From Asia to Europe: A Game of Balance – Nikos-Pavlos Kotzias, Greece


Shanghai’s skyline has changed dramatically over the past few years as a result of the Asian Economy Boom in the late 90s, Source: Businessinsider

Living in a country that has experienced one of the heaviest blows of both the refugee and the economical crisis and is often dubbed the “Gateway to Europe,” I find myself overwhelmed quite often by the way various situations have evolved and how modern Europe has come to be.

As numerous challenges and problems arise in Europe, some say the region is on the verge of collapse. Although I do not share these pessimistic views, I can definitely relate to the various issues that need to be addressed soon. Arguably, the EU has many intricate problems and not all can be listed or explained in a few paragraphs by a youth with almost no political knowledge – but anyways, here’s what I think.

First of all, the EU has not managed to escape the fiscal and financial crisis that has bankers, stock brokers and investors biting their nails the world over.  And things are slightly different for the average European compared to a few years ago. Unemployment levels have skyrocketed (9,1% [adjusted], according to Eurostat, which roughly translates to 22 million people) and the buying power of EU citizens has downsized significantly, with European markets stagnating, if not diminishing.

Sadly, competition is largely nonexistent, since high costs of living, lack of resources and workforce, focus on the service sector and high taxation render businesses unable to compete with their Asian or American counterparts. Interestingly, multinationals like BMW, BP and Vodafone have opted to move their factories to nations outside Europe, while still keeping their HQ on European turf, resulting in the loss of millions of possible work options for Europeans and forcing Europe to import goods that are, paradoxically, owned by Europeans.

File:Table 2 Unemployment rate, 2003-2014 (%).png

Unemployment rates in Europe are mostly on the rise with some stagnating, Source: Eurostat

There have been many scandals in which multinational corporations have exploited European law and policy to hide profits, avoid taxation, and shield themselves from lawsuits – all in the coverage of the EU, which sure loves its multinationals. Actually, tax avoidance is not illegal if done correctly and these colossi have the know-how and the global reach to do it (for example, businesses like Starbucks and Siemens).

And that is really the problem: Europe is losing money that could otherwise be spent on social policies or other investments and not much can be done to stop it, since there are many tax havens within Europe, notably Ireland and Switzerland (however, these countries are not part of the EU).  These countries get a tiny bit of profit by providing shelter to multinationals who do not wish to pay high European taxes. Actually, no one knows how these companies will be attracted back and pay what they should, which is worse. Many say that Europe is losing its self-sustainability, global reach and political influence.

Parallel to that, Asian multinationals have found fertile soil to expand their operation, with Huawei, Lenovo and Toyota expanding their share in European markets dramatically. Over the last 10 years China’s GDP has increased by almost 400%, Pakistan 103%, India 300%, and Thailand 90%. By comparison, EU’s GDP has increased by only 35-40% (mainly in Eastern Europe). So, although it’s difficult to speak for other European countries, I can give plenty of examples for my own.

Notably, COSCO, the Chinese shipping giant, has decided to expand to Europe with the first step being the container port of Piraeus, Athens by buying 63% of its shares for a mere €350-490 million  (difference is a result of the many parts of the agreement), while also wishing to buy the passenger section of the port, as it is the busiest in Europe with 18 million passengers annually. Although the buy-out was a breath of fresh air for Greece and for the almost 1200 employees who enjoy a relatively stable job with a decent salary, it seems as if China is here to stay, with plans to privatize other sectors, such as railroads, telecommunications, and transport.

Part of the Port of Piraeus with a COSCO container ship, source:

The passenger section of the port of Piraeus is one of the busiest in Europe and the world, Source: Piraeus Port Authority

And the thing is, Asians are good at what they are doing. Their investments have paid off instantly. They have increased demand and movement of goods, they are a stable source of income for the State through employment and taxation and their investments are not only targeted at buy-outs, but expansion of preexisting infrastructure too. Their master plan is to eventually create a southern European port comparable to Rotterdam – and Greece was the perfect target.

With a long lasting tradition in shipping and the largest merchant fleet in the world, which operates from Asia to Africa and South America, the Chinese could not find a better trade partner. Add to that the geographical position of Greece (close to the newly expanded Suez Canal, the Mediterranean, the Balkans and the Black Sea) and you are set for success. Let us not forget the relative desperation of Greeks to find a job and the shrinkage of the net income of middle-class family. Jokingly, two titans of tradition and heritage meet again, yet this time, it feels as if one side has the upper hand in negotiations.

Of course, it is not only about Greece. Similar investments have been made by Asians in many parts of Europe and the Americas.  A good example is Vancouver (read Emily Mittertreiner’s article).  Germany, Brazil and many more are also seen as opportunities for Asian investors. Slowly, their economic advances have started to have an impact on Europe society, with many fearing that Asians will overtake Europe, turn the continent into their sandbox, and dominate the global market. It is, as they claim, “The Rundown of Asians.”  Some claim that it is totally normal and a positive change, because, quite frankly, this is how capitalism works; some are even sympathizers and believe that the Asians will be better and more reliable employers than the current “cruel” and “cold” westerners, who do not care about the struggles of being an average citizen. Both sides have their point, some quite realistic and feasible, some not – but to be honest, doing a political analysis on something so unpredictable as investments and capitalism is impossible, to say the least.

So after all, this might not be the type of issue I thought it would be. It is difficult to analyze how this new challenge will evolve over time and what will its consequences be for Europe, but in general, it is much more of a change than an issue. The influence of Europe is not fading, but much rather it has other competitive players to fight against in a wider game of politics and trade.

Hong Kong, along with Singapore, was one of the first cities to experience a sustainable economic boom in the 20th century, mainly aided by the influence of their parent-nations Source:

Of course, I am not saying that these investments are a bad thing, not only for Greece but for the EU in general; however, the small print still remains. Investments can be powerful leverage, and are a way for Asians to set foot in Europe and influence political tides. However, foreign investment from outside might be (for the first time in history), Europe’s way out of its crisis. For now, however, investments have given a temporary solution to the dead-end of European economies by keeping goods, services and capital flowing, day in and day out. This is the notion of Eurocentrism, that keeps Europe (and by extension the Western world as a whole) portrayed as the “Godfather” of the world charged with a “divine” duty to spread European culture and might.

It is an undeniable fact that other regions of the world, like Southeast Asia, Africa and South America, are experiencing rapid growth, and, as aforementioned, slowly cutting ties with their parent-nations by being less dependent on foreign aid and developing self-sustainability. That is the true revelation of the modern era; maybe global equity will be a reality soon. Although that may sound ridiculous for the average European or American, it is, at least, the direction towards which we are heading, and there is truly no reason to deny it. The idea of Africa being a developed region of the world definitely sounds strange and optimistic, but these nations have been subdued by European supremacy and imperialism long enough. Hopefully, with time the situation will improve, stability and prosperity slowly replacing poverty and exploitation of the African nations. The African Union has adopted its “2063 Agenda,” aiming towards a prosperous, stable and more democratic Africa within the next years.

The nations with the highest rates of growth are all outside the western world

I leave you with this thought: since when did Europeans get to own the world? Isn’t it high time for change? Asians and Africans should be citizens of the world, free from foreign influence that can in turn impact their lives and careers; not a lesser person or an adopted child of an ignorant European.

People are not nations, corporations, interests or borders. People are people, and they have as much right to this world as we do. But then again, it is not us who rule the world.  We can only trust that those at the top agree.

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