Harnessing globalisation

Globalisation has generated prosperity for large numbers of people and intermeshed the world more closely. Nevertheless, many citizens also associate globalisation with disadvantages and fears. In order to stimulate the debate on global challenges and the EU’s possibilities to shape developments, the European Commission has now published the report “Harnessing globalisation."

The reflection paper points out that globalisation has driven innovation, created jobs and promoted competition as well as consumption. Each billion Euros of exports helps to secure 14,000 jobs in Europe. Hundreds of millions of people have been freed from poverty in developing countries. Yet on the other side, the transition to an economy which is closely intermeshed has also led to inequalities: it is believed that many people in western countries have lost their jobs. Furthermore, migration flows are said to have led to social tensions in many places.

What does the future hold in store?

Technological progress including digitalisation are making an essential contribution to globalisation. In this regard, the Commission observes that the world is still in the early stages of digitalisation: the trend towards automation, e-commerce, virtual financial services and renewable energies will become even more prominent in the future. The Commission underlines how important it is to exploit the possibilities of digitalisation to the full. At the same time, the associated challenges need to be addressed effectively. For instance, many tasks in factories will in future no longer be performed by employees but by machines. The role of people in companies is changing fundamentally. Policy-makers have to react with long-term education measures and labour market reforms.

What does the EU have to do?

At international level, the European Commission advocates a fair and rules-based global order, for example via a further development of the WTO system and measures for sustainable development. The Commission’s concrete proposals for external action include an investment offensive in third countries in order to promote sustainable growth there and to reduce migration pressure. With regard to foreign takeovers by technological leaders in Europe, in particular by state-owned groups from relatively oligopolistic markets, the Commission announces a thorough analysis and appropriate measures.

Inside the EU, the Commission argues in favour of better social protection of citizens: the prosperity created by trade must be spread more evenly. In addition, the single market should be strengthened and modernised. For this, the Commission announces inter alia support for various projects in the area of energy efficiency and promotion of innovation.