Realpolitik and the European Union. Chapter 11. Europe in the World. Part II. Russia, energy, demography.

The theme of Chapters 10 and 11 is the tension between a shrinking Europe living in an expanding world of nation states, while all the while seeking to dis-establish European nation states which experience global developments differentially. Chapter 10 discusses the impacts of the US continued primacy, and the rise of Asia,  on the European mosaic.  Chapter 11 discusses Russia’s political alienation from its major markets in Europe, and its fear and temptation of overdependence on China ; the world’s continued dependence on fossil fuels from the Gulf, along with the rise of Islamic fundamentalism; the demographic shrinkage of an ageing Europe, and the prospect of mass immigration from Africa, the Mid East, and beyond.

Russia torn between Europe and Asia.

Asia’s rise draws Russia into its orbit, but also accentuates Russia’s political isolation from Europe, by far its largest market. Fearing overdependence on imports of oil from the Gulf states, China has consistently sought to formulate a continental energy strategy. Following the Soviet Union’s collapse, China’s leadership has sought alternative oil and gas supplies in Central Asia. Kazakhstan, with its huge territory, low population density and extensive energy resources, is the key state. In 1997, CNPC purchased a 60% stake in Kazakhstan’s Aktobemunaigaz, and in September, then Premier Li Peng signed $9.5 billion contracts for the oilfields in western and northern Kazakhstan, and to help fund pipelines through to China and Iran. The idea was to extend a network of Russian, Siberian and Central Asia network of pipelines to reach China. But the project was halted by the 1997-98 Asian financial crisis, the change in government in Beijing and CNPC-the China National Petroleum Corporation—interest in more commercially viable domestic or foreign operations.

With German unification, Russia’s leadership looked first and foremost to anchor their country in Europe. They were led to believe that NATO would not extend its membership to the former countries in the Warsaw Pact[1]; in 1994, a step was taken to shape a formal policy of neutrality for the Ukraine agreed on by both Russia and the western powers. Ukraine’s nuclear forces were dismantled, and Ukraine given a promise of protection by the western powers in return.

Then, between 1999 and 2011, NATO extended its membership into central, north and south-eastern Europe.[2] Membership, it was said, would help stabilize the new democracies, encourage peaceful settlement of disputes, and extend the area under the collective security umbrella of the US and the western alliance. But the move was vigorously opposed in an open letter to President Clinton by over 40 luminaries of US foreign policy with experience dating back to the world war. Enlargement, they argued, was “a political error of historic proportions”. [3] It was bound to encourage anti-western political forces in Russia.

The old reflexes of anti-westernism were deeply embedded in the Moscow bureaucracy. A constant of Russian foreign policy since the early 1990s had been  to form a ghost USSR in the form of its “near abroad”. The main vehicles of this policy have been the energy and pipeline companies, closely tied into the Kremlin power grid. They remain active across the length and breadth of the old USSR. The other instrument of policy has been the Russian armed forces, which bombed their way to a peace of sorts in the two Chechnya wars, and in which President Putin invested heavily from the moment he took office in 2000.

A fundamental reason for Russia’s re-militarisation was NATO expansion, coupled with Europe’s excursion into post modernism, by contrast to Russia’s rediscovery of its national past. With Maastricht, the EU’s  enthusiasts rejoiced that their moment had come. There was a frisson of worry that a globalized economy would sweep away the constraints on nationalism and trade. But little time was lost in worry: almost immediately, the EU marched boldly into its utopia of a single currency, climate change, a global human rights agenda and an EU constitution of sorts. As Chancellor Kohl pronounced in 1996, disintegration of the nation states of Europe into one large integrated political union was a “question of war and peace in the twenty-first century”. [4] As of 1996, was  NATO began to extend its reach in to Russia’s near abroad, Moscow began to open feelers to Beijing, ending in the historic agreement of 2004, whereby Russia and China agreed on their existing frontier, while China abandoned its claim from the 1860s to reclaim Siberia as theirs.

China’s aim for settling the frontier issue with Russia was grounded in simple realpolitik. Russia was a nuclear power, a UN Security Council permanent member, a major potential source of oil and gas supplies, and in need of friends on the world stage.  China had much more to gain by developing its coastal ports and entering world markets in force rather than quibbling about territory, however extensive. There was much less interest in Beijing in settling China’s frontiers with India. In 1998, the first thing the newly elected BJP did was to demonstrate that India had a nuclear capability, and was therefore on a footing to negotiate with China. But China has been less forthcoming: the two giants rival for influence along the whole area running from Burma, across the Himalayas, and to Pakistan, with which China has been closely allied since the 1970s.

