Fact Check: ECB chief did not hint at elimination of cash completely to fight climate change
video of Christine Lagarde, President of European Central Bank, is being shared claiming she wants to eliminate cash payments to reduce carbon footprint to fight climate change
Claim :
ECB chief Christine Lagarde advocates for abolition of cash to reduce carbon footprintFact :
Christine Lagarde’s statement on green monetary policy has been taken out of context
“If we do not account for the impact of climate change on our economy, we risk missing a crucial part in our work to keep prices stable,” Christine Lagarde, President of the European Central Bank, wrote in the ECB blog in November 2022.
Christine Lagarde, who has previously served as the managing director of the International Monetary Fund (IMF), has been very vocal about the impact of climate change on the economy.
Addressing a major economic conference in the Saudi capital Riyadh in October 2017, Lagarde had warned that the world would be in deep trouble if it failed to tackle climate change and inequality. She exhorted the world governments to take ‘critical decisions’ to avoid getting ‘toasted, roasted and grilled.’
As Lagarde advocates for incorporating climate risks into monetary policy frameworks and emphasizes the need for greater investment in "green" projects, a video of her is circulating on social media claiming the ECB chief has asserted that, “we must scrap cash to stop climate change.”
The claim in Spanish language reads, “La directora del Banco Central Europeo, Christine Lagarde DICE: El cambio climático" exige una revisión total de toda la economía... incluida la necesidad de reducir nuestra huella de carbono en todo lo que hacemos... para "reducir nuestra huella de carbono" hay que eliminar el dinero en efectivo.”
(When translated, it says, "Christine Lagarde: Climate change" demands a total overhaul of the entire economy... including the need to reduce our carbon footprint in everything we do... To "reduce our carbon footprint" we must eliminate cash. This is the biggest scam on the planet.)
The viral link is here and archive here.
Here’s the screenshot of the viral claim.
Fact Check:
During the investigation, the Telugupost Fact Check team found the claim to be misleading as Christian Lagarde’s words on euro currency have been taken out of context.
We ran a Google search with relevant keywords but found nothing which hinted Christine Lagarde suggests elimination of cash altogether. Similar searches on ECB’s YouTube channel also did not yield satisfactory results.
It is then we switched to Google Lens and the image recognition tool led us to the original video shared by Lagarde on her X account on January 30, 2024.
In the original video, Lagarde spoke about how, “A hotter climate and the degradation of natural capital are forcing change in our economy and financial system. We must understand and keep up with this change to continue to fulfil our price stability mandate. With the ECB‘s climate and nature plan, we are intensifying our efforts to help underpin stability and support the green transition of the economy and the financial system.”
She also highlighted three key priorities: 1. Green transition, 2. Physical impact of climate change and 3. Nature loss and degradation
As we continued our search, we came across an ECB press release, which talks about green finance.
“The ECB will launch its eighth Environmental Management Programme to support achieving its 2030 carbon reduction targets. Together with the entire Eurosystem, its work will include eco-design principles for the future euro banknote series and incorporate environmental footprint considerations into the design of a digital euro that is currently in the preparation phase,” the release said.
The statement of Christine Lagarge does not hint at doing away with the physical cash/bank notes but announced ECB’s climate plans which call for an action to reduce the carbon footprint and make the financial system more environmentally friendly.
The European Central Bank has plans to introduce its own digital currency, known as the digital euro, which will be more of an electronic equivalent of cash and certainly not a cryptocurrency. The bank officials have rejected the claims that the ‘digital euro’ is a step towards phasing out the cash payments completely.
From the video statement of Christine Lagarde and ECB’s press release evidence, we can deduce that the ECB chief did not advocate the elimination of cash completely but insisted on fighting climate change by phasing out climate-warming investments and making the financial system more environment-friendly. Hence, the claim is misleading.
