Europe-Asia cooperation will be key to win-win prospects
China Daily Global


A China-Europe freight train loaded with exhibits for the upcoming  6th China International Import Expo arrives in Shanghai on Wednesday.  [Photo/Xinhua]

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, which create severe risks in terms of the  loss of efficiency gains provided by globalization.

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. For better orientation  among these megatrends, we have to use a combination of knowledge,  talent, technology and capital.

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 through 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 the past 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, big data, data centers, green and clean  technology, electromobility, biotechnology and healthcare, as well as  central bank digital currencies.

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. Connections are stronger  than barriers, especially when it comes to the flow of ideas and  innovations.

Eurasia is two continents but one geographical unit, and it has  thousands of years of strong economic, social and cultural relations to  draw on. Eurasia and the newly promoted old idea of sustainability are  two sides of the same coin and go hand in hand in the building of a  win-win world order.

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 its own economic interests,  and to strengthen its belief in the benefits of multilateralism and the  rules-based international order.

In the relationship between China and the EU, the parties have mainly  focused on economic cooperation: The EU became China's No 1 trading  partner in 2004, while China became the EU's in 2020.Therefore, the EU  has to perform a balancing act while developing its economic ties.

China has become a key player in the global economy, and it is  striving to forge close trade and economic relations with European  countries.

Because of the dependencies in the global economy, complete  independence from China is not an option in the turbulent economic times  of the 21st century. Instead of confrontation and division, the  opportunities for cooperation and their 20-year-old engagement should be  used and carried forward to improve their own 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 by  increasing financial fragmentation and having an impact on international  payment systems, asset prices and cross-border capital flows.

Improving 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.

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