There are obvious reasons for close co-operation between China and Russia on energy. Officials in both Beijing and Moscow, as well as in Delhi, have talked of acting in “strategic partnership” to act as a counterweight to the US in world affairs. They have mutual interests to stabilise frontiers, expand trade, prevent armed conflict in the Korean peninsula or Pakistan, and counter radical Islam.


China economy dwarfs Russia.: GDP constant US $s

Source: World Bank, OECD.

But many officials in Moscow see China as the main future rival. Underlying this is the old Russian fear of China, hailing back to the Mongol invasions of the 13th century. In its post-cold war version, this interprets into deep suspicions of Chinese intentions on Siberia and the Russian Far East, where there is a massive demographic imbalance between the 7 million Russians there  and the 130 million in the adjoining Chinese provinces. Suspicions are sharpened by strategic competition in Central Asia, and a modernised and assertive PLA. Russia has yet to join the WTO, whose doors were opened to China at Doha in December 2001.Not least, China and Russia are rivals for status in world affairs, as well as in economic development. By 2015, China economy, at par with Russia’s in 1990, was more than five times larger by 2015 and heading to double or triple the size of its economy in the decades to come. Europe by contrast is dependent on Russian gas, pays in hard currency, and its major power, Germany, is militantly pacifist.

Europe’s energy dependence.

Two of Jean Monnet’s favoured plans for European integration, the Coal and Steel Community and the Euratom treaty, were undercut by western Europe’s conversion from coal to oil . In 1950, at the time of the Schuman Declaration, western Europe ran on coal. The shift to oil occurred swiftly. Changes in U.S. tax incentives in 1958 encouraged the oil majors to increase their liftings from the oil-rich region of the Gulf and the Middle East. In Europe, the port at Rotterdam became the hub of tanker traffic for imported oil as a main energy source. Primary energy imports to Europe in the 1960s rose by a multiple of four, displacing indigenous coal resources. Consumer prices were kept low, through the oligopolistic structure of the oil market, dominated by the seven major Anglo, Dutch and U.S. companies, with extensive downstream facilities in Europe.

A number of consequences flowed from these events. Cheap oil stoked world growth. The conversion to oil extended the dollar’s primacy, as the key commodity currency. With Iran and Libya pushing for high oil prices, President Nixon in August 1971 announced the end of the dollar’s convertibility to gold. The measure launched the world on the dollar paper standard, and was followed by the 1973 Arab Israeli conflict , the outcome of which confirmed US predominance in the Mediterranean, the Middle East and the Gulf.

US policies shifted the world economy on to oil as its primary fuel. The consequence for Europe and the world was greater dependence on political conditions in the main supplier countries, and on a roller coaster of global oil prices (See Graph below). The whole region stretching from the Levant to Afghanistan became a war zone, drawing in both world powers, the USSR and the USA. The world-wide rise in oil prices, initiated by Libya and Iran in 1970-1971, lasted fifteen years. High oil prices encouraged Japan and Germany in their export drives and  precipitated oil importers into debt. They also helped to disguise the severity of the economic crisis afflicting the Soviet Union. When oil prices fell in 1986, the Soviet Union lost $5 billion in export revenues a year during 1986-1989. [5] Falling oil revenues prompted Iran and Iraq to end their bloody nine year conflict in 1989, but then stimulated Saddam Hussein to ask Kuwait to fund the debt which Iraq had incurred during the conflict. Kuwait’s refusal sparked the Gulf war of 1990-91. Oil prices only recovered again with China’s entry on to world markets in the early 2000s. They then plunged again in 2011, as illustrated in the following graph.

