The Hindu Business Line : Europe's survival rests on its ability to adapt

Today Europeans view globalisation as a threat rather than as an opportunity. The real danger Europe faces, however, is "stagnation" and its inability to profit from change. If Europe must grow in strength and stability then attitude and leadership are crucial.

Twenty-one years ago legendary rock star Alice Cooper shook audiences with this song:

"You're your own worst enemy

You're a walking catastrophe

You're at war with yourself and nobody else

You're a danger

You're a mess".

Before a concert at Le Zenith in Paris, he boldly announced that he was sowing the seeds of Europe's cultural demise. A look at the happenings in Europe will tell you that his words were not mere rock-star swagger. Sample these news pieces:

"French President Jacques Chirac showed his temper and walked out of the EU summit when a French business leader addressed delegates in English... "

"The Spanish government approved measures aimed at blocking German utility E.On's euro 29.1-billion takeover bid for Madrid-based Endesa... "

"Italy has accused France of protectionism over a controversial deal to merge Gaz de France and Suez, which was a takeover target for Italian firm Enel... "

Protectionist sentiment

The upsurge in economic nationalism in France was given a push from an unlikely source — the yoghurt section of a French supermarket.

Last summer, the American food giant PepsiCo was thought to be interested in buying up the French dairy company Danone.

The gasp of horror could be down Paris' wide boulevards. Soon after, the French government came up with 11 strategic commercial sectors that should be protected from foreign takeovers.

Then came more protectionist news:

"French Finance Minister Thierry Breton expressed deep concern today that a proposed marriage of Mittal Steel owned by NRI steel tycoon Lakshmi Mittal and Arcelor lacked evidence of industrial logic, saying that cultural and employment issues were central."

"The leading French student union is refusing to meet the French Prime Minister for talks about a new youth labour law. Unions and student groups have so far staged two weeks of protests against the CPE (First Job Contract). Last week, violence erupted in several cities across France as thousands protested against the law. Police made around 420 arrests during the protests. Dozens of youth smashed windows, looted shops, set fire to cars and hurled stones at the police.

"Interior ministers from the European Union's six biggest countries are considering introducing an `integration contract' for immigrants."

And, recently, in Brussels, European Union leaders held their annual attempt at pumping life into the EU economy — trying to make it the most competitive in the world by 2010. The two-day meeting was overshadowed by a protectionism row.

Trumpeting economic patriotism

Yes, "protectionism" has emerged the hot topic in Europe. Economic patriotism is the new trumpet! Some 400 years ago, Europe was the inventive source of globalisation. Today, Europeans view globalisation as a threat rather than as an opportunity. The real danger Europe faces today is "stagnation."

Europe is not succeeding because of its inability to profit from change. Technology is important, but European society is losing just as much from its closed immigration policies and the rush of government interference in the economy. Europe seems to have lost its sense of vision and responsibility.

The key aspect in ensuring that a pragmatic and responsible Europe develops is "attitude" and leadership."

Right now there seems to be a shortage of both to lead Europe out of its geographical borders and obsession with maintaining rigid structures.

Important lessons

This year we are celebrating the 15th anniversary of a historic cataclysm. The years 1989 to 1991 changed the world eternally. Many of the implications remain tacit. But one thing is clear — nothing is as before.

What are the new relationships? Can institutions, people and nations adapt? What are the correct responses from governments? These are important questions.

Here is a list of lessons I believe are important for Europe's future.

The dilemmas of change: In the midst of the mystification of the past 15 years, there has been one invariable — rapid and far-reaching change. Not all of the change has been upbeat, but whether good or bad, it has been impossible to stop.

In India, we are dealing with change, every moment of our life. We are taking "change" by its horn. Europe can learn from us.

Plain answers seldom work: Fascism and communism were a direct result of misguided efforts to keep change under control. Simple answers never work.

Those who tried to ignore or block change usually are weakened or they disappear.

Those who believed strength and dominance could isolate them from the effects of change are almost always mistaken.

France is a case in point. We can see several examples of this in the corporate sector too, to confirm this axiom.

Understanding the implications of change: In this context the change that Europe ushered in the first era of globalisation — the worldwide extension of European culture through colonisation.

It is understandable that many in Europe are wary of this new and even more dramatic wave of change now breaking all over.

Three major revolutions are hitting at the same time — the Eastward expansion of Europe and its impact; the rapid aging of the population, and the advent of a new technological age. While governments strain under the burdens of such change, businessmen, scientists, and young people are becoming impatient to reap the rewards. To paraphrase Darwin: "Not the strongest will survive, but the one who can adapt the best to change."

Attitude: For a positive and confident Europe the key is "attitude." Europe must embrace a modern, open approach to a much wider world.

Vision: Europe is an inspiration as much as a place.

Europeans transformed the rest of the world through enterprise, imagination and their ability to grow — qualities that will always define Europe's identity far more accurately than any mapmaker ever will.

As geography is being made almost irrelevant, at least in a number of areas, the challenge for Europe is to reap the muscle of its ideas and enterprise — and allow the structures to develop which will make these ideas a reality.

(The author is a former Europe Director of CII, and lives in Cologne, Germany. Feedback may be sent to mohan.murti@t-online.de)