Location Europe: Strategic vision is lacking

Global change poses serious challenges for the European Union. Geopolitical power shifts require clear strategies, political determination and the courage to come up with new ideas. Concrete problems include the increasing fragmentation of the global economy and high energy costs, but also raw material dependencies and intensified technology competition. These are the core statements of a current study on the future opportunities of the EU, which was prepared by the FERI Cognitive Finance Institute in cooperation with the CEP, Centrum für Europäische Politik. "The EU is increasingly in danger of being pulverized in the systemic conflict between the US and China. At the same time, Europe's economy is losing its connection to important future markets. This makes it clear: Europe's current 'operating system' needs an update!", says Dr. Heinz-Werner Rapp, Board Member of FERI Management AG as well as Head of the FERI Cognitive Finance Institute.

Strategies instead of visions

The general conditions analyzed in the study and the future prospects and options for action derived from them paint a sobering picture: According to the study, the greatest challenges for the EU's free trade-oriented economic model lie in protectionist tendencies and the increasing fragmentation of world trade. In order to secure prosperity in the future, the EU must work to dismantle trade barriers and improve competitive conditions for European companies. This is only possible through cooperation with reliable partners who offer access to innovation and future resources. To this end, the EU must become more pragmatic in its external relations and explicitly take strategic security interests into account: "Instead of fine visions, Europe needs clear strategies that are not only forward-looking and solution-oriented, but that also stand up to reality," demands FERI board member Rapp.

Europe loses radiance

With the goal of climate neutrality by 2050, the EU has proclaimed a very ambitious agenda. However, the impact of the "Green Transition" on Europe's competitiveness is currently still completely open. "The current energy policy, especially in Germany, shows the obvious strategy deficit of the European Union. For entrepreneurs and investors, this is a serious problem. Former locational advantages are losing their appeal everywhere in Europe," warns Rapp. In the race for future market leadership in low-emission energy systems, the EU has not yet found a groundbreaking answer. The same applies to the field of artificial intelligence, where Europe is already clearly lagging behind the USA and China.

Technological transformation requires free competition

Europe's problems were largely homemade and due to its own failures over many years. To find an effective response to global challenges, the EU's strategic shortcomings must be openly addressed and resolved, he said. "Increased external risk awareness and the reduction of internal structural problems are the keys to a successful future for the EU," says Prof. Dr. Henning Vöpel, Director of the CEP and Chairman of the Stiftung Ordnungspolitik. For "Made in Europe" solutions, rule-based free competition in the internal market would continue to be preferable to state regulations. This begins with the construction of a new energy infrastructure and ends with votes on AI rules, he said. "A subsidy race between member states does not help anyone in the EU. As a key player in industrial value chains, Germany has a special responsibility here," Vöpel said. Only with a single market without barriers that creates demand and generates decentralized innovation would Germany and the EU become attractive partners for solving the major global challenges of our time.

Mixed picture for entrepreneurs and investors

Entrepreneurs and investors should not be deterred by the obvious problems of the EU, however, but should rationally and without naivety seek out possible opportunities and actively exploit them. What is needed for this, however, is a greater sense of reality and creative power at the political level. "As long as the EU fails to counter the future plans of major competitors such as the USA or China with a clear strategy, Europe as a business location will be under pressure," explains Rapp. This means that the key question of the study - "Quo vadis, Europe?" - ultimately becomes an individual question that every entrepreneur and investor must answer for themselves.

The study "Quo vadis, Europe?" is available as a German short version in the download area of this page.