Twenty-five years after German unity, the Mid East and Gulf remain the  world’s swing oil producers, and a large exporter of oil and gas. The ratio of export to production is 66% for oil, and 15% for gas. The novelty is that the Gulf’s prime market is Asia, as China overtook the US as the world’s prime energy importer in 2014.  The implications for global finance are considerable: if Beijing opts for currency convertibility, its oil imports from the Gulf could well become denominated in Yuan; if China continues to denominate its oil imports in dollars, there will be a continued incentive to earn foreign exchange in dollars. That means continuation of the past decades of large Chinese export surpluses with Europe, its No 1 export market, and North America, its 2nd export market. Meanwhile, the security of Saudi Arabia depends on continued US protection. Since 9/11-when 15 out of the 19 terrorists to attack Washington and New York, were Saudi nationals-the relationship has been challenged in the US. In particular, the US is now net self sufficient in energy, and public opinion there is hostile to becoming engaged in the region’s affairs.

One reason is the US’ inability to win its wars in Afghanistan and Iraq, and the results of President Obama’s policy to encourage democratization in the whole region from the Levant to the Gulf. Obama’s speech at Cairo in 2009, promoting US democratic values, did not have the expected results. It helped to undercut President Mubarak’s regime in Egypt in 2011, and led within a year to  a Moslem Brother being elected to the Egyptian presidency. Mohamed Morsi proceeded to impose an Islamic constitution on the country, with the result that he was overthrown by a military coup in 2013, that had the blessing of the Saudi royal family. Libya slipped into violent anarchy, following the Franco-British overthrow of Gaddafi. Islamists  seized a territory larger than the UK out of Syria and Iraq , and declared jihad on the western world. Russia came to the support of  the Assad regime, which the western powers wanted to overthrow.

The obvious alternative to European reliance on energy imports from the Gulf is greater trade with Russia. Germany accounts for one third of EU exports to Russia; Siberia sources 40% of Germany’s gas supplies; and the EU provides 80% of Russian foreign exchange. Russia is and is expected to remain, the world’s prime gas supplier. Europe is expected to remain No 1 natural gas importer, and Russia’s prime client. In geopolitical terms, Russia and Europe are soldered together at the hip. This may be illustrated by the following map of pipelines from Russia into the European energy markets.

Source: The Economist, April 3, 2014.

Nonetheless, Europe’s post modernism and Russia’s nationalism has pushed Russia closer to China, than to Europe. Both Moscow and Beijing agree that western human rights imperialism is a cover for more sinister motives. Both Beijing and Moscow look askance at the pro-democracy and human rights activities of western NGOs. The EU’s support for closer relations with the Ukraine, backed by Poland, Brussels and less ostentatiously by Germany, culminated in the proposal in 2013 for Ukraine to enter into a closer arrangement with the EU. Its proponents in Kiev, Warsaw, Berlin and Vienna saw this as proving an incentive for the necessary reforms to be pushed through in Kiev. But Putin interposed his veto, and in 2014, Russia grabbed the Crimea by force. The Helsinki accords of 1975, whereby frontier changes were to be sanctioned only by assent of all European states, was jettisoned.

The key point about the crisis in the Ukraine, and Russia’s occupation of the Crimea, followed by a referendum yielding a near 100% endorsement of the region’s absorption into Russia, is that the EU’s, and therefore Germany and Poland’s borders with Russia, are not stabilized, as in the case of the China-Russian frontier.  Chancellor Merkel led the western powers to impose sanctions on Russia, and registers disapproval about Russian policies on human rights, towards the Ukraine, or in Syria.  But Germany brushes aside Polish concerns about Berlin-Moscow relations, and keeps doing business there.

There is a very good reason for this policy too. Germany is militantly pacifist.  Russia is now the third military power in the world, after the US and China. The Russian government has inherited from its predecessors its conviction that high finance, centred in London and New York, is always on the prowl for victims.  Germany’s hostility to liberalization of financial services in the EU is inspired by similar sentiments. All EU member states are energy dependent, and give overwhelming priority to welfare, while paring back on warfare capabilities. The EU may be the world’s giant emporium, but that is it. On the world stage, the EU is a dwarf, with a loud megaphone, declaring to an empty theatre that the world should follow its example, embrace post modernism, dismantle its nation states,  and champion human rights around the world, in such countries as Russia, China or Saudi Arabia.

Yet Germany is also an accomplished practitioner of Realpolitik. At peace with its neighbours to the west and to the east, Germany no longer feels so enamoured with the idea of sacrificing hard won unity on the altar of a distant EU federal project.  This was most evident in the Constitutional Court’s judgement on the Lisbon Treaty, in which the EU was defined as no more than an alliance of states, and its Brussels based bureaucracy little more than an upbeat international agency. The verdict, and Germany’s behaviour on the European scene, indicated for those who wanted to see that Germany had now taken over de Gaulle’s mantle as a champion of a Europe of the states.

