25 november 2020, europe: taking stock, edging forward

As the dust clears on the american election, the standard holder of the free world is somewhat tarnished. The new president will adopt a different lexicon and approach to global matters, but a still divided and inward-looking nation will not reverse the general downward drift from its unipolar moment to merely primus inter pares in the global community. Russia will continue causing storms and china changing the climate, as it showed with the recent asean regional agreement for an integrated trading zone that now encompasses some 30% of global trade and population. Other blocs though do exist, with the eu still the world's largest single market. As washington wanes and beijing becomes bolder, more than ever it is time for europe. Yet, two decades after the birth of its common foreign policy, the bloc is still well-described as economic giant but political dwarf. On the surface, things look to be getting worse, with the loss of its most influential player and its reaction to covid stubbornly persistent regulation at member state level. Even in such an inherently interdependent area as aviation, the eu has not been able to coalesce around a single set of rules. Beneath the waves though, the duck is paddling hard. With america back on the world scene, europe is again its natural partner, and in macron and merkel, there is experienced leadership. Once over its current budget squabbles, a 7-year settlement is a solid foundation, and many hope trump's loss presages that of the eu's own populists, so helping an emergence from the current bout of eurosclerosis some have diagnosed. This is usually followed by strides forward in the european project. In fact, these can already be seen, largely building on the new machinery put in place after the financial crisis a decade ago, like the eba, esma and esm, which is now coming of age. The most notable eu legacy of the crisis is the €750 billion "next generation eu" recovery fund, a genuine gamechanger not only in its size but because it is the commission, not member states, that is borrowing, and much of the disbursement is grants not loans. The stabilising effects of the ecb's €1.3 trillion pandemic purchases also showed, again, europe's monetary heft. Externally too, in areas like north africa and the middle east, europe seeks to be more muscular, as it should be in containing russia and engaging with china to avoid a world split into two ultimately competing halves. Like everywhere on earth, now is challenging, but a progressive europe is on a continuing long-term upwards trajectory, which can only be a good thing for everyone.