The European Union’s quest for more autonomy vis-à-vis the rest of the world (also called ’strategic autonomy‘) may come at the expense of serious sacrifices in the Eastern European countries. A closer look at the examples of the Czech Republic, Poland, Slovakia, and Hungary (the ‘V4 countries’) shows that the V4 countries are more vulnerable to policies aimed at reducing the EU’s reliance on international trade. This is because these countries have a unique economic profile in contrast to other EU countries, and especially the founding members (France, Germany, Italy, and the Benelux countries). This difference is rooted in history, as after the collapse of the Soviet Union the Eastern European states adopted a laissez-faire approach to the economy to rapidly catch up to Western EU countries. Such an approach was their only option.
To come to this conclusion, an analysis capturing how vulnerable countries are to policies aimed at reducing reliance on international trade was calculated in this article. This analysis aggregates information about the ranking of countries in various macroeconomic indicators such as Gross Domestic Product per capita, Human Development Index (HDI), the Foreign Direct Investments Restrictiveness Index, Trade Openness, Global Competitiveness Index (GCI), and Foreign Direct Investments Inward flows. Overall, the analysis shows, apart from the Czech Republic, that V4 countries are more vulnerable to restrictive policies regarding international trade than other EU countries, especially the founding members.
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05-FILIP BLAHA AUTONOMY VERSUS DEPENDENCY WHY THE EU SHOULD STICK
These results are at odds with the general direction the European Commission has pursued recently. It has introduced its ‘strategic autonomy’ agenda, which encompasses several policies related to the digitization and green transformation of the economy, with the goal of reducing reliance on international trade.
Unique Structure of V4 Economies Within EU
Together, the V4 countries are the fifth largest economy in Europe and 12th globally. The region would rank as the 22nd most populous country in the world and 4th in Europe (64 million people) with most people living in Poland (38 million), followed by the Czech Republic (11 million), Hungary (10 million), and Slovakia (5.5 million).
However, the V4 countries are still poorer than the founding members. Interestingly, Slovakia reports only 52% of gross domestic product (GDP) per capita in purchasing power standards (PPS) of the Netherlands in 2021. But while the Netherlands and other countries’ GDP per capita have been rising in PPS terms, Slovakia’s has held stable over the last seven years. This means that Slovakia has gotten relatively poorer with respect to all covered countries. In short, the V4 countries are still catching-up to richer EU countries.
