Home
Articles
Europe’s Dilemma: Values vs Interests and Protectionism vs Leadership

For decades European development has been guided by a number of key values: human rights, democracy, freedom of thought and belief (and of the press), free trade, the rule of law, laicism (in most countries), and multiculturalism.

Generations have been raised in an environment promoting these values. And these values have been central to helping Europe achieve historically unprecedented prosperity and stability. Yet Europe now faces a number of serious risks for the future: an ageing population, eroding competitiveness, limited military credibility, and limited access to key natural resources. Global institutions seem inadequate to the range of global risks facing the world, from terrorism to climate change.

The true test of values is whether they can be maintained when they run counter to short-term interests of these risks and challenges.

Already some conflict is emerging. Some key European values – such as free trade – are beginning to hurt. Globalization has the potential to make some people in Europe relatively poorer, even if it helps global growth. Will Europe continue to open its markets, and enable cross-national mergers, regardless of the nationality of new owners?

A similar question applies to transforming global institutions along universalist lines which may run counter to Europe’s interests. For example, it is difficult to defend Europe’s two vetoes in the UN Security Council when India has none. Will Europe be able to accept the limits on its voting power that would stem from embracing a more democratic governing principle for global institutions?

Ultimately, trying sustain unsustainable agricultural or high social security subsidies and to limit international M&A, or even freedom of speech will not only cause potential conflicts with some key European values, but, fail to protect Europe from the risks facing it.

Protectionist tendencies – economic or cultural – are likely to delay, and therefore raise the costs, of subsequent structural reform. Enlargement fatigue will surely cause Europe to lose momentum as a model for global governance.

Europe should adopt an offensive, not defensive, approach: continuing enlargement to export its values and systems and at the same time clearly demonstrating its commitment to these values by its actions, avoiding double standards for short-term interests.

The EU has the potential for global leadership, not by virtue of size or strength, but by being an example. However, the EU must orient itself towards improving the world in line with its own values, instead of its current self-centred, protectionist approach. Only in such a way can Europe deal with the risks it faces itself – let alone help the process of mitigating global risks.

Taking Opportunity

There is an opportunity for the EU for global leadership. Since 9/11 the world has been subjected to unilateralist policies; global sentiment has moved against the accumulation of power in a single country. There is a growing wish for an alternative approach to global leadership; one not based on power, but on values.

Building Power

But in order for the EU to exercise leadership, it also has to have sufficient power, defined in five dimensions: political, economic, sociological, technological, and military.

As a political project, the EU is an innovation where countries, without recourse to force, agree to share sovereignty. However, it has become clear that both the efficiency and legitimacy of EU decision-making needs to be improved. Both administrative systems and individual perspectives need a more global dimension to deal with future global and European risks. The EU can be a global model, but only if the efficiency of decision-making takes precedence over protection of existing power equilibrium.

The EU is the premier global economic bloc, but competitiveness must be enhanced. Can the EU’s present welfare mentality be maintained? From the point of economic development, the Lisbon goalscarry a lot of weight. Failing to reach them will pose a major threat to aspirations to global leadership.

Sociologically, much store is set in Europe by “unity in diversity”. But tolerance and understanding is too often only for current citizens; nationalism and rejection of “the other” are growing trends, as witnessed by immigration policies and attitudes to enlargement.

Technologically, there are a number of constraints. The EU has collectively made some significant advances – adopting the GSM standard or implementing common projects in the 7th Framework Program. But financing for innovation and the spirit of entrepreneurialism, remains weak.

Militarily, Europe lags well behind. Even in an era when world leadership depends less on military prowess, it is vital to share more significant military responsibility in conflict regions of the world. The EU itself is a successful peace project and should focus on exporting this idea.

Creating Vision

In addition to opportunity and power, leadership demands vision. One very important message should be conveyed to Europe’s people: Europe should not be about protecting interests, but creating a structure by which European values become a global norm.

And this requires consistency between words and deeds in all EU actions. “European” values as democracy, human rights, rule of law, multiculturalism, protection of minorities, and laicism have to be applied consistently to gain the trust of global citizens. Defence of self-interest, alienation of “the other”, fears over migration, worries over innovations such as GM foods, and protection of low working hours will not allow the EU to maintain its existing prosperity, let alone attain global leadership to deal with global risks.

