We have generally taken a more sanguine view than most about the long-term damage caused by the pandemic. Indeed, unlike in the global financial crisis, we expect most economies to eventually return to their pre-crisis paths of output... But the longer the recovery takes, the greater the risk of economic scarring as investment is permanently lost and skills start to atrophy. If the pandemic leaves a legacy of permanently lower output anywhere, there’s a good chance it will be in the euro-zone.