That national policy in Germany takes priority over EU policy is nowhere better illustrated than in energy policy. Germany is Europe’s prime manufacturing centre, and No 1 per capita exporter in the world. As a major global energy consumer, it imports about two-thirds of its needs. Russia, Norway, and the UK are the largest exporters of oil to Germany. Germany is the third-largest consumer of natural gas in the world; 40% of its natural gas imports come from Russia. Russia is thus a key strategic partner for Germany, and Germany is a key partner for Transneft and Gazprom. Since the late 1960s, Germany has subsidized domestic coal production, which is the main source of electricity. The ongoing plan is to build 25 new coal plants. Nuclear power accounts for over 17% of national electricity supply. But in response to anti nuclear power protests in the wake of the March 2011 Fukushima Daiichi nuclear disaster, Chancellor Merkel announced that all nuclear power plants would be closed by 2022. Eight of the 17 operating reactors in Germany were closed down. Merkel said that the phase out would give Germany a competitive edge in renewables, which by 2012 accounted for 25% of electricity consumption, more than the electricity generated by nuclear power stations. These decisions were not taken in close consultation with neighbours.

There are some key conclusions to draw here for Europe’s geopolitics. For the world as a whole, fossil fuels remain massively predominant, with coal replacing oil, and gas taking a larger share of the mix. The axis of the global energy economy hinges more than ever on the nexus between Asia Pacific and the Gulf. Russia, China, the US and France remain wedded to nuclear energy, while Japan may do so. Japan may also become much more energy interdependent with a net self sufficient US. This is the other major trend: because the US remains engaged internationally, but net self sufficient in energy, its influence as an offshore arbiter in world affairs offers the US the opportunity to exert greater, not lesser influence. Germany’s option against nuclear involves a wager on renewables, but in fact has encouraged further development of domestic coal resources, involving possible large increases in imports from Poland. It also deepens Germany’s, and Europe’s dependence on Russia. Russia’s share of Russian natural gas in the member states’ domestic  consumption for the year 2007 is as follows:[6]

Estonia 100%                Slovenia 52%

Finland 100%                Hungary 60%

Latvia 100%                 Greece 76%

Lithuania 100%             Austria 49%

Slovakia 98%                Poland 48.15%

Bulgaria 92%                Croatia 37%

Czech Republic 77.6%   Romania 27%

Germany 36%               Italy 27%

France 14%                   Belgium 5%

For non-EU countries in Europe the share of Russian natural gas in domestic gas consumption is as follows:

Macedonia 100%           Serbia 87%

Belarus 98%                 Montenegro 87%

Ukraine 66%                 Turkey 64%

Switzerland 12%

The conclusion is that Russia is a de facto member of the European family, whatever may be considered with regard to the Crimea, human rights or sanctions.

 Demography and immigration.

Europe is ageing.  In 1900, the world population was 1.7 billion, rising to 2.5 billion in 1950, and 6.0 billion in 2000 . One major transformation is the steady shrinkage of the populations of North America, Europe and the ex-USSR from 30% of the total in 1900 to under 20% in 2000, and a similar trend is underway in China. Higher population growth rates are recorded in Latin America, India, and the rest of Asia. The 2015 UN figures indicate that the world’s population has reached 7.3 billion (see Table below). Sixty per cent of the global population lives in Asia (4.4 billion), 10% in Europe (738 million), 9% in Latin America and the Caribbean (634 million), and the remaining 5% in North America (358 million) and Oceania (39 million).  China holds a population of 1.3 million, and India has a population of 1.3 billion, representing 19 and 18 per cent of the world’s population respectively.

Population in millions:    2015,      2030          2050,     2100

Africa                                    1186      1679              2478   4387

Asia                                       4393      4923             5267   4889

Europe                                    738         734               707     646

Latin America                       634         721               784      721

North America                      358         396              433      500

World                                   7349        8501            9725    11213

Source UN. World Population Prospects: 2015 Revision.