A True Test of Values: Approach to Membership of Turkiye

To the surprise of many, after forty years of courting, Turkiye successfully completed many reforms and secured negotiations for accession to the European Union. However, the recent developments in the negotiations is failing to create an impression of mutually trusting future partners, but one of European reluctance to accept Turkiye as an equal partner.

Unless this changes significantly, it will be difficult to proceed on a win-win basis. This process will turn into one side establishing ever changing goal-posts and the other feeling alienated.

Yet Europe and Turkiye have a historical opportunity to throw out the prejudices of ages, discredit the “clash of civilizations”, and establish a stronger EU. Turkish membership presents the potential to mitigate some of the key risks for Europe, and help the EU to be a role model for global governance.

While the European population is aging, Turkiye is entering a “golden demographic period” similar to what East Asia experienced in the 1980s. The continuation of reforms in Turkiye will not only increase investments in Turkiye, but make Turkiye indispensable. In contrast to European worries about inflows of migrants, Turkiye, with her renowned hospitality, quality of medical care and pleasant climate, may become “Europe’s Florida”, in terms of attracting and caring for European retirees.   While immigration of Turkish people will be limited, immigration of jobs will make up for Europe’s declining population. Automotive production has started to move to Turkiye – where the most profitable Ford and Fiat plants are located.

Only a few emerging markets in the world have the potential to be able to create a “virtuous investment cycle” of exports and domestic demand. This is true not only for products, but also for young managers. Young Turks are being employed by global firms throughout the world. The Chairman of Pfizer said recently that their most important export from Turkiye was qualified managers.

Overcoming regional political risks can only be achieved if economic development spreads.  And throughout the region, Turkiye is likely to be an engine of growth.  As one observer put it, “Turkiye will be the ‘viagra’ for Europe” by becoming the key agent to help improve European and regional competitiveness.

A win-win approach on Turkiye will be the key to addressing European risks, and making the EU a values-based global leader. Managing Turkiye’s relationship with Europe relies on navigating the (sometimes false) dilemma in the title of this essay.

Good governance requires wisdom. Sufist philosophy, which has an important place in Anatolian tradition, gives important advice. This philosophy, based on “tolerance” and “harmony”, defines good governance as self-management. Good governance is to free ourselves from our fears, opening our eyes and hearts to new perspectives, to “regard others, as we regard ourselves.” Individuals, civil society, political statesmen, businessmen and managers of international organizations have critical roles in accomplishing that goal.

