The pace of events shaping the European policy landscape has become increasingly frenetic. Having worked in EU policy through several major crises over the past two decades, the current pace of developments is particularly striking. Each week brings a new development with significant geopolitical or economic implications. Issues that might previously have dominated policy debates for months are quickly overtaken by the next major event.
Against this backdrop, moments that allow us to step back and assess where Europe stands are increasingly valuable.
Last week I attended a discussion at the Institute of International and European Affairs in Brussels titled “Turbulent Times: The EU between Putin and Trump,” featuring Jim Cloos. The event focused on how the geopolitical environment facing Europe has shifted in recent years and what this means for the EU’s strategic position between major global powers.
By coincidence, earlier that same day, I had come across an analysis by Adam Posen titled “Strategic Direction for Europe in the New Economic Geography.” In the piece, Posen argues that Europe needs to take a more clear-eyed view of its economic position in a changing global landscape. Rather than focusing primarily on perceived vulnerabilities, he suggests policymakers should assess both Europe’s structural strengths and the constraints that shape how effectively those strengths can be used.
Although these perspectives emerged from different contexts, they raised a similar question: how should Europe assess its position in an increasingly complex geopolitical and economic environment?
The event was held under Chatham House rules. The reflections below, therefore, summarise the themes discussed rather than attributing remarks directly to participants.
The current context
Both the IIEA event and Posen’s analysis begin from a similar starting point: the environment in which Europe operates has changed significantly.
Russia’s war against Ukraine continues to reshape Europe’s security landscape. The return of Donald Trump to the White House has brought uncertainty into the transatlantic relationship. At the same time, global economic competition with China is intensifying, particularly in areas such as technology and industrial policy.
These developments have contributed to a growing debate about Europe’s strategic position and its ability to respond effectively in a more contested international system.
Europe’s position
During the IIEA event, it was noted that Europe is operating in a geopolitical environment that differs markedly from the one that shaped policymaking after the end of the Cold War.
For several decades, policymakers assumed that the international system would gradually converge around liberal democracy, open markets, and rules-based cooperation. Today that assumption appears increasingly difficult to sustain.
Instead, the international environment is characterised by strategic competition between major powers, growing economic security concerns and pressure on multilateral institutions. Europe therefore faces the task of defining its role within a system shaped simultaneously by geopolitical rivalry and immediate security pressures.
Europe’s economic strengths and weaknesses
Posen approaches Europe’s strategic position primarily from an economic perspective. In “Strategic Direction for Europe in the New Economic Geography,” he emphasises that Europe remains a major economic actor with significant assets, including the scale of the EU’s internal market, its regulatory influence, and its advanced industrial base.
At the same time, he notes that Europe’s economic geography also presents challenges. Fragmentation within the single market, uneven integration of capital markets and political caution can limit Europe’s ability to translate its economic scale into strategic leverage.
This suggests that Europe’s situation cannot be fully explained by focusing only on stories of decline or strength. A realistic assessment requires examining both the capabilities Europe possesses and the institutional constraints that shape how they are deployed.
Where the arguments overlap
This perspective resonated with many of the themes raised during the IIEA event in Brussels. While Jim Cloos’ intervention focused more on the geopolitical pressures facing Europe, the underlying message was similar: understanding Europe’s role today requires a clearer assessment of its strengths as well as its limitations.
Both perspectives suggest that Europe’s challenge may lie less in the absence of capability and more in how effectively it mobilises the economic, institutional, and political resources it already possesses.
From reacting to thinking strategically
Taken together, these reflections suggest that Europe has spent much of the past decade operating in a reactive mode, responding to successive crises.
Recent developments have demonstrated that the EU can act collectively when political will exists. Examples such as joint Covid vaccine procurement, coordinated support for Ukraine and unified responses to geopolitical tensions (e.g. Greenland), illustrate the Union’s capacity to mobilise effectively.
However, many of these developments have emerged in response to immediate pressures rather than through long-term strategic planning.
Implications
This emphasis on assessing Europe’s position also echoes elements of the competitiveness agenda outlined by Mario Draghi. His recommendations, widely reported and reflected in the current European Commission’s priorities, highlight the need to better leverage the scale of the single market, address fragmentation in capital and investment markets and mobilise Europe’s existing economic strengths more effectively.
The broader implication emerging from these perspectives is that the debate about Europe’s role may need to be framed differently. Rather than focusing primarily on perceived vulnerabilities, the challenge may lie in recognising and mobilising the capabilities Europe already possesses.
For businesses and policymakers alike, the key question is therefore not simply how Europe reacts to external pressures, but how it assesses and mobilises its economic and institutional strengths in a more contested global environment.