A strategic scenario analysis
It’s 2016. The unthinkable has happened – the UK is no longer part of the European Union. What form will the relationship with the UK take? How will the EU develop? And what opportunities and challenges will emerge for German companies from this new setting? Let’s look into the future and ask some business leaders for their personal experiences. Here are four possible status reports from the year 2025.
What are plausible scenarios for the future?
Scenario 1: All back to square one
The countries in Europe agree on the lowest common denominator: free trade. A world without the euro but at least with a common customs union. German industry is suffering under standards and guidelines dictated by the major economic areas: the USA and China.
Scenario 2: The European Federation
In the absence of the blocker, the UK, the process of European integration is back on track. The Single Market remains intact and rapidly concluded agreements regulate free trade with the UK; companies are benefiting from the first successes of the structural reforms under the southern countries’ austerity policies and the increasing purchasing power in the EU.
Scenario 3: Fortress Europe
With the departure of the UK, a strong voice for a European policy of austerity was lost – in the European core countries, the advocates of an internal transfer union and external protectionism gained the upper hand. Exporting nations are suffering from protective tariffs in the UK; companies are afraid of high costs in Germany.
Scenario 4: Shattered dreams
The project of European integration has failed and the nation state has made a comeback. London, Paris and Berlin are focusing on bilateral agreements with the largest economic areas, albeit from weakened foreign policy positions. Multinational companies are suffering under the political instability.
Whatever it looks like – the future is yours to manage!