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The Global Economy in 2030

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The Global Economy in 2030

Trends and Strategies for Europe

CEPS,

15 min read
10 take-aways
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Europe 2030: An aging region with slowing productivity and growth may yet undergo a resurgence.

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The Centre for European Policy Studies (CEPS) has prepared a forecast-filled look at the European Union’s likely economic, social and political development through the year 2030. Not all of CEPS observations are encouraging; in fact, some are downright bleak: The EU will have the oldest regional population in the world by 2030, its labor productivity will grow more slowly than ever and the bloc’s global influence could diminish. But greater trade with developing nations and changes in variables such as immigration could produce an economic surge that would lift the EU’s performance above that of other major economies. The paper, which sometimes mires down in statistics and models, investigates the myriad factors affecting the EU’s economic future, such as trade policy, demographics, climate change, technology and energy. getAbstract recommends this provocative, in-depth exploration of the EU’s prospects to business executives, economists, policy makers and analysts seeking a detailed vision of Europe in 2030.

Summary

The Europe of 2030

Econometric models centered on regional as well as global financial, economic and demographic factors have produced a “central scenario” showing the European Union’s likely economic course up to 2030. The research also raises questions about economic shocks, or “game changers,” that could alter the EU’s likely path in the years ahead.

Among other concerns, policy proposals must account for the probability that Europe – faced with an aging population and a declining workforce – will experience an extended era of “excess savings,” or surplus capital, as well as sluggish growth in labor productivity. In fact, one econometric model predicts annual productivity growth rates of only 1% to 2% for the advanced countries through 2030.

Global Trends: Exports and Energy, Population and Poverty

Manufacturing remains significant to Europe’s economy, representing approximately 15% of its GDP, and it might become even more important in the future. To pay its bill for imported energy, the EU needs to achieve bigger trade surpluses in goods and services. The EU pays more than $500 billion annually for imported energy, far more than the United States...

About the Authors

Daniel Gros is the director of the Brussels-based Centre for European Policy Studies, a research institute where Cinzia Alcidi is the head of the economic policy unit.

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