The discussion underway on European economic governance reform is part of a substantially uncertain and volatile macro-financial picture. The principal risks include stagflation, financial fragmentation, competitiveness problems (in light of the American Inflation Reduction Act) and the twin (digital and sustainable) transitions.
The process of EU enlargement has been a major political and strategic success, but it is facing growing problems such as capacity for integration and political consensus among current members.
The September 26 German elections could not but be influenced by the figure of Angela Merkel. Her principal legacy is probably to have been a master crisis manager and a pillar of political stability, but she has not staked her career on promoting a truly comprehensive and ambitious vision for Europe. Even regarding the pursuit of German national interests, an overall assessment of her profile as a leader must take into account several missed opportunities for renewal and perhaps even excessive prudence.
Reviving the spirit of Europe means, first and foremost, returning to the roots of the political and cultural project of integration. While maintaining a critical stance with regard to the Union’s current practical shortcomings, we must not forget the exceptional results that have been achieved in terms of rights and guarantees that European citizens today consider normal but which are not at all so in many other parts of the world. In that sense, the ideal and historical dimension must also be combined with a pragmatic vision aimed at the efficient tackling of present priorities.
There is a broad consensus on the key issues that will determine the sustainability and efficiency of the eurozone (and the European Union as a whole). These include common mechanisms in Europe, domestic political consensus in the face of the considerable sacrifices imposed on citizens, the functioning of national institutions to introduce necessary reforms; and mutual trust between the member countries.
The main challenge identified as facing European leaders was that of striking a delicate balance between maintaining domestic political consensus (in the face of strong social tensions) and implementing necessary but painful reforms that almost without exception will only yield positive results in the medium to long term. While the worst of the financial crisis seems to have been overcome, many concerns remain regarding the overall state of Europe’s economies and the EU’s continued viability from a political and institutional standpoint.
Throughout its history, capitalism has shown an outstanding ability to evolve and adapt to changing political and technological environments.
The participants at this Aspen European Dialogue session held in Istanbul observed that the problems being experienced by the euro area in the wake of the financial crisis are linked to certain global trends (particularly movements in commodity prices). These global pressures, it was noted, have in turn triggered or fueled popular uprisings in the Arab world, with glaring socio-political consequences.
The Middle East is an increasingly diverse region where very old problems coexist with genuine opportunities for renewal and socio-economic progress. A powerful driver of change has become the Gulf, thanks to very large financial resources and a willingness to invest in the neighboring countries – as well as beyond, with a special emphasis on East Asia.
The current economic crisis is subjecting the entire “EU system” to conflicting pressures. On the one hand, the search for a synergistic and coordinated approach to economic policies would undoubtedly be facilitated if its joint institutions were performing well.
Discussion focused on economic and financial issues, bringing to light two questions in particular. The first regards the opportunity to build a new international system of rules and institutions — a Bretton Woods for the twenty-first century.
The 2007 edition of the Aspen European Dialogue the conference focused on several crucial elements of the European debate, in both political and economic terms. Adjusting to globalization is a must if the European project is to be relaunched: in this process, new domestic challenges such as the EU’s internal security and a new social compact are intertwined with the future of the euro as well as external issues such as global trade imbalances. Key institutional reforms are also indispensable, whether or not in the form of a Constitutional text.
Aspen Institute Italia dedicates the fifteenth edition of its Aspen European Dialogue to the topic Germany: the key to unlock Europe? This year’s international conference took place in Berlin, on February 24-25. The Conference started with the analysis of Germany’s new priorities: the Grand Coalition’s first decisions and challenges, social/welfare reforms, fiscal iussue and relations with Europe. The discussion then extended to the EU as a whole and possible strategies to foster economic growth and reinforce the eurozone. The debate also focused on the importance of new budget policies.
The 14th edition of the Institute’s Aspen European Dialogue focussed on possible scenarios for Europe in the coming decade: the choice between “superpower” and “super-space”, demographic problems and immigration issues, the “budget wars”, and the consequences of a French “no” to the European Constitution. Participants also considered the implications of the Stability Pact reform.
