Western democracies will be further challenged next year, as populist parties are expected to make gains in Europe, while China and Russia increasingly set the global agenda, taking advantage of a US withdrawal.
When the Soviet Union collapsed in 1991, American political scientist Francis Fukuyama famously proclaimed the “end of history”, seeing the triumph of the United States as the only remaining superpower and the leader of Western democracies.
“The end point of mankind’s ideological evolution and the universalisation of Western liberal democracy (is) the final form of human government,” he wrote in his best-selling 1992 book, The End of History and the Last Man.
Twenty-five years later, Fukuyama’s certainties have all but vanished. Liberal democracy in Europe and the United States is in crisis, while China and Russia demonstrate that authoritarian regimes are increasingly determining global priorities.
In Europe, the digestion of half a dozen electoral processes – including in France and Germany, the EU’s two largest economies – will delay any hope of renewed leadership until at least the autumn.
“Never before have I seen national governments so weakened by the forces of populism and paralysed by the risk of defeat in the next elections,” lamented European Commission President Jean-Claude Juncker during his State of the EU address in September.
And the new US government is not expected to balance Europe’s absence from the international scene. On the contrary, Donald Trump, who takes over the White House on 20 January, has shown no sign of toning down his populist rhetoric, as he prepares to disengage America from the world stage.
The political vacuum will be filled by China, which aspires to become a global superpower not only in economic matters. After being left on the roadside of the first industrial revolution in the 19th century, the Asian country is now eyeing the fourth industrial revolution to claim its long-sought crown.
To that end, Bejing is in the midst of a charm offensive and is presenting China as the champion of globalisation and multilateralism. President Xi Jinping is expected to showcase his “new starting point” during the World Economic Forum in Davos in January. It will be the first time a Chinese president attends the elite summit.
Europe: The return of populism
European leaders that will go to Davos will have a different concern: elections.
The three leading eurozone economies will hold elections next year. Germany in September, France in April and May, and Italy most likely in June. The first country to vote will be the Netherlands in March. Greek Prime Minister Alexis Tsipras could also be forced to call for snap elections, due to problems with the bailout program.
Guntram Wolff, director of the Bruegel think tank in Brussels, believes that “it will be difficult to have any negotiations about anything” next year given this intense electoral cycle, at least until next autumn.
These elections will not only paralyse the legislative agenda of half of Europe and the EU institutions. It will also risk releasing some of the continent’s most feared historic demons.
Right-wing populism has grown over the last few years, fuelled by social unrest provoked by the ongoing recession, terrorism, and xenophobia triggered by a massive influx of refugees and migrants from the war-torn Middle East, and Africa.
“Either we demonstrate that we are able to defend our interests, or the political winners will again be the populists and isolationists,” warned European Council President Donald Tusk last October.
According to opinion polls, the captain of this intolerant, anti-EU, pan-European front, Marine Le Pen, is just a few points away from being elected France’s president.
The Islamophobic leader of the Netherlands’s Partij voor de Vrijheid (PVV), Geert Wilders, could win the elections, but he would be incapable of forging a governing coalition.
The anti-establishment party led by Beppe Grillo (Movimento Cinque Stelle) also has a real opportunity of defeating Italy’s mainstream parties.
And the retro-nationalist Alternative für Deutschland could win a considerable number of seats in the German Bundestag, facing a weak governing coalition just when Europe is facing its most critical moment.
Against this backdrop, the EU will celebrate the sixtieth anniversary of the founding Treaty of Rome.
European leaders hope the Rome event can serve as a turning point to regain the upper hand, after almost a decade of crises which culminated in June with the British vote to leave the Union.
In March, they will cerebrate this anniversary with a document that will encapsulate the vision for the future of the European project.
Juncker does not want to call for a ‘United States of Europe’, said one of his aides, trying to reassure the most Eurosceptic voices wary of the president’s federalist drive.
The document is expected to follow the recommendations of the Five Presidents’ Report to complete the economic and monetary union, by setting up a real fiscal union and, ultimately, a political union.
But even if the new roadmap spells out specific deadlines and beefs up the blueprint unveiled last year, nobody expects any progress during 2017.
The reasons are not only the numerous elections but also the difficult divorce talks with the UK.
Brexit negotiations will be launched in March, once British Prime Minister Theresa May triggers Article 50.
In order to navigate this rough patch, EU leaders lowered their ambitions for next year and agreed on a common agenda to bring concrete results in few areas where consensus exists.
For EU decision-makers, the main challenges derive from “the perceived lack of control and fears related to migration, terrorism, and economic and social insecurity”, reads the Bratislava summit’s conclusions. “We need to tackle these issues as a matter of priority over the coming months”, the statement emphasised.
This agenda aims at regaining citizens’ trust, reconquering some ‘commonality’ among the remaining 27 EU members and reasserting control after years of intense crisis management.
A weak G7
Italy will play a leading role in the institutional setting next year.
The Mediterranean country has been heavily affected by the refugee crisis and the eurozone banking crisis has reared its head recently. Former Prime Minister Matteo Renzi was forced to resign after losing a referendum, partly because of the influence of Cinque Stelle, and the country will host the Treaty of Rome celebrations and also the G7 summit.
The gathering of those powerful states will illustrate the significant changes that have occurred in the world order over the last few years.
Neither Russia nor China are invited to the summit, which is to be held in Sicily, despite their growing influence in the Middle East and South-East Asia.
Another big question is how Donald Trump will govern once he takes office on 20 January. His unpredictable behaviour and idiosyncratic, hard-right cabinet appointments could trigger some serious surprises in 2017.
Internal instability and external chaos. Europe intends to protect itself from a perfect storm by praying to the goddess of liberal democracy, blessed by Fukuyama, to remain as it stands today. Contrary to the erroneous prediction of the American thinker, history remains very much alive, but it is not necessarily moving forward.