The European crossroads: between deglobalization and the necessity to reinvent itself | National and worldwide economic system | EUROtoday

The world as we knew it’s altering at breakneck velocity and Europe is on the epicenter of this transformation. While we watch how the worldwide order is reconfigured earlier than our eyes, the previous continent faces a historic crossroads that assessments not solely its place on the world board, however its personal capability for adaptation and survival. In this turbulent context, the reflections of Comillas University professor Jorge Díaz Lanchas shed particularly revealing mild on the challenges and alternatives that outline our current.

The phenomenon that marks this new period has been named by consultants as “slowbalization”, a time period that captures the essence of the occasions we dwell in. In actuality, this idea doesn’t point out that we face a complete regression of globalization. Rather, this name to decelerate globalization means one thing nearer to a metamorphosis within the patterns and buildings of worldwide commerce.

This transformation is definitely characterised by a selective slowdown, the place it’s true that worldwide commerce in items loses velocity whereas the alternate of providers not solely maintains, however even intensifies. This distinction, removed from being a mere technicality, is key to understanding the strategic choices open to Europe, a continent the place it nonetheless appears to keep up sure comparative benefits within the exports of those actions.

Regarding the geopolitical panorama that emerges from this transformation, it’s marked by a rising strategic polarization endogenous to the advance of a multipolarity that isn’t resistant to the rising tensions that it generates. The world is being reorganized into clearly differentiated financial blocks, with an more and more deep and open fracture between the United States-Europe axis, and even inside it, and the China-Russia alliance accompanied by the BRICS economies. The Russian invasion of Ukraine has solely accelerated this development, catalyzing a reconfiguration of worldwide commerce relations that forces Europe to rethink its strategic positioning from its foundations, each political, army and, above all, financial. Furthermore, this rigidity threatens to destroy the very foundations of the Union at a time when progress in the direction of a worldwide technique for the continent requires extra dedication, and never much less, from its companions.

For all these causes, the projections for Europe on this new context are worrying. The analyzes carried out by the Joint Research Center based mostly in Seville present a progressive lack of particular weight on the planet GDP in the direction of 2050 of the economies of the previous continent, a development aggravated by numerous components, amongst which a declining demographic stands out.

But past these macrotrends, the prognosis that Professor Díaz Lanchas noticed match to clarify not many days in the past in an exquisite convention in Seville identifies three crucial vulnerabilities that require instant consideration: an financial opening that, paradoxically, has made us extra dependent; a productiveness hole with the United States that threatens to widen; and a strategic dependence on China in important merchandise that compromises our autonomy.

This final level deserves particular consideration. The identification of greater than 300 crucial merchandise in a examine led by the European Commission for the functioning of the European Single Market, with a excessive focus of suppliers in particular geographies, poses a strategic dilemma of the primary order. The paradox is served, because the query arises about how Europe can keep the mandatory commerce relations with China, which improves and advantages the well-being of European customers, however with out compromising its financial safety and strategic autonomy. The reply to this query will largely outline the way forward for the European challenge.

However, within the midst of this seemingly gloomy outlook, Europe retains extremely worthwhile strategic belongings. Not all the things is, subsequently, damaging. Its management place within the providers sector inside Global Value Chains represents a vital aggressive benefit in a world the place commerce in providers positive aspects prominence. The Draghi report factors out the way in which ahead: a triple technique that’s dedicated to recovering the capability for innovation and funding, facilitating enterprise progress, and decisively embracing the Artificial Intelligence revolution.

The report’s proposals are concrete and bold: considerably improve funding in R&D, each private and non-private; develop deeper and extra dynamic capital markets, which is undoubtedly one of many best present weaknesses; and tackle structural deficiencies within the European labor market. The want to advertise the expansion of European firms is particularly pressing, given the notable deficit of “unicorns” in comparison with the American ecosystem. In this regard, it’s essential to resolve the Gordian knot that European regulation imposes and infects its states and areas, and that undoubtedly limits and weakens the flexibility of European firms to develop, in addition to to hold out giant funding tasks.

Thus, the following crew on the head of the European Commission must face a tightrope stroll activity: strengthening ties with the United States with out irremediably dynamiting relations with China. This delicate diplomatic train would require unprecedented ranges of coordination between Member States and a mobilization of sources at European stage, probably articulated by an bold NextGen 2.0.

The “slowbalization” represents, in short, both a challenge and an opportunity to reinvent the European economic model. Success in this enterprise will depend on our ability to transform current vulnerabilities into future strengths, decisively betting on innovation, strategic autonomy and technological adaptation. The moment demands a response equal to the circumstances: coordinated, immediate and ambitious.

The professor ended his presentation by mentioning that the historical past of Europe is marked by crucial moments overcome due to willpower and imaginative and prescient for the longer term. Today, confronted with this new crossroads, we have to get well that transformative spirit that characterised the founding fathers of the European challenge. The path is laid out, the instruments recognized. All that is still is the political will and unity of motion to show this second of disaster into the catalyst for a Europe that’s stronger, extra resilient and higher ready for the challenges of the longer term.