While Britain’s protracted exit from the European Union grabs headlines, Brexit is far from the only issue affecting the continent. 

At a roundtable luncheon on 15 October, Carmen Cano de Lasala, Head of the European Union Office to Hong Kong and Macao, discussed the E.U.’s Global Strategy, which was launched three years ago and focuses on the bloc’s role in the world and its security policies. She shared some of the challenges of implementing this strategy amid external pressures including the U.S.-China trade war, climate change, terrorism and migration. 

Even in the past three years the global environment has changed a great deal. The E.U. is now dealing with a more assertive China, which is a partner to the E.U. but increasingly a competitor as well. 

There is also a disengaged United States, part of a trend to undermine the world’s multilateral institutions. The E.U. supports multilateralism, Cano de Lasala said, and while the institutions are not perfect, to ignore them is to go back to the “laws of the forest.” 

“I would emphasise the importance of unity,” she said. “Because in this very complex world, where we need to deal with complicated partners, we have discovered that we are stronger together.”

Humanitarian work is an important aspect of the Global Strategy, including addressing the causes of migration through promoting growth in Africa. Operation Sophia in the Mediterranean has saved more than half a million people, Cano de Lasala added. Improved security efforts include PESCO (Permanent Structured Cooperation), a new project among 25 member states to streamline their defence capabilities. 

Looking to Asia, Cano de Lasala noted that the E.U. was cooperating with ASEAN, as well as working to improve connectivity in China and across Asia. 

She said that the E.U. shares the concerns of the U.S. about China when it comes to intellectual property and the lack of a level playing field for overseas companies. However, she said that the trade tensions have been detrimental to global growth, and emphasized the importance of negotiation to find the best solutions.

On the unrest in Hong Kong, Cano de Lasala noted that the E.U. has been outspoken since the beginning. “We expressed our concern regarding the amendments to the fugitive ordinance. After that, we have been extremely clear rejecting violence and asking for de-escalation, and calling for dialogue as the only solution to solve the crisis in Hong Kong.”

This focus on negotiation is one of the key values of the E.U. and underpins all of its policies, Cano de Lasala said. “We believe dialogue is the best way to solve differences, and that is what we are trying to promote in Asia.”

Dr Alicia Garcia-Herrero, Chief Economist for Asia Pacific at Natixis, also spoke at the event and struck a mildly positive tone. “We are at a time when the world is not doing well, but Europe is doing slightly better,” she said.

Trade in goods in the E.U. has slumped, partly as a result of the U.S.-China trade war, but also because of the problems in U.K., the bloc’s third largest trading partner. The trade tensions may create limited opportunities for European manufacturers in sectors including transporters, aircraft or furniture. “We have some room to benefit, but we do not have the same production capacity as China or the U.S.,” she explained.

There was good news in areas including employment, wage growth, domestic consumption and productivity levels.  

“Europe continues to be quite productive,” Garcia-Herrero said. “Labour productivity in the E.U. is higher than the U.S. and Japan.” However, there are stark differences among the bloc’s member states, with some “black spots” of low productivity.

While Brexit was not the focus of the roundtable, the subject remained impossible to avoid. Consumer confidence in the U.K. has collapsed, and business investment in the country has been flat since 2016. By comparison, the rest of Europe enjoyed strong investment growth in the same time period. 

Another delay for Brexit seemed likely at the time of the event. “But we can’t do this many more times,” Garcia-Herrero concluded.