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January 2024
Dear Readers,
We continue our tradition of kicking off the new year with an outlook supplied by our team of Europe analysts on the major themes and events that are likely to shape events. These are mainly a string of elections that will span the entire globe – but other, less tangible events may prove equally important.
Further articles cover the apparent new normality of supply chain interruptions, Europe’s Economic Security Strategy and, specifically, Germany’s endeavors to de-risk its economy. We then move to the broader EU debate on new fiscal rules and also offer an assessment of the key geopolitical risks faced by the bloc in 2024.
With the U.S. primaries now in full swing, we dedicate a final piece to the possibility of a new Trump presidency, focusing on what the EU can do to prepare for this scenario.
With warm wishes,
Stephan Vopel and Malte Zabel
Director and Co-Director
Europe’s Future Program
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14 Major Events that Could Shape Europe in 2024
2024 has already been dubbed the year of elections, with important votes taking place in the U.S., the EU, the UK, and Georgia, to name but a few. Our Europe experts preview these and other major themes than can be foreseen in 2024, such as European decisiveness when facing up Russian aggression, the success of European Political Community and Hungary’s turn to run the EU Presidency.
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The New Normal: Supply Chain Interruptions
After the fall of the Iron Curtain and China’s integration into the world economy, international trade increased significantly. The Lehman bankruptcy first put a damper on this development. Then, in recent years, disruptions to global supply chains have further interfered with cross-border trade. It is to be feared that such disturbances will increase rather than decrease. This has negative economic consequences for all economies. The EU should prepare for supply chain disruptions to continue.
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European Economic Security: New Ideas and Next Steps
This month, the EU released an economic security package focused on FDI screening, research security, and export controls regarding dual-use goods. The Commission has thus reaffirmed its geopolitical ambition. Now, the responsibility shifts to the Member States, who have yet to practically support their declarations regarding the pivotal change represented by the Zeitenwende.
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Germany: Why Europe Cannot Rely on Business-led De-risking
The EU has faced a harsh reckoning with the rise of strategic dependencies and resulting vulnerability. Germany’s position is particularly critical due to its exceptionally deep integration into the global economy, especially with China. The country’s approach thus far, however, suffers from misconceptions about the role of business in fostering resilience, with implications for a wider EU strategy.
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Negotiations of New Fiscal Rules are Coming to a Close
EU institutions are intensively negotiating to reform the European Union’s fiscal framework and balance strict fiscal rules with the need for flexibility and sustainable investments. Key decisions are expected in 2024. The final outcome of the negotiations will be crucial for the EU’s future economic resilience and climate goals. We look at the Commission’s proposal and the current member state debates.
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Slow Recovery, Geopolitical Risks – Europe’s 2024 Economy
The global economy grew slightly faster in 2023 than hoped at the beginning of the year. This recovery process is likely to continue in 2024. However, there are also several uncertainty factors that will put a damper on companies’ investment activities – and, therefore, also on economic development this year. We examine the key issues, outlining the key factors to watch out for.
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Determined to Deter? The EU’s Anti-Coercion Instrument
The EU Anti-Coercion Instrument entered into force on December 27, 2023, an important step to protect the EU as trade becomes increasingly weaponised. The EU now needs to fill its anti-coercion strategy with life, by aligning it with its de-risking plans, managing the Council’s active involvement and using the ACI as an assertive communication instrument. We take a deeper look at the stakes.
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Taiwan Election: The EU Should Help Defending the Status Quo
Written ahead of the event, this piece looks at the stakes of Taiwan’s January election, which took place amid geopolitical tensions. The outcome will have significance far beyond the region, with Taiwan's new leadership confronted with increasing pressure from Beijing. The EU should strengthen relations with Taiwan, all while firmly maintaining its “one China” policy.
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The EU Must Steel Itself Ahead of 2024 U.S. Elections
As 2023 came to a close, the United States and the European Union reached yet another interim deal to forgo their longstanding dispute over steel and aluminum tariffs through 2025. This short-term deal is no more than a short-term fix. The EU must prepare itself for a potential return of Trumpist trade policy after the U.S. elections. We look at what this means.
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In the next edition
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The next edition will include an assessment of 60 years of Franco-Chinese relations as well as an analysis of the EU’s Critical Raw Materials Act.
To keep abreast of our work, please keep an eye on our blog: globaleurope.eu
Or follow us on social media: http://twitter.com/GED_Tweet
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