EEAG Report 2018: Europe: What now, with whom, where to – The Future of the EU

This year’s EEAG/EconPol Europe report focuses on the causes and symptoms of, and possible cures to the current integration malaise of the European Union. A decade of economic and migration crises and Brexit represent a major stumbling block on the path towards ever closer ties and continuous enlargement. The report raises the fundamental question of what holds societies together and shows that interaction within and between nation-states is strongly shaped by trust. Trust enables economic, social, and political interactions both within countries and internationally.

Although convergence is one of the EU’s key political objectives, the report reveals significant divergence in economic outcomes like income levels and indicators of institutional quality both before and after the global financial and euro area debt crises. Inequality has also increased within some countries, eroding trust in the ability of national governments to provide social protection. The perceived distributional impact of economic integration also tends to undermine trust in European institutions.

A founding principle of the European Union is that all member states and citizens should participate equally in a single process of ever closer integration. The euro crisis, Brexit, and global geo-political trends now make it interesting to revisit the issue of whether European states should be able to subscribe to only some of the rights and obligations of membership. The report reviews these and other issues in the light of experience and of the insights and analogies afforded by viewing the European Union, and possible sub-entities within it, as ‘clubs’ of countries.

As usual, there is also an in-depth macroeconomic analysis for the EU and other countries around the world, together with an economic forecast for the year ahead.

The report will be presented at press events in Brussels and in selected cities across Europe.