The world’s population growth is slowing overall, and is projected to increase to 8.5 billion by 2030, 9.7 billion by 2050, and 11.2 billion by 2100. The UN considers that the figure for 2030 is virtually certain, and the further the trajectory goes into the future, the less accurate are the forecasts. More than half of the global population growth is expected to occur in Africa (see Table), amounting to 54% of the world’s total population. African women’s fertility rate, currently at 4.7 children per woman, is expected to decline to 3.1 around 2050, still well above the 2.1 required for replacement. By contrast, fertility in all European countries is well below replacement of the population. These figures record an ageing population for Europe, and North and South America, a decline in the size of the working age population there, employer demands for immigrant labour and strains in pay-as-you go pension schemes. [7]

As the UN points out, though, increasing levels of migration could well offset the expected decline in the size of the European population. In economic terms, migration is seen as positive for economic development because immigrants bring their labour to the host country, and send remittances to their home countries. The main recipient of immigration in the first fifteen years of the new millennium were the high income developed countries, which absorbed 4.1 million net migrants annually from poorer parts of the world. These trends are expected to continue into the foreseeable future, such that 82% of population growth in high income countries is expected to stem from immigrant families.

In a broader definition of Europe, inclusive of Russia the Balkans, or Switzerland and Norway, the breakdown of population in millions may be presented in terms of eastern, northern, southern and western Europe. (See Table). Eastern Europe is expected to remain the largest segment of the European population, but as may be seen, the population is expected to decline. Poland’s population declined from the 1990s on, as emigration to western Europe began to take effect. In the future, Poland shares with Russia a continued fall in fertility rates. By contrast, the Swedish and the UK populations are set to grow considerably. The jump in the UK’s population from 1990 to 2015 is almost all the result of the New Labour government’s open doors policy, principally-as already argued-to immigration from the sub-continent. If we take the UN calculation as a basis, then by 2050, the descendants of immigrants from the late 1990s onwards will number over 16 million. A similar development is in store for Sweden.

1950       1990       2015       2030       2050

Eastern   220.2     310.0      292.9       278.6        251.7

Poland      24.8       38.1          38.6         37.2          33.1

Russia     102.7    147.6         143.5       138.6         128.6


Northern   78.0      92.0         102.4       110.1        117.6

Sweden           7.0        8.6             9.8         10.7          11.8

UK                50.6       56.2            64.7        70.1           75.4

Source: UN: World Population: 2015 Revision.

The population of Southern Europe, and of the two largest population countries, Italy and Spain,  show rather distinct patterns. Italy’s population has been stagnant at least since the early 1970s with a sharp fall in fertility rates. To a lesser extent, the same applies to Spain. Both have become for the first time in their histories countries of immigration. In 2015, there were over 5 million foreign nationals in Italy, and over 4 million in Spain. France, for long a country of immigration from Europe, in 2015 was home to 11 million people either immigrants or their second generation. West Germany absorbed refugees from communism after 1945, and during the 1960s took in workers from Italy, the Iberian peninsula and Turkey were brought in. By 2015, Germany was the second most popular migration country in the world after the United States. Over 16 million people in Germany were of immigrant background.

1950     1990          2015        2030         2050

Southern  108.6   138.5         152.4       149.5        141.9

Italy               46.6     57.0            59.7        59.1          49.6

Spain             28.0    39.1            46.1        45.9          44.8


Turkey         21.4    53.9            78.6         87.7          95.8


Western   142.3    175.6        190.8       195.7    195.5

France       41.8      56.9         64.4          68.0           71.1

Germany   69.7      78.9         80.6          79.3           74.5

Source UN: World Population: 2015 Revision.

Where did they come from? In 2010, there were 47.3 million foreign born residents in the EU, equal to 9.4% of the total population. Of these, 31.4 million were born outside the EU and 16 million were born in another member state. [8] By 2016, the number of people living in the EU-28, born outside of the EU had risen to 35 million. The largest number were found in Germany (8.7 million), the UK (5.6  million), Italy (5 million), Spain(4.4 million) and France (4.4 million). Tha prime sources of immigration came from Morrocco, Albania, Turkey, India and Pakistan. Looking to the future, the UN estimates that the main sources of immigration to Europe are likely to come from India, Bangladesh, Pakistan, and from Africa, north and south of the Sahara. Once citizenship has been acquired within one member states, Article 39 of the Lisbon Treaty ensures freedom of movement within the EU.

