Brussels (The Brussels Morning Newspaper) – Europe’s economy must meet the challenges of the war in Ukraine and steer trade ties with China, EU Commissioner for Economy Paolo Gentiloni expressed.
The European Union has successfully evaded the “terrible prophecies” that endangered its economy in recent years, but must still compete with Russia’s war in Ukraine and a tenuous trade connection with China, outgoing European Commissioner for Economy Paolo Gentiloni stated.
The bloc’s economy experienced “overall weak growth, but nothing of the horrible prophecies that we heard in the last two or three years: recessions, blackouts, divergence, separators in Europe in front of Russia’s invasion,” Gentiloni stated.
How Does Gentiloni View Europe’s Future Competitiveness?
“The economy is expanding, slowly, but expanding. And the risks of differences among the European Union, which was very elevated when the pandemic happened, are very little,” he stated. “The bad part of the declaration is that if we don’t raise our capacity in terms of competitiveness if we don’t earn enormous progress in what we call the capital markets union, and if we don’t handle the challenge of defence… if we don’t do that, well, the new situation of the world will appear very difficult for Europeans.”
In its spring projections, the European Commission projected the EU’s GDP will surge by 1% in 2024 and by 0.8% in the euro area, with respective increases of 1.6% and 1.4% in the two regions in 2024. At the time, the Commission lagged growth on the back of accelerated private consumption, declining inflation, and a healthy labour market, but also broader geopolitical threats amid ongoing conflicts in Ukraine and the Middle East.
How Will the EU Navigate China Trade and Geopolitical Tensions?
Gentiloni highlighted that trade diplomacy with China and the fighting in Ukraine must top the agenda of challenges facing a new EU Commission — and that they are more urgent concerns than the advent of a potential second U.S. government under former President Donald Trump.
The European Union must “support Ukraine, maintain the doors of international trade open” but also “abandon our ingenuity in the trade relation with China. But this does not imply that we can accept the view that international trade and international trade rules [are] over,” Gentiloni stated.
He de-emphasized the economic effect of a Trump victory in November, adding, “I think that a change in the U.S. administration, meaning Trump winning the election, of course, it will not be welcome in Brussels, but I don’t think that the change would be enormous in terms of economic relations.”
Moreover, he said: ”So I have [a] great belief that [people] can change and be able to deliver better performances than they have done previously. But [it is] challenging to think so. So I try to sustain the EU Commission as much as we can, but being a rational man, I think we failed the desire of the voters for transformation, and the same establishment [is] still in standing in Brussels, and it’s not good.”
