The need for speed
Disruptive change in the global environment is placing stress on growth models in Europe & beyond, requiring rapid policy responses
Across advanced economies, national growth models need to adapt to a rapidly changing world. Patterns of global flows and the locations of competitive advantage are shifting rapidly in response to geopolitical rivalry, competitive industrial policy, higher energy prices, and so on.
Many growth models are being placed under increasing strain. Change needs to happen fast.
Reflections from Germany & the UK
I have been in Germany this week, reminding me of the structural challenges facing Europe’s largest economy. From the unreliability of Deutsche Bahn, to airport delays and patchy internet, the under-investment in Germany’s core infrastructure was evident.
More fundamentally, Germany illustrates the deep challenges caused by global economic and geopolitical dynamics. From around 2000, Germany generated strong export-led growth on improved competitiveness and a presence in high growth industrial sectors. Germany grew its exports/GDP share from ~30% in 2000 to ~45% by 2012, holding it…