A COVID-19 test for the European Union

A COVID-19 test for the European Union

Over the past decade or so, the European Union has weathered the global financial crisis, a migrant crisis, and the rise of populist nationalism. Sure, it's taken its fair share of bumps and bruises along the way, but the idea of a largely borderless Europe united by common democratic values has survived more or less intact.

Then came the coronavirus. The global pandemic, in which Europe is now one of the two main epicentres, is a still-spiralling nightmare that could make those previous crises look benign by comparison. Here are a few different ways that COVID-19 is severely testing the 27-member bloc:

The economic crisis: Lockdowns intended to stop the virus' spread have brought economic activity to a screeching halt, and national governments are going to need to spend a lot of money to offset the impact. But some EU members can borrow those funds more easily than others. Huge debt loads and deficits in southern European countries like Italy and Spain, which have been hardest hit by the outbreak so far, make it costlier for them to borrow than more fiscally conservative Germany and other northern member states. In the aftermath of the global financial crisis, this imbalance nearly led the bloc's common currency, the Euro, to unravel.


Today, Europe has already unleashed some serious financial firepower to fight the current crisis, mainly through its central bank. But some of the other steps that may be necessary to prevent an economic collapse, like an EU bailout fund or crisis bonds, have reignited long-standing disagreements between North and South. A meeting of Eurozone finance ministers next Tuesday will be an important sign of whether Europe can pull together on the financial front.

The border crisis: In a bid to stop the spread of the virus, countries across the union have imposed border controls, some banning all entry to non-nationals. Although measures like this are technically allowed during emergencies like pandemics, they've caused huge traffic jams and disruptions to the flow of important goods. Relatedly, some member states have restricted shipping critical medical supplies with fellow EU-members, for fear that they will be needed at home.

When and under what circumstances these borders are relaxed again will be a very thorny political question, which raises concerns about whether one of the EU's great achievements — the vaunted Schengen area allowing unhindered, passport-free travel across the EU – will survive the crisis intact.

A crisis of democracy: Hungary's lurch towards "illiberal democracy" was the subject of serious hand wringing in Brussels well before the pandemic hit, but member states never took sufficient action to deter it. Now that the strongman Prime Minister Viktor Orban has used the crisis to grab nearly unlimited executive powers, Hungary has become an existential test of the EU's commitment to democracy and the rule of law. Other illiberal forces in Europe and beyond will be watching to see how Brussels and the other member states respond.

Bottom line: For now, the EU is holding together amid the biggest crisis in the continent's post-war history. But it's still early days. As the death toll and economic destruction mount, tougher tests of the EU's ability to function as a bloc, rather than a collection of states with competing interests, may be yet to come.

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Iran has vowed to avenge Sunday's attack on its Natanz nuclear facility. Tehran blames Israel, which — as in the past — has neither confirmed nor denied it was responsible. And all this happens just days after indirect talks on US plans to rejoin the 2015 Iran nuclear deal resumed in Vienna. What the Iranians do now will determine the immediate future of those negotiations, a Biden administration priority.

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Ian Bremmer's Quick Take:

Hi everybody. Ian Bremmer here. Welcome to your week and I've got your Quick Take and thought I would talk a little bit about where we are with Iran. One of the Biden administration's promises upon election was to get the Americans back into the JCPOA, the Iranian nuclear deal. As of last week, negotiations are formally restarted, and pretty quickly, in Vienna, they're not direct. The Americans and Iranians are both there, but they're being intermediated by the Europeans because they're not yet ready to show that they can talk directly to each other. That's Iran being cautious in the run-up to their presidential election coming this summer. But the movement is there. So far the talk has largely been about sequencing the Iranian government, saying that all of the sanctions need to be removed before they're willing to go back into the deal, because the Americans after all, unilaterally withdrew from a deal that the Iranians were indeed adhering to, and the inspections did confirm that.

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Ukraine is once again in a tough spot.

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Andean aftermath: Two big weekend elections in South America produced two stunning results. In Ecuador's presidential runoff, the center-right former banker Guillermo Lasso upset early frontrunner Andrés Arauz, a leftist handpicked by former president Rafael Correa. Lasso will take power amid the social and economic devastation of the pandemic and will have to reckon with the rising political power of Ecuador's indigenous population: the Pachakutik party, which focuses on environmental issues and indigenous rights, is now the second-largest party in parliament. Meanwhile, in a big surprise next door in Perú, far-left union leader Pedro Castillo tallied up the most votes in the first round of that country's highly fragmented presidential election. As of Monday evening it's not clear whom he'll face in the June runoff, but three figures are in the running as votes are counted: prominent neoliberal economist Hernando De Soto, rightwing businessman Rafael López Aliaga, and conservative Keiko Fujimori, daughter of the country's imprisoned former strongman. Meanwhile, in the congressional ballot, at least 10 parties reached the threshold to win seats, but there is no clear majority or obvious coalition in sight.

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A controversial new World Health Organization report on the origins of the coronavirus that suggests it likely originated from a bat but transferred to humans via an intermediary animal. Could the virus have emerged from a Chinese lab, as former CDC Director Robert Redfield recently suggested? That's the least likely scenario, says the WHO's chief scientist, Dr. Soumya Swaminathan. "The betacoronaviruses are very, very common in bats and there's a lot of genetic similarity between the SARS-CoV2 and many of the viruses in the...bat species," Dr. Swaminathan told Ian Bremmer in an interview on GZERO World, airing on US public television stations starting April 9. Check local listings.

Watch the episode: Vaccine nationalism could prolong the pandemic

2.8 billion: Chinese regulators fined e-commerce giant Alibaba a record $2.8 billion — about four percent of its 2019 revenue — for abusing its dominant market position and forcing merchants to operate exclusively on its platform. Alibaba founder Jack Ma has fallen out with Beijing in recent months after the billionaire publicly criticized China's regulators for stifling innovation in technology.

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