European Union 'empire should be disbanded' says expert
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Despite a health catastrophe and one of the worst economic downturns in modern history, the number of startups grew in the US last year. According to a report by the Peterson Institute for International Economics, from 3.5 million in 2019, startups grew to 4.4 million in 2020, a 24 percent increase. The number of new businesses also increased in Chile, Turkey, and the UK.
Other economies, though, particularly the ones in the EU, were not so vibrant.
In Germany they fell by 11 percent.
In a recent report titled ‘If the EU fails, this is how’, the head of Oxford-based think-tank Euro Intelligence Wolfgang Munchau insisted that while no one statistic ever tells a complete story, this one comes a long way.
Mr Munchau argued the EU still lives in the past.
He explained: “When we discuss European politics, we talk about EU governance, fiscal and monetary policy, immigration and EU enlargement.
“What Europe’s multiple crises have in common is that they are driven to a large extent by a lack of innovation, and the resulting lack of productivity growth.
“Stagnant societies close themselves off to change.
“They oppose integration and open immigration policies.”
My Munchau noted lack of innovation and over-reliance on old technology are the reasons why German foreign policy is trapped in “neo-mercantilism”.
He wrote: “If your current account surplus accounts for 8 percent of GDP, what else can you do?
“You have insufficient degrees of freedom left to pursue other political goals.”
He concluded in his report: “As of now, the EU is still living in an extended 20th century, led by 20th century political figures like Angela Merkel, and Ursula von der Leyen.
“Politicians cannot on their own produce creative destruction, but they can set conditions for it to flourish.
“They have not done so.
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“The EU is an entrepreneurial wasteland. Ireland and the Netherlands are business-friendly, in the sense that they have loopholes for large American corporations. But unlike the US itself, neither is particularly friendly towards young entrepreneurs.
“If European integration fails, this is why and how. It won’t be because of Viktor Orbán, or austerity, or policy errors committed by central bankers.
“It will be because Europe continues to live in the past.”
According to a report by POLITICO, European startups are raising more money at an unprecedented pace.
However, Brussels’ unrelenting focus on taming US Big Tech, coupled with European entrepreneurs’ own lack of experience in Brussels, could leave Europe’s startups adrift.
Experts say the focus on reining in the excesses of the biggest, mostly American, companies is taking away from the good that policymakers and regulators can do for Europe’s own industry.
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Mariya Gabriel, the commissioner for innovation and a fierce startup supporter, called for an end to Europe’s “fixation” with Silicon Valley.
She told POLITICO: “The quest to create a European Google is lost.
“We don’t have to lose time because we won’t create a European Google or Facebook.
“Let’s be very realistic about that.”
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