The Decline of Germany and France: Can Europe Stay Strong in a Multipolar World?

In 2024,ig foreign exchange the transatlantic region experienced two significant elections—a slight rightward shift in the European Parliament elections in June and the return of Trump in the U.S. presidential election in November. These events have drawn considerable attention to Europe's role in the global political and economic landscape. Within Europe, the rise of populism and growing economic discontent are apparent, while externally, there are potential shocks from Trump's protectionist policies.

Changes in Europe's Internal Political Landscape: The Decline of Mainstream Parties and the Rise of Populism

Post-European Parliament elections, traditional parties in leading countries like France and Germany lost further ground. In France, the political scene is increasingly polarised into left, center, and right factions, weakening the EU's leadership. Germany faces even greater challenges, with Chancellor Scholz failing a vote of confidence, leading to an impending snap election, and the far-right party, Alternative for Germany, ranking second in polls.

Simultaneously, the rise of populism is closely tied to the economic issues brought about by the prolonged Russia-Ukraine conflict. The public's war fatigue and discontent with the capitalist system add pressure to Europe's political stability. Experts believe these internal challenges are undermining Europe's capacity to play a significant role in a multipolar world.

External Challenges: Trump's Return and Strained US-Europe Relations

Trump's return introduces new uncertainties for Europe. His team has proposed raising NATO member countries' defense spending to 5% of GDP, significantly above the current 2% target, potentially increasing defense burdens for Europe. Trump has also revisited concerns about the US-Europe trade deficit, threatening more tariffs on the EU and demanding more American energy purchases.

US-Europe trade frictions could further extend to issues like the Russia-Ukraine conflict and climate governance, complicating bilateral cooperation. Although the EU aims to boost internal resilience through strategic autonomy, diverging positions among member states on defense, trade, and industrial policies remain a major weakness.

Opportunities and Challenges in China-Europe Relations

Amidst tightening US-Europe relations, China-Europe relations face new opportunities and challenges. Last October, the EU's anti-subsidy tariffs on Chinese electric vehicles stirred controversy, prompting deep discussions on a price commitment plan. Recent calls by German Chancellor Scholz to quickly resolve the issue through negotiations underscore EU concerns about a trade war with China.

Intensifying competition in sectors like lithium batteries, photovoltaics, and electric vehicles is a major point of contention in China-Europe ties. Experts suggest that both sides should leverage WTO rules to prevent an escalation in trade disputes. Remarkably, 2025 marks the 50th anniversary of China-EU diplomatic relations, offering a significant opportunity to deepen bilateral cooperation.

Europe's Future: Positioning in a Multipolar World

Amid internal political and economic pressures and shifting international relations, whether Europe can continue to be a pole in a multipolar world is a focal point of expert discussions. The prolonged Russia-Ukraine conflict, the rise of populist forces, and US-Europe tensions all challenge Europe's leadership in global affairs.

Experts emphasize that Europe needs to strengthen its strategic capabilities, reduce external dependencies, and pursue internal policy coherence. For China, the future of China-Europe relations requires fresh examination and positioning, with an emphasis on mutual benefit and win-win outcomes.

Facing multiple challenges, how Europe navigates the new landscape and maintains its crucial position in a multipolar world will be a key focus in the future global political and economic landscape.

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