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In his interview to the Institut Montaigne, Geoffroy Roux de Bézieux, honorary president of the Movement of the Enterprises of France (MEDEF) and of the Alliance of Francophone Employers (APF), argues that the European Union’s economic security issue can only be addressed by big nations relying on national sovereignty. Here are the main messages from that interview.
‘Economic security is national security’. This epigraph, attributed to Donald Trump, precedes the second pillar, entitled Promote American Prosperity, of the 2017 U.S. National Security Strategy.
Destabilization between States was thought to be a thing of the past after giving way to ‘happy globalization’. But it is now coming back in force. Today we witness not only State-on-State operations, but also destabilizing operations conducted via proxies, some of which do not always act consciously (some NGOs or companies can be manipulated by hostile States eager to politicize certain issues). State capitalism is also a lever of pressure, for example in the United States, where, contrary to its traditionally liberal policy, direct public ownership of companies is gaining ground.
In Europe there is a Commissioner for Trade and Economic Security, and some aspects of economic security, such as trade policy or economic sanctions, are exclusive competences of the European Commission. But the economic security functions (national security, economic intelligence, etc.) are mostly national.
Most aspects of economic security are shared competences – such as control of foreign investments, governed by the Regulation on the Screening of Foreign Direct Investment. The Regulation authorizes the Commission to issue an opinion in the event of an investment affecting the security of more than one member State. The screening of foreign direct investment is now mandatory in certain strategic areas (dual-use goods and military equipment, ‘hypercritical’ technology, critical raw materials, critical entities in energy, transport and digital infrastructure, and electoral infrastructure).
The EU is thus an essential level of economic security. But this cannot alter the reality: even if it is desirable to work together, e.g. by establishing common policies towards certain American or Chinese investments, European countries and their companies still compete with each other, and their interests differ. In Europe, various States compete to host a particular production site or factory that they hope will revive their local labor market.
Moreover, not all countries are at the same level of economic intelligence culture. This has been a long-standing practice in some countries, including France or the United Kingdom, but it is not the rule.
It is easy to understand why: the very notion of economic security makes little sense in a country of two million people, where companies cannot rely on their domestic market, where economic sovereignty is of little relevance and where there are fewer major industrial and technological players. Economic security becomes a crucial topic above a certain threshold of population and wealth. It can be addressed at the European level but not among all the 27 member States: only among ‘big nations’.
Economic security is thus a reminder of the overriding strength of our national sovereignty, even though it can be approached in a multi-faceted and concerted fashion.