Stockholm (Ekonamik) – Europe faces twin internal and external challenges in the era of COVID-19 and rapid de-escalation of globalization. With the Trump administration’s “America First” approach to trade scorning the established multilateral approach to the global economy, and China’s economic power, the EU is caught in the middle of a new Cold War. At the same time, the EU, as a product of an age of multilateral globalisation, is at a disadvantage. While it has historically been positioned to thrive economically and politically when the outside world has reflected its own principles of free economic exchange and coordination, it is not clear it is prepared for the unilateralism that seems to dominate the emerging new world order.
The Coronavirus crisis is the latest internal challenge for the bloc after a decade of turmoil. and political and geographical fragmentation between its members. Ignoring the crises of the early 2000s, which appear mild in comparison, the bloc entered a new age of instability following the 2008 financial crisis. Within two years, that crisis began reshaping itself into the 2010-2015 sovereign debt crisis, which was promptly followed by the 2015 migrant crisis. Then, in 2016, the Brexit referendum opened the stage for the UK’s departure and endless negotiations that are still ongoing. It also normalised debates of secession, renewed nationalism and populism across the bloc.
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Image by Julien Warnand/EPA-EFE
