Thriving in the age of Eurasia

Stronger Sino-EU ties essential for well-being of both sides and creating a better global order

We live in a world roiled by geopolitical turbulence, disrupted supply chains and high inflation. The resilience of the global economy needs to be strengthened, as it is increasingly dominated by geopolitical considerations.

But that is not an easy task, especially in light of the current deglobalization tendencies.

These factors, together with the megatrends of today, such as sustainability and the digital economy, require a new kind of thinking that is characterized by out-of-the-box ideas, long-term visions, measurable targets and mutual understanding.

Knowledge is the most essential resource of our interconnected economies today. Knowledge rests on talent and creativity, which contribute to the renewal of ideas and highlight new, undetected fields and connections.

Knowledge is unique, in the sense that its value is growing exponentially by being shared, though at the same time, it is never lost by its original owner. So our most compelling task is to share knowledge. As in the past, throughout the age of the ancient Silk Road, the great achievements in science, architecture, arts and business resulted from interactions between Europe and Asia.

In recent decades, the world’s economic center of gravity has been returning to the heart of Eurasia, due to the rise of China and other emerging Asian economies and their rapid adoption and development of the industries of the future.

Europe and Asia can only be successful and competitive if they cooperate, and this cooperation will bring about the age of Eurasia. This new era is palpable in many areas, from financial digitalization and geoeconomics to technology and education.

Eurasia is two continents but one geographical unit, and it has thousands of years of strong economic, social and cultural relations.

The rivalry between China and the United States has become the principal paradigm of international relations since the start of this century, and it is having a profound impact on the dynamics of multilateral cooperation. The struggle between the two great powers also concerns the European Union, which needs to take today’s megatrends into account.

It is vital for the EU to maintain healthy and stable political and economic relations with China to safeguard the bloc’s own economic interests, and to strengthen its belief in the benefits of multilateralism and rules-based international order.

Instead of confrontation and division, the opportunities for cooperation and their 20-year-old engagement should be used and carried forward to improve their competitiveness and tackle global and regional challenges.

Based on International Monetary Fund data, long-term geoeconomic fragmentation would cost up to 7 percent of global output, and if technological decoupling is added to the mix, some countries could see losses of up to 12 percent of GDP.

For several decades, the EU mostly focused on economic integration, but recently it has been seeking to determine its interests and priorities not only in terms of the economy but also in geopolitics.

Besides promoting the internal economic integration process, the EU now needs to define independent foreign policy objectives and interests from an international perspective, since this is the only way the bloc can become stronger and maintain its position in the face of the challenges posed by the rivalry between global powers.

It is crucial for Europe to manage the shifting geopolitical landscape proactively rather than in a reactive manner, by being aware of the causes, effects and connections of geopolitical processes, such as the challenges to produce and transport necessities like grain or microchips. Furthermore, geopolitical tensions between the major economies significantly raise threats to financial stability.

Improved cooperation is especially important when it comes to issues that are now inescapable, such as green finance, the digitalization of central banks, and worldwide financial stability. To be able to respond quickly to international events, the EU must be aware of the changes occurring in the global balance of power.

This is the reason we firmly believe that Hungary is well positioned to act as an intellectual hub for professionals from various Eurasian countries, because it is situated at the crossroads of many significant routes between Europe and Asia. It is more than capable of continuing to bring together influential decision-makers, entrepreneurs, business executives and academics to exchange views on the unavoidable changes needed to achieve sustainable development and to strengthen knowledge-sharing mechanisms within Eurasia.