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Francisco Pérez calls for unity among the political groups of the Valencian Parliament to overcome the crisis

The Ivie Research Director highlighted the key points mentioned in the Ivie report to overcoming the COVID-19 crisis in the Valencian Community regarding the diagnosis of the situation and the short, medium and long term challenges faced by the public and private sectors

Ivie Research Director, Francisco Pérez, recently addressed members of all political groups represented in the Valencian Parliament (Corts Valencianes) in its Commission for the Social, Economic and Health Recovery of the Valencian Community. In his talk, he highlighted the key points for overcoming the COVID-19 crisis mentioned in the Ivie report, referring to the diagnosis of the situation and the short-, medium- and long-term challenges facing the public and private sectors. He also emphasized that the main lessons learned from the crisis must be taken into account when implementing strategies.

One of these lessons concerns the change in society’s perceptions of risk, particularly health risks. Further lessons learned from recent events are the recognition of the importance of knowledge as the basis for solving problems, and the role of the public sector in providing a mechanism of solidarity to protect both individuals and many businesses. The collective response of citizens to jointly achieve a common goal, in this case, stopping the spread of the pandemic, was also noted. Francisco Pérez identified other key elements on the path to recovery such as the capacity to reinvent oneself and look for new ways of doing business by adapting to new conditions, which the most dynamic firms and the most creative researchers have proven to be effective.

Furthermore, he warned that while the responses given to compensate for the loss of economic activity through fiscal policy measures involving large deficits are appropriate in the short term, they should not become permanent. He argued that, when economic growth improves, attention must turn to recovering public sector financial balances, which will be easier if structural measures are taken to strengthen the Valencian Community’s economic growth and ensure its resilience over time. To achieve this, pre-crisis weaknesses must be rectified: per capita income disparities, low productivity levels, a low knowledge-intensive productive fabric with multiple small units, and a poorly funded public sector with organizational weaknesses. To address these essential changes, all agents, both public and private, must collaborate under a broad social and political cooperation agreement. Likewise, European aids such as the Next Generation EU should be channeled through public-private collaboration agreements to develop quality projects that promote investment in digital modernization and improve the sustainability of the Valencian economy.