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Europe's Challenges

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Release Date:

May 2016

Europe’s challenges

In these times of profound skepticism towards the European integration project, it is worth remembering that as of the beginning of the 21st century, Europe can claim a series of successes. Its integration models have attracted most of the Central European nations that broke away from communism. Democracy and the rule of law have taken root in most of Central Europe. The common currency has emerged reinforced following the Greek crisis, and the Eurozone economy seems to be again on a growth trend in the first semester of 2016. In spite of its bureaucratic complexities and actual shortcomings, the European Union model of integration remains an example for all regions in the world that seek regional integration. The European Union enjoys a rather good image in most of the world, except in Russia where it is painted by the official media as a decadent enemy and the main cause for the conflicts in Ukraine. Unlike the US, the EU is rarely seen as an imperialistic power, again apart from Russia.

Nevertheless, in today’s rather chaotic world, Europe is still fighting hard to figure out how to contribute solutions to global threats and challenges. The Obama Administration has shown a clear tendency to retreat from the world’s hottest conflicts. American voters have expressed clearly that they do not want their country to be the sole policeman of the world any more. Europe has been called to task several times and publicly by President Obama to play a greater part in the wider world and to enhance its defense efforts. The Common Security and Defense Policy created by the Lisbon Treaty in 2009 gives the EU most of the instruments it would need to become a real actor in foreign policy. It now has an External Action Service, with “embassies” in the world, a High Representative capable of giving the EU a face and a voice on the international scene; it can trigger EU military and civilian missions in zones of conflict. But the Lisbon treaty has not meant in any way a transfer of sovereignty from member states to Brussels.

This is a serious impediment to the very efficiency of the system. When a serious fire starts somewhere, the EU is quickly put aside, often by its very member states, which decide to take the lead. This has been quite visible in recent African conflicts, where Paris has proved much more proactive than Brussels, has contributed the most troops to EU military missions and has always pushed the EU to act when a majority of member states did not want to go. It is even more visible in the Ukraine conflict. No EU representative is involved in the Minsk process, but Germany and France are present. ‘We are comprehensively briefed by Paris and Berlin’ is the standard answer in the External Action Service when questions are asked about their involvement in the Ukrainian negotiations.

The other key challenge for the coming years will be to defend Europe’s competitiveness in an era of relative decline. According to the World Intellectual Property Organization (WIPO) patent filing report, in 2014 Europe remained in the top five most innovative places in the world. But it filed 152 662 patents, against 928 177 for China alone and 578 802 for Japan. The economic stagnation in the Eurozone puts the old continent in a difficult and defensive position in relation to more competitive regions of the world.  The temptation to return to protectionism has reappeared in mainstream political discourses in Europe since the 2008 crisis. But up to now, Brussels as much as EU member states have resisted the calls to go down this dangerous road. Meeting these challenges is particularly difficult for Europe due to four sets of crises.



1. Russian-Western relations have deteriorated to a point not seen since the end of the Cold War

Russia has taken an aggressive stand on the continent and invaded part of Ukraine in a rare display of disdain for international law and for the Budapest Memorandum that it had duly signed and which made Russia one of the guarantors of Ukrainian territorial integrity. European leaders now have huge difficulties in reading what Vladimir Putin wants and do not know how to keep a working relationship with a Russian government that claims day and night and on all its state media that the West is an enemy willing to destroy Russia. Russia’s economy, in spite of President Putin’s rhetoric on the “Russian pivot to the East” remains profoundly Eurocentric. Sanctions and countersanctions make both sides suffer. But Russia’s aggressive behavior has created a consensus that business as usual is not possible. Nevertheless, business as usual between the EU and Russia is exactly what the two economies badly need to boost their growth again. Vladimir Putin is widely seen in the economic circles of Europe as a factor of unpredictability and instability, chilling off investors. The constant public threatening by the Russian government has obliged European leaders to reconsider national military expenditures and has given NATO an unexpected restart. The strain on the relationship will not disappear for a very long time and consumes a lot of political energy in Europe. A strong alliance between Russia and the EU would have been profitable for both. But some minds in the post-communist area just prove incapable of thinking in a win-win model and have succeeded in creating a new confrontation that has destroyed trust on the continent for the foreseeable future.



2. Wars and disintegration of states in the Near and Middle East have a direct impact on European security, too

The wave of Arab revolutions has brought very little of the expected fruits of freedom and rule of law. People have started fleeing violence en masse, in particular from and through Libya and Syria towards Italy, Greece and the rest of Europe. Extremist movements such as Al Qaida and the Islamic State are committing horrors in the territories they control. War crimes seem to be for them a normal way of ruling. These terrorist organizations have proved capable of recruiting young Europeans who go to Syria to fight, but who are also trained to commit violent attacks in Europe, as the massacres in Paris in November 2015 and then the recent bombings of the Brussels metro and airport have proved.

This extreme violence will feed the flow of refugees for a long time.

The response to the refugee flow has created deep division within the EU. Some member states refuse bluntly any solidarity in this matter. Naked racism has surfaced more and more in the public discourse, not so much in the countries that are at the forefront of the refugee flow like Greece and Italy, but mainly in countries that have almost no refugees on their territories like Poland or Slovakia.



3. The EU is going through an existential crisis provoked both by the arrival of refugees from Syria and North Africa and by the Euro crisis

The Union, supposed to be a space of solidarity between members, is now experiencing a double North-South divide. Southern European countries like Greece, Italy, Spain and Portugal have become indebted towards the North, in particular Germany. This painful situation is now enhanced by the refugees who arrive again into the southern states.

The EU is losing traction among the public opinions of the member states.

Tensions are such that Italian Prime Minister Matteo Renzi, frustrated by his European Council colleagues’ unwillingness to show some solidarity and to set refugee quotas for each member state, reportedly said: “If this is solidarity Europe, then you can keep it”. For the first time since the creation of the Steel and Coal Community, the border-free Schengen space is threatened by member states that have unilaterally reestablished controls on their borders. Hungary has moved from a European democracy towards something strange that Prime Minister Orban calls an “illiberal state” and that looks tremendously similar in many ways to Vladimir Putin’s self-proclaimed “sovereign democracy”. Add to that the British referendum on staying or leaving the EU… These centrifugal tendencies are no solution to the structural problems facing Europe. They actually add new difficulties. But a growing number of citizens, frightened by this accumulative crisis, want to retract back to the nation state, within traditional borders controlled by their state and vote for Eurosceptic politicians.



4. Finally, Europe seems plagued by a series of domestic weaknesses that it cannot easily resolve. In almost all countries the extreme right is winning more and more votes.

These authoritarian parties have formed transnational coalitions where they share tactics. Secessionist movements have gained strength in several big European regions, like Scotland, Catalonia and Northern Italy. Europe seems also paralyzed by its inability to reform the Brussels institutions in a way that would allow the whole system to work in a much more efficient way. Public opinion is more and more divorced from an elite that is seen as representing only itself and its own interests. The astronomic compensation packages that private firm managers take for themselves while imposing austerity on their employees are seen as a betrayal of all that Europe and the very idea of democracy stand for. Politics are perceived as having lost the battle to the economic lobbies that can argue for decades and continue selling, for instance, pesticides that are proven harmful for nature and people. The disarray caused by economic elites that place profit above all and particularly above the common good might catch Europe by surprise in the coming years. And the surprise will certainly not be a good one…