Europe under attack

David Harley gives his view on the existential threats facing Europe in 2015, and the role that business can play in overcoming them:

We are only six weeks into the new year, and the European Union and everything it stands for is already under threat on multiple fronts. Even the President of the European Commission, Jean-Claude Juncker (pictured), has said that the Commission is in the last-chance saloon.

The threats and attacks on the EU are both internal and external.

Internally, the EU has numerous problems. There is sluggish economic growth across Europe, resulting in a loss of competitiveness in global markets. There is a deepening policy rift between northern and southern member states.

Political extremism is increasing on both left and right, with growing antisemitism and the emergence in several countries of ISIS-inspired (but essentially home-grown) Islamist radicalism and terrorism.

Tying together a number of these themes is the issue that has risen to the top of the political agenda in recent weeks: the possibility that incompatible approaches of the new, radical left-wing Greek government and international creditors will see Greece leave the euro.

The spur to politically centrifugal forces that would result from ‘Grexit’ is hard to underestimate. At present it is impossible to predict who will blink first in this stand-off: the only certainty is that there will be no cost-free solution. It should be possible to head off any question of Greece’s departure from the single currency, even though this week’s Eurogroup and European Council seem unlikely to resolve the issue.

The additional factor of uncertainty presented by the notion of the United Kingdom quitting the EU altogether, or ‘Brexit’, is hardly helpful at this critical time, but if sensibly managed, it should be possible to head off this possibility.

Externally, the alarm bells are sounding along Europe’s eastern flank, and specifically along the EU’s borders with Russia. Russia’s military incursion into Ukraine, in defiance of international law (though consistent with a certain Russian view of history), has unilaterally changed the post-communism settlement.

The three ‘Baltic countries’ (Estonia, Latvia and Lithuania), as well as Poland, wonder who will be next. Nato is regrouping and preparing – albeit slowly – for the worst.

Meanwhile, Europe’s southern flank remains exposed to seemingly unstoppable migratory flows from northern Africa, and to the fallout from the growth of ISIS on Iraq, Syria, Lebanon, Jordan, Turkey – and Israel.

To complete this depressing tableau, Europe also has to face the multi-sourced threat of cyberattacks.

So it can no longer be business as usual. A new, dynamic, and more broadly-based strategy is needed to respond to this mass of challenges. It is a strategy that needs to involve national governments, the EU institutions, and business leaders.

The EU would be in a stronger position to deal with all these difficult and complex issues if the European economy were to start achieving higher levels of growth.

The Union must become – and must be made to become – more business-friendly. The EU and business need each other more than ever, and the newly-appointed European Commission has demonstrated that it is open for dialogue and for a new partnership with business.

However, the Commission on its own lacks the necessary credibility and public trust to take the lead. Individual governments are too easily mired in ‘short-termism’ and narrow national interest.

It is no exaggeration to say that, in the absence of a new business and industrial strategy working in the general interest, Europe’s future peace and prosperity will look seriously compromised, if not unsustainable. Accompanying labour market reform and social measures also need to be hammered out, as today’s threats could easily turn into tomorrow’s conflicts.

There are certain historical parallels: the late 1970s and early 1980s saw sluggish or non-existent growth, internal security threats and a tense international situation.

Business, working with a purposeful Commission, helped to turn around the economic situation. It can help to do so again.

In the absence of a new business and industrial strategy working in the general interest, Europe’s future peace and prosperity will look seriously compromised

Burson-Marsteller is ready to support its clients in impressing upon the EU institutions, and the Commission in particular, the need for action. We can help highlight what needs to be done to promote the mutual interest of our clients and the bodies that set the economic, financial, and regulatory agendas under which companies in Europe have to compete.

There is much at stake, but much that can be achieved too. Burson-Marsteller will seek to draw on its own unique store of experience, expertise and creativity to give the lead and show the way forward, at the highest level.

Email to see how we can help you

Words  David Harley
Photos  (c) European Union 2015

 

Leave a Reply