S. pressing for a share of future revenues, resulting in the delay of the launch and turning an infrastructure milestone into a bargaining chip.
An agreement was only reached after Canada agreed to divert a portion of the bridge's toll profits into U.S. local regional development funds for the next 15 years.
"From logistic point of view, Canadians had made the commitment all along to make the logistics with a flow of good between the two countries to be as fast, as seamless as possible. That's why Canada built the Gordie Howe Bridge and paid for it, even though Donald Trump has delayed the opening of the bridge," said Emile Nabbout, president of Unifor Local 195, a worker's union in Windsor-Essex.
Local officials on the Canadian side said a joint U.S.-Canada launch ceremony had been planned for July, but Canada ultimately canceled its invitation to the United States amid tariff threats. Celebrations were held only in Canada.
Community leaders in Windsor have expressed frustration as ties sour.
"A number of lies have been said by the U.S. president about our country, which created a huge hurdle in opening the Gordie Howe International Bridge, which created a situation where we weren't able to do a binational ribbon cutting because there was no cooperation between the White House and the Canadian government. And that's really unfortunate," said Stephen Hargreaves, coordinator at the Sandwich Town Business Improvement Association in Windsor.
The Gordie Howe Bridge, meant to bridge divides and enhance communication, has instead bred resentment among local residents. Many Canadian tourists have cancelled plans to cross the border for travel and leisure.
"We've seen people who have come from Toronto, from London, Ontario, from other parts of Canada and come down to Sandwich Town, and they've cycled across the Gordie Howe Bridge behind me and they've cycled across it, not gone through customs, turned around and come back and gone right back through Canadian customs," Hargreaves said.
To a great number of Canadians, the recent maneuvers by the U.S., from reopening signed bilateral infrastructure agreements for renegotiation to imposing steep tariffs, represent an erosion of the trust and contractual spirit that once defined this traditional partnership.
"The scars are not going to heal immediately. We are, as Canadians, especially those who live like we do so close to the American shoreline -- these scars don't go away immediately," said Hargreaves.
Trade tensions between the United States and Canada began to escalate on Sept 8 as U.S. President Donald Trump announced new import bans and tariff adjustments on Canadian products.
Trump signed five proclamations under Section 338 of the Tariff Act of 1930, banning imports of certain Canadian alcoholic beverages, dairy and other products previously subject to 50-percent tariffs. The import bans will take effect on Sept 29.
The measures also revise the scope of tariffs announced on July 20, removing products including rock salt and cement while adding others such as all-terrain vehicles and additional dairy products. The changes took effect on Sept 15.
Canada-funded bridge becomes U.S. bargaining chip in trade dispute
