Four EU scenarios for governance in a post Covid-19 world

Scarcity of medical equipment during the COVID-19 crisis, and the ensuing discussion on ‘reshoring’ certain industries back to Europe, have brought back an old dilemma. Namely, countries wish to be strategically independent while depending on products and resources from other countries to fulfil their economic needs. This reflects the debate about whether markets or governments are better at delivering solutions. We can also define this debate as a choice between ‘competitive capitalism’ and ‘strategic ...

Scarcity of medical equipment during the COVID-19 crisis, and the ensuing discussion on ‘reshoring’ certain industries back to Europe, have brought back an old dilemma. Namely, countries wish to be strategically independent while depending on products and resources from other countries to fulfil their economic needs. This reflects the debate about whether markets or governments are better at delivering solutions. We can also define this debate as a choice between ‘competitive capitalism’ and ‘strategic autonomy’. Calls for strategic autonomy have increased since the COVID-19 crisis, at national and EU level. However, strategic autonomy conflicts with the achievements of international cooperative governance. This introduces another dilemma: the choice between interests and values. Pursuing interests alone leads to a vicious cycle of increased competition between markets and between states, ultimately deteriorating into imperialism. Developing value-oriented actions at government and market level can break that vicious cycle. Value-oriented concepts already form part of many EU policies, which place substantial emphasis on environmental and social rights. When ethical values become an integral part of business and government decisions, this is called ‘due diligence’. We can define value-oriented international cooperation between governments as ‘cooperative governance’. Similarly, we can define ethical and value oriented action by private actors — whether NGOs or businesses — as ‘ethical capitalism’. Putting the two dichotomies on a grid creates a model of four possible scenarios for action which can aid our understanding of ongoing discussions on governance in a post COVID-19 world. EU policy makers could also use these scenarios as alternative ways of shaping EU and foreign policy. The management of natural resources, ranging from water, land, forests, energy resources and metals to rare earths, shows a counter-clockwise development through the scenarios. Moving away from unregulated markets, extraction and use were gradually regulated by national governments, who competed against each other in an imperialist setting. The transnational nature of economic and environmental problems has increasingly brought them into the scope of international cooperative governance. Ethical capitalism (changing market forces from within) is a relatively new development complementing government action. Progress through the scenarios is not always sequential: actors face pressures to switch between them. We can draw lessons for governance in a post COVID-19 world from the experiences of natural resources management. This study is the first on ´global trends in external policies´, aiming to develop forward-looking and strategic analyses.