Celebrating the decline of Europe

The much talked about decline of Europe was thus about a relative decline, says Pallavi Aiyar.

It wasn't long before I realised that moving from Beijing to Brussels entailed more than a switch from chopsticks to chocolate. At heart it was a move from an energetic story of rise to a tired one of decline.

In China, everything was on the up: the economy, the sky-scraping new buildings, nationalism, sporting prowess, even the art market.

But the corridors of power in Brussels, the headquarters of the European Union, echoed sombrely with all manner of gloomy predictions: of irrelevance, uncertainty and decline.

From the pages of news magazines to the seminar rooms of think tanks the talk was about a Europe being relegated to the margins in a G-2 world ruled by the United States and China; of a region marred by the absence of its ability to 'speak with one voice'; or of a sclerotic economy unable to respond flexibly to the demands of modern business.

Given Europe's affordable health-care, generous pensions, unemployment benefits and heated homes, all this talk of decline could understandably come off as a tad self-indulgent.

That's when I had my second epiphany.

The worrying wasn't about Europe's decline as much as about the rise of China and other parts of the world. If richer, more assertive emerging economies were commanding greater attention, then perforce, Europe was marshalling less.

The much talked about decline of Europe was thus about a relative decline.

A trio, comprising demographics, geopolitics and economics, defined this phenomenon.

In 1900 Europe accounted for a quarter of the world's population. Estimates suggest that by 2060 it could comprise just 6 per cent, a third of whom will be more than 65 years old.

In contrast China and India already make up a third of the world's population and India at least is set for what is called a demographic dividend, with the working age population expected to rise as a share of the total till 2050.

In geopolitical terms, Europe's diminishing stature has been a long-term trend marked by decolonisation, the end of the cold war and the emergence of the US as global policeman.

But in the twenty-first century the spectacular increase in China's international clout has meant even less space for Europe on world affairs, as was demonstrated in the recent climate change talks in Copenhagen.

Despite its self-declared leadership role on the issue, Europe was relegated to the sidelines as the main moves were determined by the G-2 of the US and China.

This leaves the economic realm, the one arena where the EU with its single market and 16-member eurozone has justifiably had something to boast about. Yet, the global financial crisis has hurt it more than the emerging economies of Asia.

For all this, Europe remains a status quo power, rich and privileged. And herein lies its Achilles heel. When faced with challengers with a fire in their belly and an appetite for change, Europe finds it difficult to respond appropriately. European culture has become one of protecting privilege and resisting change.

I visited Antwerp's diamond quarter on Hoveniersstraat a few months ago. In the European imagination the city's legendary diamond trade is intrinsically linked with the orthodox Jews that traditionally dominated the business. But in reality the last three decades have seen Gujarati Indians nudge the Jews out and take over up to 70 per cent of the trade.

When I sat down with Abraham Pinkusewitz who runs Pinkusewitz Diamonds, one of the few remaining Jewish businesses in Antwerp, to ask about this transformation, he was barely able to contain his anger.

"They (the Indians) succeed because business is all they have in their lives. They will work 24 hours a day if necessary. They will stay open on weekends. We (Jews) cannot work with the single-mindedness of the Indians," he said, his sunken eyes flashing.

'Work' almost seemed a term of abuse, the way Pinkusewitz spat it out.

And indeed, across Europe, the greatest privilege of all, that of less work, is the one that has the greatest popular support. Here lies much of the opposition to immigration, one solution to Europe's demographic challenges.

There is deep-seated anger at the idea of allowing in economic migrants who might work for longer hours and at less pay than the local population would themselves be willing.

While in countries like India and China what people really want is the right to work, in Europe it is the right to holiday that is sacrosanct.

Given the dynamics of the world today, it appears inevitable that some relative decline in European power will occur. It is also likely that in response the region might have to undertake some moderate reforms.

For the average European this might means a few less Saturdays off, a few more hours of work a week, and perhaps less means to consume as much as hitherto.

But does this warrant the kind of pessimism that is fashionable among Euro-analysts today? If Europe's decline is in essence a relative decline resulting from the rise of other, till now depressed parts of the world, surely this is cause to celebrate.

If Europe is no longer as economically or strategically dominant in the world because other nations have begun to climb the rocky path to greater wealth and clout, long denied to them, surely even Europeans should cheer.

If Europe's demographics necessitate an influx of immigrants so that people from around the world can participate in the region's prosperity, surely it's a reason for optimism.

If Europeans have to work a bit harder for their money, resulting in an, albeit very modest, levelling out of global inequalities, surely this is only in keeping with the values that Europe claims to espouse and wants to universalise: those of solidarity and social justice.

Perhaps it's time for those in Brussels to uncrease their furrowed brows and smile about the great benefits to humankind at large that Europe's relative decline indicates.

Pallavi Aiyar, Business Standard's Brussels correspondent, moved to Europe recently after more than six years in China