Future-proof strategies for Europe
vbw – Bavarian Industry Association
2024
The world (economic) order is off the rails: In addition to the digital and green transformation, global trade is increasingly dominated by deglobalisation, disrupted value chains and geopolitical uncertainty. Germany and Europe's economic power is being put to the test.
In this context, Prognos examined possible foreign trade strategies. The short study on behalf of the Bavarian Industry Association shows – the USA and China will set the main course, but Europe also has room for manoeuvre. Companies and foreign policy can seek out new international partners, strengthen multilateral relationships, and thereby reduce geopolitical risks as much as possible.
Europe, and in particular Germany, have for decades benefitted from globalisation and the prevailing economic order. In recent times, however, it seems that cross-border cooperation has, at best, reached stagnation. The foreign trade sustainability of the European – as well as the German and, thus, also the Bavarian – business model is at stake.
Broadly, four external economic strategies are conceivable:
Overall, de-risking represents the best possible middle course among the four strategies.
Internationally active companies can implement the de-risking strategy by adapting the concept to their business model and risk profile. Policy makers are responsible for the following tasks:
The study is based on the analysis of statistical data and the evaluation of the relevant scientific literature. In addition, we draw on the preparatory work from previous studies conducted on behalf of the vbw – Bavarian Industry Association.
To the study (vbw website, in German)
Project team: Dr Michael Böhmer, Johann Weiss, Eva Willer
Latest update: 17.04.2024
Senior Project Manager
Consultant
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Prognos is one of the oldest economic research centres in Europe. Founded at the University of Basel, Prognos experts have been conducting research for a wide range of clients from the public and private sectors since 1959 – politically independent, scientifically sound.