Page 5/6  Zurich, 23 March 2023 Thomas Jordan, Martin Schlegel and Andréa M. Maechler  News conference  Page 6/6
This is happening particularly in the advanced world, but even in the emerging world there has been a slowdown in potential growth. No one can say for sure if this is a permanent state of affairs. There is some debate among economists as to whether the productivity slowdown is a short term or long term phenomenon. But certainly the demographics will still be with us, societies will get older and labour force growth weaker, and economic growth is going to be significantly slower in the next 10 to 20 years than it has been in the past. Investment is unlikely to pick up very significantly in this context, and it does mean taken together with the savings trend, a lower long term real rate of interest in the global economy. 13. So putting the two together – trends in ageing and in economic growth, I think we have to live with the fact of low real interest rates for many years to come. 14. It will pose a challenge for retirement security, and especially for pension funds and insurance funds. As you know, it hits you on both your assets and your liabilities. It means a lower return on your assets. And it pushes up the value of liabilities because the discount rates has gone down. 15. It is not a temporary challenge but a long term challenge. As life expectancy goes up, liabilities will be pushed out further, and the gap in maturity between your liabilities and your assets is likely to grow.