Europe Weighs Eurobonds Amid Growing Geopolitical and Economic Uncertainty

European leaders recently gathered at an informal summit emphasizing the continent's strategic response to rising geopolitical and economic challenges posed by the United States and China. French President Emmanuel Macron has reignited the call for eurobonds—a collective European debt instrument designed to finance large-scale strategic investments required for defense, technological competitiveness, and ecological transition. Currently, each EU member state manages its national debt, limiting investment capacity, especially among heavily indebted countries. Eurobonds could enhance the euro's global role by attracting investors through joint borrowing, potentially generating up to €1.2 trillion annually for crucial sectors.

Despite demonstrating feasibility with the €750 billion COVID-19 recovery plan, eurobonds face resistance mainly from Germany and "frugal" states fearing fiscal laxity. This debate reflects broader questions about the EU's unity and ability to act as a global power. Meanwhile, the French Institute of International Relations (Ifri) highlighted ongoing concerns about Europe's limited influence over future geopolitical scenarios. According to expert André Sapir, three possible futures emerge by 2030-2035: a chaotic multipolar world, a return to Cold War-like blocs led by China and the US, or an optimistic revival of multilateralism driven by global demand for regulation. Sapir noted that the superpowers will primarily dictate the course, posing challenges for Europe's strategic positioning.

Moreover, geopolitician Thomas Gomart criticized the inadequate and simplistic geopolitical advice offered to businesses, underscoring the need for a sophisticated understanding amid complex global dynamics. The convergence of strategic economic proposals like eurobonds and nuanced geopolitical analyses illustrates Europe's efforts to bolster resilience and maintain relevance in a turbulent global order.