In 2015, more than a million migrants and refugees crossed into Europe across land by the Balkans, or by sea to Italy and Spain, fleeing the conflicts in Syria,  Afghanistan , Iraq or Eritrea. Increasing numbers came from sub Saharan Africa. The expectation is that these numbers will rise, as in the graph above. By 2070, Eurostat, the statistical agency of the EU, calculates that the EU will have seen net immigration rise by 77 million. By 2080, these migrants and their progeny are expected to have increased the EU population by 121 million, relative to what the continent’s population would have been by then.

This official view may be starkly under reporting the inflow of people to Europe. Take the UK migration figures for 2015: net immigration is counted as 330,000, but double that number of National Insurance numbers were issued that year. In France, among high school students, 33.2% identify as Christian, and 25.5 as Muslim. [9] Africa’s population in the 15 to 24 age bracket at 229.6 million is nearly equal to the whole of the EU-28 labour force, and has unemployment rates in that group ranging from 20 to 50%. With wages a multiple of those available at home, plus readily accessible welfare benefits, and rights that could scarcely be dreamed of at home, it is not surprising that Europe, with a shrinking population, has become a magnet for refugees and migrants.

The migration flows to Europe bring with them the migrants’ own baggage of cultural and religious inheritance. This is particularly the case of Islam.  From a small number of mosques in Europe in the 1980s, one estimate places the number in 2010 at around 10,000. [10] Terror activities perpetrated by Muslims across Europe have multiplied,(see Graph below) as did no-go areas where national law no longer ruled. In the UK, there are an estimated 100 such ghettoes where Sharia law alone prevails; the banlieues of Paris and Brussels are breeding grounds for terrorists. At least, three thousand young Muslims from Europe travelled to Syria to fight for ISIL In the UK, repeated incidents showed that police or social services failed to protect under age girls from being gang raped by Muslim men, for fear of being dubbed as “racists”.

Number suspects arrested for religiously inspired terror

Source: Europol. EU terrorism situation and trend report 2016.p. 23.

As the Pew Research Center records, Europe is expected to have its native Christian population shrink by 99 million to 2050, while its Muslim population is expected to rise by 27 million to 70 million overall by 2050. Though the Moslem share of Europe’s population at 6% in 2010 is officially forecast to rise only to 10% in 2050, the wars currently wracking Islam,[11] combined with failure of Muslims to integrate into European culture, Christian or secular, make this prospect particularly sensitive. In early 2017 poll across 10 European countries[12] found that  an  average of 55% of those interviewed considered that all further migration from Muslim countries should be stopped; the numbers ranged from 71% in Poland, 65% in Austria, 53% in Germany and 51% in Italy to 47% in the United Kingdom and 41% in Spain. In no country did the percentage that disagreed surpass 32%.

When Chancellor Merkel in August 2015 called for Europe to welcome the migrants, she added that “the world sees Germany as a land of hope and chances.” Referring to the second world war, she added “that wasn’t always the case”. Merkel then teamed up with President Hollande to suggest that the EU distribute asylum seeker quotas per member state. The policy got a frigid reception.   One by one, EU member states -Hungary, Bulgaria, Austria, Croatia, Slovenia, and Germany itself broke with the Schengen free movement policy and imposed frontier controls.

In conclusion to Chapters 10 and 11, the post-1990 world has turned out very different to the world of pre-1914. Then, Europe was at its apogee; after 1990, it was one part of a non-homogenous global system, penetrated by markets and composed of political units, the vast majority of which subscribed to the Westphalian ideal of autonomous states, interdependent among each other and jealous of their political independence, however fragile. The EU was an exception: it sought to overcome Europe’s fragmentation through a strategy of merger via integration, rather than by hostile takeover. Yet, its component units, the member states, remained the focus of their citizens loyalties, while responding differentially to global developments.

Twenty-five years after the great transformation of 1989-1992, the United States remained the sole world power, exerting constant and extensive  influence on Europe. The Eur-Atlantic area remained the heartland of global investment by the multi-nationals. The major change has been the rise of Asia, with the resulting stimulus to world trade, and global commodity markets. Russia remains torn between Asia and Europe, but is de facto a member of the European family. Its prime ally in Europe is a militantly pacificist Germany. Overall, though, Europe remains dependent like the rest of the world on oil from the Gulf, whose monarchies finance the export of Islam, while refusing to take in their co-religionnaires fleeing war and persecution in Syria and Iraq. Europe, with its shrinking populations, generous welfare provisions, and freedoms,  has become a chosen target for immigration from Africa, and in particularly from Islamic majority countries. This has opened up a widening gap between European publics who want to stem the rise of Islam in Europe, and their elites who wager that it is possible to develop a “European Islam”. Overall, Europe’s reactions to immigration as to energy dependence or the rise of China is as varied as the components of its mosaic of peoples and states.

