Geopolitics of Europe: Analyzing the Draghi Report's Impact on Europe's Future

The recently published Draghi report has outlined a series of proposals to address the pressing issues facing Europe, from military spending to climate change and geopolitical positioning.

The report highlights three major challenges for Europe: accelerating innovation, reducing energy prices while decarbonizing, and responding to a more unstable world where Europe can no longer rely on others for security.

One of the key concerns raised in the report is the defense industry's inability to keep pace with the increase in military spending. It reveals that 78% of European armies' equipment is acquired outside the Union, with only 18% of orders being placed in a coordinated manner in Europe.

To address this issue, the report suggests strengthening Europe's autonomy in digital and renewable energy domains, upholding Europe's social model, and increasing investment in Europe. It also emphasizes the need for greater engagement abroad to limit climate change and prevent China and Russia from dominating the "Global South".

The European Defense Agency, an institution that already exists, could play a significant role in developing more military research projects, encouraging firms to group together, and coordinating European armies' equipment purchases more effectively.

Another critical aspect addressed in the report is Europe's response to the growing influence of China in Africa and Latin America through initiatives like the "Belt and Road Initiative". The report proposes the Global Gateway initiative, but acknowledges that the additional funds mobilized remain limited.

To catch up on Europe's technological lag, an additional 800 billion euros of investment per year is needed from both private and public funds, equivalent to 5% of European GDP. This investment is crucial for Europe to develop economic ties with other regions of the world for access to critical raw materials needed for the energy and digital transitions.

The report also emphasizes the need for Europe to develop a genuine "economic foreign policy" and to coordinate preferential trade agreements, direct investments, and resource security. Balanced partnerships with partners should be established to help them build genuine industrial value chains.

However, the report warns that the most important aspect of the Green Deal is not happening in Europe, but in emerging and developing countries. These countries will only fully commit to the green transition and climate change adaptation if developed countries provide sufficient assistance.

The report further proposes greater integration in key areas such as taxation, foreign policy, and defense to finance the Union's budget and support its debt emissions. However, the European countries that have shown the strongest resistance to the proposal of joint debt issuance for massive investment efforts include Germany, the Netherlands, Austria, and Finland.

The report concludes by calling for a thorough debate on the many proposals it contains to identify the most urgent ones and the way they can be effectively implemented. It also warns that the pendulum should not swing too far in one direction, alienating partners with whom the EU would instead need to strengthen ties.

The Paris Agreement process is at risk due to insufficient funding for global climate change financing from Europe. Many countries in the South, particularly in sub-Saharan Africa, are facing serious debt problems due to COVID-19 and the war in Ukraine, and Europe cannot refuse to contribute to solving it. The report warns that if no agreement is reached on increasing public funds or issuing joint debt, there is a risk that this major internal investment effort will come at the expense of public and private European investment outside the Union, which would ultimately degrade Europe's geopolitical position.

In conclusion, the Draghi report presents a comprehensive and ambitious plan to address Europe's challenges, from military spending to climate change and geopolitical positioning. The success of this plan will depend on the willingness of European leaders to collaborate and invest in a coordinated manner.