The longer the pandemic lasts, with its detrimental financial and social effects, the higher the chances for terrorist groups to increase their influence in Yemen, Iraq, and Syria and spread this to neighbouring countries.
The coronavirus pandemic, and the resulting severe economic disruptions, can only be effectively tackled with a European and global response. The degree of integration and interdependence between member states – economically, politically and socially – means that in dealing with the virus and its economic effects, the EU is only as strong as its weakest part. Governments have to devise a more forward-looking, collective response. Hesitation and the failure to tackle the problem collectively will increase the losses – in terms of lives, economic wellbeing, political stability and EU unity.
Topic:
European Union, Economy, Political stability, Coronavirus, COVID-19, and Health Crisis
While the ECB has already taken bold steps, the EU member states need to support its efforts by committing to underwrite together some of the fiscal costs of the COVID-19 Pandemic. The best option would be to launch a Corona Fund with the power to mobilize 1 trillion EUR—support for such a fund need not be unanimous.
Topic:
Regional Cooperation, European Union, Economy, Recovery, Pandemic, and COVID-19
Christian Mölling, Torben Schütz, and Sophia Becker
Publication Date:
04-2020
Content Type:
Policy Brief
Institution:
German Council on Foreign Relations (DGAP)
Abstract:
Due to the COVID-19 pandemic, Europe is headed for a recession that will dwarf the economic downturn after the 2008 financial crisis. The impact on national defense sectors could be devastating. But as crisis and responses are still in the early stage, governments can still take measures to mitigate the effect on defense. To safeguard political and defense priorities, EU and NATO States need to act jointly and decisively.
Topic:
Defense Policy, NATO, European Union, Deterrence, Pandemic, and COVID-19
The Communist Party of China (CPC) plans for China to achieve effective global dominance by 2049. It is using the major global crisis caused by the COVID-19 pandemic to secure strategic advantage through propaganda and disinformation, assertive, sometimes aggressive diplomacy, pursuing targeted investments, and offering “health cooperation.” The CPC has long targeted European business and political elites to build constituencies of support. Europe must counter by building robust societies based on core democratic values.
Topic:
Foreign Policy, COVID-19, Chinese Communist Party (CCP), and Health Crisis
As the coronavirus pandemic fuels technological and geopolitical competition among the great powers, Europe’s relations with China and Russia are facing new challenges and risks. Still, the reconfiguration of power in Eurasia also brings unexpected opportunities for European actors in the area of connectivity. To seize them, the EU needs to reconcile its aspiration to be a globally accepted “normative-regulatory” power with both its limited financial means and its more assertive attitude to geopolitics.
Topic:
Science and Technology, European Union, Geopolitics, Strategic Competition, Pandemic, and COVID-19
The Conference Board and ERT have established a collaboration to create a new measure of CEO Confidence for Europe. The Conference Board Measure of CEO Confidence™ for Europe by ERT for the first half of 2020 is 34 (on a scale from 0 to 100). The report examines the survey results including CEO views about business and economic conditions now, conditions in six months, and the prospects for their own industry. The negative sentiment among business leaders resulted from the dramatic impact of the COVID-19 crisis which delivered a severe supply shock to the economy in Europe and around the world.
Measures to contain the Novel Coronavirus (COVID-19) outbreak – including factory shutdowns, town-level lockdowns and quarantines, and transport bans affecting regional, national and international movement of goods and people – are resulting in a steep decline in household consumption. In parallel, ongoing disruptions of production, distribution, and retail have brought key industrial sectors to near standstill, set off ripple effects throughout regional supply chains, and created intense cash flow shortages from beginning to end of value chains. As of March 1, 2020, there has yet to emerge a definitive path to containment and remission of the crisis. Financial pressures on firms are increasing.
The challenges wrought by the crisis for Finance managers are complex and cascading: cash flows are strained by stalled supply chains and channel operations, increasing uncertainty requires wider scenario forecasting, and access to capital has tightened. If virus containment and remission cannot be achieved in the short-term, financial markets are vulnerable to both private sector bankruptcies and household mortgage defaults. The specter of financial crisis looms large.
The following assemblage of insights and learnings from our internal experts and member network will hopefully provide some helpful guideposts. The catalog below[1] essentially resolves down to three executive actions to address the challenges ahead:
Topic:
Financial Crisis, Business, Coronavirus, Industry, and COVID-19
Experience in Asia suggests that public health and medical capacity are critical for an effective response to an emerging infectious disease. Political will and previous experience with disease outbreaks also play a role. Singapore ignored an important segment of its population and is now experiencing a huge spike in cases. China and Vietnam were able to enforce draconian measures, while in Japan and Hong Kong, civil society had a greater role in initiating effective controls. In several countries, local political outcomes have been affected by the perceived success or failure of leaders in controlling the crisis.
Topic:
Health Care Policy, Leadership, Crisis Management, Public Health, and COVID-19
Political Geography:
Japan, China, Asia, Vietnam, Singapore, and Hong Kong
With both the US and China facing a long economic slowdown, the bilateral relationship between the globe's two largest economies faces massive challenges. Making matters worse, Washington and Beijing have attempted to divert domestic attention away from their own substantial shortcomings by blaming each other. Given the economic uncertainty, each side has limited leverage to force the other into making concessions. Harsh rhetoric only serves to inflame tensions at the worst possible time. For better or worse, the US and China are locked in a messy economic marriage. A divorce at this time would exact an enormous cost in an already weakened economy.
Topic:
Foreign Policy, Bilateral Relations, Economy, and COVID-19
Political Geography:
China, Asia, North America, and United States of America