[1] Joshua R.Itzekowitz Shifrinson, “Deal or No Deal? The End of the Cold War and the US offer to limit NATO expansion”, International Security, Volume 40.4.pp.7-44.

[2] Poland, Hungary and the Czeck Republic joined in 1999; Bulgaria, Romania, Slovakia, Slovenia, Latvia, Estonia and Lithuania joined in 2004; Albania and Croatia joined in 2009; in 2011, NATO opened talks with Bosnia and Herzeogina, Georgia, Macedonia and Montenegro. There has been debate about joining in Sweden and Finland, as well as in Serbia, and, very divisively, in the Ukraine.

[3] « Open Letter to President Clinton », in Robert W. Rauchaus, ed, Explaining NATO Enlargement, London: Frank cass, 2001, pp.203-206.

[4] Speech at the Catholic University of Louvain, February 5, 1996.

[5] Ed A. Hewett, Open for Business: Russia’s Return to the Global Economy, The Brookings Institution, Washington D.C., 1992, p. 13.

[6] Commission, Brussels, 16.07.2009, SEC (2009) 978 final. Assessment Report of the Directive 2004/67/EC on Security of Gas Supply.

[7] See Sheetal K.Chand, Albert Jaeger, Aging Populations and Public Pension Schemes. IMF Occasional Paper 147. Washington DC 1996.

[8] Katya Vasileva, 6.5% of the EU population are foreigners and 9.4% are born abroad, Eurostat: statistics in focus. 34/2011.

[9] “L’école defiée par la religion”, L’Obs Fevrier 4,2016.

[10] Stefano Allievi, Mosques in Western Europe, Oxford Islamic Studies, July 2014.

[11] David Masci, “Europe projected to retain its Christian majority, but religious minorities will grow”, Pew Research Center. April 15, 2015.

[12] “What do Europeans think about Muslim immigration”,


About Jonathan Story, Professor Emeritus, INSEAD

Jonathan Story is Emeritus Professor of International Political Economy at INSEAD. Prior to joining INSEAD in 1974, he worked in Brussels and Washington, where he obtained his PhD from Johns Hopkins School of Advanced International Studies. He has held the Marusi Chair of Global Business at Rensselaer Polytechnic Institute, and is currently Distinguished Visiting Professor at the Graduate Schoold of Business, Fordham University, New York. He is preparing a monograph on China’s impact on the world political economy, and another on a proposal for a contextual approach to business studies. He has a chapter forthcoming on the Euro crisis. His latest book is China UnCovered: What you need to know to do business in China, (FT/ Pearson’s, 2010) ( His previous books include “China: The Race to Market” (FT/Pearsons, 2003), The Frontiers of Fortune, (Pitman’s, 1999); and The Political Economy of Financial Integration in Europe : The Battle of the Systems,(MIT Press, 1998) on monetary union and financial markets in the EU, and co-authored with Ingo Walter of NYU. His books have been translated into French, Italian, German, Spanish, Chinese, Korean and Arabic. He is also a co-author in the Oxford Handbook on Business and Government(2010), and has contributed numerous chapters in books and articles in professional journals. He is a regular contributor to newspapers, and has been four times winner of the European Case Clearing House “Best Case of the Year” award. His latest cases detail hotel investments in Egypt and Argentina, as well as a women’s garment manufacturer in Sri Lanka and a Chinese auto parts producer. He teaches courses on international business and the global political economy. At the INSEAD campus, in Fontainebleau and Singapore, he has taught European and world politics, markets, and business in the MBA, and PhD programs. He has taught on INSEAD’s flagship Advanced Management Programme for the last three decades, as well as on other Executive Development and Company Specific courses. Jonathan Story works with governments, international organisations and multinational corporations. He is married with four children, and, now, thirteen grandchildren. Besides English, he is fluent in French, German, Spanish, Italian, reads Portuguese and is learning Russian. He has a bass voice, and gives concerts, including Afro-American spirituals, Russian folk, classical opera and oratorio.
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