24 May, 2024 | Víctor Burguete
THE EU’s ROLE IN THE FUTURE REFORM OF GLOBAL GOVERNANCE
Global governance has been eroded by two of the most defining trends of the last fifteen years: power rivalry and changes in globalization. Both trends have been reinforced by subsequent crises, such as the Covid-19 pandemic, the Russian invasion of Ukraine, and the acceleration of global warming, each having a profound impact on the global economy, environment, and human security.
The rise of geopolitics and reconfiguration of globalization challenge effective international cooperation and are among the main causes of the weakening of global governance. According to United Nations Secretary-General António Guterres, “the world is gridlocked in a colossal global dysfunction” as geopolitical divides are undermining the work of the Security Council, international law, and people’s trust and faith in democratic and multilateral institutions. In this context of rivalry, uncertainty, and insecurity, in which collective action is scarce, how can the European Union (EU) improve its capacity to navigate global risks and seize the opportunities that may arise?
The REGROUP foresight paper The EU and the future reform of global governance: risks and scenarios after Covid-19 explores various potential futures based on the reform of global governance and the EU’s role in shaping it. The paper uses scenario thinking in a ten-year horizon to delve into the trajectory of these trends, and examine how risks and opportunities may evolve in the coming years. The scenarios imagined are neither based on probabilities, nor are they forecast. Rather, they are used as a strategic foresight tool that enables policymakers to consider different plausible futures and design better policies.
FOUR SCENARIOS AND THEIR IMPLICATIONS
The figure below summarizes the four scenarios analyzed in the paper.
The first scenario—”The World of the Global South”—describes a world where there is process of global governance reform, but in which the EU does not play an active role. This world is multipolar, multilateral and features a significant degree of south-south cooperation. The global landscape witnesses an open form of regionalism in which plurilateral and regional agreements assume greater significance. Regarding human security, in this scenario the notion of universal human rights is questioned, leading to a relativization of concepts such as democracy and human rights. Gender equality is deprioritized, and there is an increased role for state intervention. In Europe, the perceived decline in the EU’s global status relative to the global south casts doubt on liberal values and Europe’s economic model. The quality of democracy deteriorates, leading more European countries to become hybrid regimes.
A second scenario, “Green Globalization”, is more optimistic about the role of the EU in shaping the reform of global governance. By 2035, sustainability is at the heart of the new globalization. EU policies and values are used as a global benchmark. For instance, EU’s Carbon Border Adjustment Mechanism (CBAM) has a major impact on climate by providing a broader carbon market model and fostering decarbonization in third countries. Regarding the economy, new trade and financial rules allow technological diffusion and a higher degree of cooperation in the face of financial turbulences. Power competition is limited by institutional “guardrails” and the EU has a notable degree of strategic autonomy.
A world in which, notwithstanding EU leadership, a process of global governance reform remains absent, is depicted in the third scenario: “Complex prosperity”. By 2035, strategic competition remains paramount in the international arena. Countries have adopted protectionist measures and non-tariff measures justified by national security concerns. Strategic sectors are defined in a very broad sense, hampering financial flows and technology diffusion. Diminished international cooperation hinders global financial reforms, complicates debt restructuring processes, and stalls the ecological transition. By 2035, the EU’s technological gap and dependencies on external sources increases and the Union finds itself isolated in a world dominated by the United States and China. Yet the Union maintains its cohesion under strong leadership and enhanced integration.
A more grim scenario, finally, is describe in the “Fragmented world”. This is a set-up with no significant process of global governance reform, nor EU leadership. By 2035, power rivalry and geoeconomic fragmentation lead to the collapse of Bretton Woods institutions. Economically, the world experiences stagflation and increased unemployment. Climate change and human rights have become secondary concerns. Internal divisions within European countries hinder the consensus needed for the EU to propose global governance reforms and demonstrate leadership, and the gap between European challenges and capacities widens. Budget constraints limit EU solidarity, and inward-looking policies create tensions within the Union, which has by now become more of a forum to coordinate national policies rather than a place to build a common project.
RISKS AND OPPORTUNITIES
While each of the above scenarios holds risks as well as opportunities for the EU, the latter does not thrive in all of them. In scenarios where a process of global governance reform is absent, risks are more pronounced, and prosperity is more complex for the EU. Conversely, if a process of global governance takes shape, the EU is better able to cope with foreseen risks and becomes more resilient in the face of an uncertain future. In any case, the EU is better positioned for the future to the extent that it can exercise political leadership, supported by internal cohesion.
This article highlights some of the findings in the REGROUP paper “The EU and the future reform of global governance: risks and scenarios after COVID-19“.
