Redefining Europe’s economic sovereignty

Brussels

Rome [ENA] A new report: Redefining Europe’s economic sovereignty by Mark Leonard, Jean Pisani-Ferry, Elina Ribakova, Jeremy Shapiro and Guntram Wolff has been recently published by Bruegel, a think tank established in Brussels – Belgium. According to this report, Europeans like to believe the European Union has the collective economic size and capacity to determine its own economic destiny.

But the behaviour of others global powers is progressively calling this ability into question. China and the United States, in particular, do not separate economic interests from geopolitical interests in the same way the European Union does. They utilize economic connections, from cyberspace to financial links, to gain geopolitical advantage or to serve geopolitical goals. According to the Report, Europe’s economic sovereignty is at stake. The European Union was born during the Cold War. It developed during the détente, and enlarged after the demise of the Soviet Union. It is now part of a world that is ever more shaped by the strategic competition between the United States and China.

Throughout a more or less six-decade history, the EU never took part in the antagonism between great powers. Even though several of its member states have deployed some military forces abroad, the EU has considered itself a soldier of peace. But whereas the EU does not send armies all around the world, its leaders like to believe that the EU has the collective economic size and capacity to decide its own economic destiny, to set its own rules for economic life, to negotiate on an equal position with partner economies, to overcome would-be monopolies and even to set economic standards and regulations for the rest of the world. Sovereignty, for the EU as a whole, is first and foremost economic sovereignty.

The collective capacity of EU countries working together to preserve their economic independence reinforces the argument that the European integration process provides value to Europe’s citizens. That argument is boosted by the EU’s ability to participate in defining the rules of the game for the global economy – what Chancellor Merkel calls Handlungsfähigkeit and the French call Europe puissance.

The Report examines the specific problems that China and the US pose for European economic sovereignty, and considers how the EU and its member states can better protect European economic sovereignty in a range of areas, including state aid to domestic industries, competition policy, investment screening, export controls, the international role of the euro, the role of European development banks, the European payments infrastructure and the global governance system. http://bruegel.org/wp-content/uploads/2019/06/PC-09_2019_final-1.pdf