Germany’s Number 1 Task: Renew the Global Economic Order

Peter S. Rashish © Peter S. Rashish

The new Federal Government should make the support and reform of the global economic order a priority. Possible avenues for achieving this goal include the revival of the TTIP negotiations, the strengthening of the Eurozone, and an investment in global relations with like-minded countries. This is the opinion of Peter S. Rashish, Senior Fellow at John Hopkins University.

The most important contribution the new German Federal Government can make is to support and reform the global economic order that has been responsible for 70 years of peace and prosperity. Whether it is through institutions like the World Trade Organization and the European Union, countless bilateral trade agreements, or the informal norms and principles governing international commercial activity, these are all largely transatlantic concepts. However, the individual components of the liberal economic order need to be strengthened and updated to account for new developments impacting Germany’s economic relationships (for example, digital trade). Germany can help to do that in three key ways. 

Encourage the United States to resume the TTIP negotiations

First, Germany can encourage the United States to revive the Transatlantic Trade and Investment Partnership, perhaps with a new name that emphasizes more clearly the way such a strategic accord could promote both U.S. and German economic growth and their broader national interests. The Trump Administration could warm to this idea if it included a commitment to adopt a common approach to state-owned enterprises and other aspects of China’s geo-economic objectives.

Make the Eurozone more resilient

Second, the new Federal Government should embrace the opportunity presented by the new "radical centrist" and pro-European government under French President Emmanuel Macron to make the Eurozone more resilient to external shocks – for example, by reducing trade imbalances among EU Member States.

Invest globally in relations with like-minded countries

And third, Germany should invest in its relationships with like-minded countries around the world to create "relay stations" for its global economic values and interests, especially with emerging economies. There is no better place to start than with Argentina, to which Germany will hand off the G20 presidency at the end of this year.

Peter S. Rashish is a Senior Fellow and Director of the Geoeconomics Program at the American Institute for Contemporary German Studies at Johns Hopkins University. He has previously served as Vice President for Europe and Eurasia at the U.S. Chamber of Commerce and as an advisor on transatlantic economic issues to two U.S. Presidential campaigns.