Three years of declining economic growth in the European Union since they chose to stand lock-step with the United States on sanctions against Russia have brought the coalition of European countries to a turning point. And the one nation holding the best cards to take advantage of this is China.
One of the primary reasons why governments create socialistic economies is because they understand that as long as the people have enough basic needs covered, they will rarely act to overthrow their political regimes. And even as the former President of the United States Bill Clinton correctly surmised during the 1990’s when he went on to serve two terms in office, the biggest issue will always be the economy stupid.
Populations historically have had a long rope when it comes to being oppressed, and will put up with the loss of civil liberties and being crushed by taxes as long as they somehow are able to put food on the table, and keep a roof over their heads. But at a certain point even this rope ‘breaks’, as seen right now down in Mexico following the government’s order to raise gasoline prices to unaffordable levels.
That breaking point has finally reached Europe, and is even threatening the foundation of the European Union itself. As not only is one country (Britain) already on their way out of the EU, but upwards of four elections could shift the balance of power from one of unity, to that of nationalism and protectionism.
Yet even if the European Union does not completely fall apart from the political and economic movements currently shaking the coalition, the die has already been cast for many of these nations to break their treaty with the EU on creating trade partnerships that do not adhere to EU regulations. And the one economy ready and willing to quickly move into this turmoil is China.
China’s readiness to seize on an opportunity in Europe is very similar to what Russia has done over the past three years in the oil industry where new partnerships with Syria, Iran, and even Saudi Arabia have grown at a time when the United States has destroyed long-standing relations with their petro-dollar partners.
They say that one man’s crisis is another man’s opportunity, and this transfers over as well to nation states and economies. And while the early predictions are still up in the air on what a Trump presidency will mean for free trade, protectionism, and a pulling back of globalism, the ripest fruit tree in the orchard is suddenly becoming a wide open prize, and Beijing is salivating at the chance to pick up more than just low-hanging fruit.