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Lagarde Warns: AI Threatens Europe’s Social Model Without Urgent Action

by THEFUTURE.TEAM

April 2, 2025

Artificial intelligence could disrupt Europe’s carefully balanced social model unless countries step up efforts to develop the necessary skills, European Central Bank (ECB) President Christine Lagarde cautioned at an ECB conference in Frankfurt, Bloomberg reports.

Key Takeaways

Lagarde acknowledged AI’s potential to boost productivity but underscored its risks, particularly growing inequality in the labor market.

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The demand for highly skilled professionals who can leverage AI will surge, while those struggling to adapt may be left behind.
She pointed to a 2025 analysis estimating that 23% to 29% of jobs in Europe are highly exposed to automation.
Europe’s strong labor protections could complicate large-scale workforce shifts, making the transition more disruptive if not properly managed.

The Bigger Picture

Lagarde’s remarks reflect broader concerns among central banks as they grapple with AI’s economic impact amid long-term challenges like demographic shifts and climate change.

She also highlighted AI’s role in Europe’s push for technological sovereignty, warning that reliance on foreign innovations may no longer be sustainable.

“We can no longer assume seamless access to cutting-edge technologies developed abroad. This new reality strengthens the case for Europe to take a leadership role in AI,” Lagarde said.

What’s Next?

The ECB is closely monitoring how AI could reshape inflation, monetary policy, and financial stability. The Bank for International Settlements has also urged central banks to better understand AI’s economic implications and leverage it internally.

Lagarde’s conclusion was clear:
“We must remove all barriers that prevent us from leading this revolution. But we must also prepare for its human and environmental impact—starting now.”

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Price Shifts: Temu And Shein React To Upcoming Tariffs

by News Editor

April 27, 2025

The online shopping world experienced a jolt as Temu and Shein, popular e-commerce platforms, recently adjusted their prices due to impending tariff changes. These platforms, known for offering budget-friendly options, have echoed with changes that might surprise many shoppers.

What Sparked the Price Hike?

Effective next week, a significant tariff will impact goods imported from China. This tariff follows the expiration of the “de minimis” exemption on May 2. This exemption previously allowed American shoppers to skip tariffs on items valued under $800. The new tariff demands a 120% fee or a flat $100 per postal item, increasing to $200 come June 1.

For instance, Temu’s two patio chairs jumped from $61.72 to $70.17 overnight, while a bathing suit on Shein saw a 91% surge in price. Yet, the price landscape isn’t consistently upward; a smart ring on Temu dropped by $3.

Implications for Consumers

Due to economic shifts and evolving trade rules, both Shein and Temu emphasized their efforts to maintain quality and affordability despite costlier operational expenses. They advised consumers to shop before April 25 to dodge the upcoming hikes, though it’s uncertain if this timing affects the 120% tariff applicability.

Impact on Lower-Income Households

The discontinuation of the “de minimis” exemption is poised to hit lower-income families hardest. Reports indicate these households spend a higher income proportion on apparel, and this change could burden them further.

Further economic insights highlight how industries adjust to challenges, such as in the face of AI-driven changes, potentially offsetting emissions concerns with economic gains.

For buyers and businesses alike, the shifting sands of trade laws call for adaptability and forethought.