Dr. Argüden
yarguden@arge.com


World Economic Forum
December 18, 2006
From Global Crisis to Global Governance
The mortgage crises that started in the US in 2008 soon turned into a global crisis....
The Global Citizens’ Initiative
February 11, 2018
Responsible Boards – Action Plan for a Sustainable Future
A sustainable global economy is one that combines long-term profitability with ethical behavior, social justice, and...
IFC Private Sector Opinion
March 1, 2015
Right Reward for Right Performance
Aligning Executive Compensation with Good Governance Dr. Yılmaz Argüden1 “Price is what you pay. Value is...
International Journal of Disclosure & Governance
April 1, 2013
Is More Regulation the Right Recipe for Better Governance
Increasing regulation of corporate governance is becoming a new trend in many jurisdictions. Yet good governance...
October 2, 2012
Rio+20 was a Bust
World leaders from government, the business world, NGOs and academia gathered at the UN’s Rio+20 summit....
The Globalist
July 11, 2012
Why Boards Need More Women
Diversity on boards is critical to sustaining performance. Broadening the composition of the board increases the...
Harvard Business Review Blog
June 7, 2012
Global Boards Help Make Companies Global
For organizations to endure, they must strike a balance between risks and rewards, short-term objectives and...
Harvard Business Review Blog
November 9, 2011
Attitude is everything: The case for Turkiye
Recent local elections have been a wake up call for numerous European leaders such as Angela...
INSEAD Knowledge
April 28, 2011
Diversity at the Head Table
Click here to download as PDF.
October 25, 2010
Measuring the Effectiveness of Corporate Governance
Trust is the foundation of sustainable development. As the world continues to get smaller, our mutual...
INSEAD Knowledge
April 15, 2010
ARGE Corporate Governance Model©
Click here to download as PDF.
March 15, 2010
Consensual Delegation of Sovereignty
Thanks to changes in IMF voting, countries such as China, Mexico and Turkey now have a...
The Globalist
November 18, 2009
The Power of Inclusion
Editor’s note: When US President Barack Obama landed in Ankara on Monday, April 6, 2009, it...
Harvard Business Review Editors' Blog
April 9, 2009
From Global Crises to Global Governance
In a perspective from Turkiye, top business strategist and civic leader Yilmaz Argüden explores how global...
March 28, 2009
Opportunity from Crisis: Obama’s Chance for Real Global Leadership
In a perspective from Turkiye, top business strategist and civic leader Yilmaz Argüden argues that Barack...
The Globalist
February 20, 2009
Europe’s Dilemma: Values vs Interests and Protectionism vs Leadership
For decades European development has been guided by a number of key values: human rights, democracy,...
World Economic Forum
December 18, 2006
Legislating History
Recently various Parliaments throughout the world started to get in the business of legislating history!! Generally...
October 24, 2006
US – Turkish Cooperation Based on Shared Values
Since 9/11, the US unilateralism has been widely interpreted as a projection of hard power to...
September 5, 2005
Shaping The Future
The choices we make today shape not only the current results, but also the future. However,...
Dünya Gazetesi
March 2, 2005
Water and Global Governance
The 5th World Water Forum has convened in Istanbul. Water is life. Everywhere and every day we need it. Water...
Global Compact
March 1, 2005
The Missing Political Debate
The US presidential elections have profound implications not just for the US, but also for the...
April 6, 2004
Lead Indicators
Managers usually make their decisions based on metrics, which can easily be measured and has an...
January 21, 2004
Family Businesses
Happy families are all alike, but each unhappy family has reasons of its own. Leo Tolstoy...
July 10, 2000
European Union and Turkiye in 2020
“The future belongs to those who believe in the beauty of their dreams.” Eleanor Roosevelt Let...
July 3, 2000
Civil Society in Support of University
“Only the educated are free” Epictetus That the importance of education increases further everyday is beyond...
June 17, 2000
Democratization of Capital
“You cannot escape the responsibility of tomorrow by escaping today.” Abraham Lincoln In today’s world only...
June 17, 2000
Second Career
“Life consists not in holding good cards but in playing those you hold well.” Joel Billings...
June 17, 2000
Center of Attraction
“It is not in the stars to hold our destiny, but in ourselves.” William Shakespeare To...
June 5, 2000
Going Beyond the Borders
“The shell must break before the bird can fly.” Lord Alfred Tennyson The greatest obstacle to...
May 30, 2000
Galatasaray and Education of a Nation
“Winning is not everything, but the will to win is everthing.” Vince Lombardi Education of a...
May 23, 2000
Corporate Governance
“The best way to create trust in an organization is to open all doors – from...
May 17, 2000
Those Who Fail to Share, Will Be Shared Out
“Dünyada görmek istediğin değişimi, önce kendinde gerçekleştirmelisin.” Mahatma Gandhi Unprecedent improvements in information and communication technologies,...
April 24, 2000
Representative Democracy to Participatory Democracy
“A journey of a thousand miles begins with a single step.” Confucius Decisions that are not...
April 17, 2000
Reform in Patent Legislation
“Change starts when someone sees the next step.” William Drayton Developed countries are adamant about extending...
April 9, 2000
Leaders Magazine Interview
LEADERS Magazine Interview Questions for: Dr. Yılmaz Argüden Chairman ARGE Consulting, Istanbul Senior Advisor and Representative...
January 1, 2000
Managing Diversity
Ladies and Gentlemen, It is a great pleasure and honor for me to address you to...
January 1, 2000
World Leadership by Example: Challenge for EU
The potential of EU for the leadership of the world was the subject of the largest...
January 1, 2000
Education for Sustainable Global Governance
Vision: The world will be a more stable and innovative place to live for the human...
January 1, 2000
Global Fault Line
Humanity’s search for truth and curiosity to reach further locations have been an ever lasting ambition....
January 1, 2000
Turkish-American relations and TAİK
Turkish-U.S. Business Council (TAİK) Chairman Dr. Yılmaz Argüden answered our questions concerning Turkish-American relations and the...
January 1, 2000
Global NATO
The most important role of government is to provide security and maintain stability. Significant changes occurred...
January 1, 2000