HELSINKI – No to ‘Fortress Europe’ and strategic capitalism

Over the last two years, bigger EU member states, including France in particular, have shown willingness to ease regulations on state aid and by doing so defend European industrial and commercial global interests. In a small country like Finland, which has put its trust in open and fair markets, this kind of discussion is causing concern, as its EU Minister Tytti Tuppurainen said the EU is moving towards a fortress-like structure.

Squeezed between an unpredictable US and a ruthless China, the EU has started to pursue what it has termed “strategic autonomy”.

Symptomatic of this trend was the initiative of France, Germany, Italy and Poland presented to the European Commission’s Executive Vice President Margrethe Vestager, in which the four countries demanded that the EU speed up the creation of European flagship companies earlier this year.

Even in last week’s Summit, French President Emmanuel Macron said the EU has to better defend its independence and resources.

In its recent issue (FIIA 117), the Finnish Institute Of International Affairs calls actions like these the emergence of strategic capitalism.

“In contrast to the free market capitalism that has prevailed during the past decades, by resorting to geo-economic measures, governments are imposing conditions under which goods, services and technologies can be traded,” the Finnish institute wrote.

In this kind of scenario, Finland, which is an open economy that depends on exports, is feeling lonely. Even the UK, a former defender of free markets, is out of the club.

Finland wants to believe in competitiveness and does not want to take the road of customs, protectionism, state aid and subsidies, EU Minister Tytti Tuppurainen (SDP) told Helsingin Sanomat on 3 October in an interview.

The EU is moving towards a fortress-like structure where smaller economies might be in danger of being trampled on, according to Tuppurainen. This kind of sentiment is one other smaller EU member states may very well share.

(Pekka Vänttinen | EURACTIV.com)

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