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The EU’s Open Strategic Autonomy from a central banking perspective - Challenges to the monetary policy landscape from a changing geopolitical environment

Author

Listed:
  • Ioannou, Demosthenes
  • Pérez, Javier J.
  • Almeida, Ana M.
  • Balteanu, Irina
  • Kataryniuk, Ivan
  • Geeroms, Hans
  • Vansteenkiste, Isabel
  • Weber, Pierre-François
  • Attinasi, Maria Grazia
  • Buysse, Kristel
  • Campos, Rodolfo
  • Clancy, Daragh
  • Essers, Dennis
  • Faccia, Donata
  • Freier, Maximilian
  • Gerinovics, Rinalds
  • Khalil, Makram
  • Kosterink, Patrick
  • Mancini, Michele
  • Manrique, Marta
  • McQuade, Peter
  • Molitor, Philippe
  • Pulst, Daniela
  • Timini, Jacopo
  • Van Schaik, Ilona
  • Valenta, Vilém
  • Vergara Caffarelli, Filippo
  • Viani, Francesca
  • Viilmann, Natalja
  • Alonso, Daniel
  • Bencivelli, Lorenzo
  • Borgogno, Oscar
  • Borrallo, Fructuoso
  • Cuadro-Sáez, Lucía
  • Di Stefano, Enrica
  • Esser, Andreas
  • García-Lecuona, María
  • Habib, Maurizio Michael
  • Jeudy, Bruno-Philippe
  • Lájer, Andrés
  • Le Gallo, Florian
  • Martonosi, Ádám
  • Millaruelo, Antonio
  • Miola, Andrea
  • Négrin, Pauline
  • Zangrandi, Michele Savini
  • Strobel, Felix
  • Tylko-Tylczynska, Kalina Paula
Abstract
Over the past decade, geopolitical developments – and the policy responses to these by major economies around the world – have challenged economic openness and the process of globalisation, with implications for the economic environment in which central banks operate. The return of war to Europe and the energy shock triggered by the Russian invasion of Ukraine in 2022 are the latest in a series of episodes that have led the European Union (EU) to develop its Open Strategic Autonomy (OSA) agenda. This Report is a broad attempt to take stock of these developments from a central banking perspective. It analyses the EU’s economic interdependencies and their implications for trade and finance, with a focus on strategically important dimensions such as energy, critical raw materials, food, foreign direct investment and financial market infrastructures. Against this background, the Report discusses relevant aspects of the EU’s OSA policy agenda which extends to trade, industrial and state aid measures, as well as EU initiatives to strengthen and protect the internal market and further develop Economic and Monetary Union (EMU). The paper highlights some of the policy choices and trade-offs that emerge in this context and possible implications for the ECB’s monetary policy and other policies. JEL Classification: F0, F10, F30, F4, F5, F45, E42, L5, Q43

Suggested Citation

  • Ioannou, Demosthenes & Pérez, Javier J. & Almeida, Ana M. & Balteanu, Irina & Kataryniuk, Ivan & Geeroms, Hans & Vansteenkiste, Isabel & Weber, Pierre-François & Attinasi, Maria Grazia & Buysse, Krist, 2023. "The EU’s Open Strategic Autonomy from a central banking perspective - Challenges to the monetary policy landscape from a changing geopolitical environment," Occasional Paper Series 311, European Central Bank.
    • Handle: RePEc:ecb:ecbops:2023311
    Note: 1056819
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    References listed on IDEAS

    as
    1. Lodge, David & Pérez, Javier J. & Albrizio, Silvia & Everett, Mary & De Bandt, Olivier & Georgiadis, Georgios & Ca' Zorzi, Michele & Lastauskas, Povilas & Carluccio, Juan & Parrága, Susana & Carvalho,, 2021. "The implications of globalisation for the ECB monetary policy strategy," Occasional Paper Series 263, European Central Bank.
    2. Yoto V. Yotov, 2022. "On the role of domestic trade flows for estimating the gravity model of trade," Contemporary Economic Policy, Western Economic Association International, vol. 40(3), pages 526-540, July.
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    Cited by:

    1. Alessandro Borin & Gianmarco Cariola & Elena Gentili & Andrea Linarello & Michele Mancini & Tullia Padellini & Ludovic Panon & Enrico Sette, 2023. "Inputs in geopolitical distress: a risk assessment based on micro data," Questioni di Economia e Finanza (Occasional Papers) 819, Bank of Italy, Economic Research and International Relations Area.
    2. Fernando López Vicente & Marta Rodríguez Vives & Juan Rojas, 2024. "Public spending on defence, public order and safety in Spain and the European Union," Economic Bulletin, Banco de España, issue 2024/Q3.
    3. Eichenauer, Vera & Wang, Feicheng, 2024. "Mild deglobalization: Foreign investment screening and cross-border investment," Kiel Working Papers 2265, Kiel Institute for the World Economy (IfW Kiel).
    4. Daragh Clancy & Donal Smith & Vilém Valenta, 2024. "The Macroeconomic Effects of Global Supply Chain Reorientation," International Journal of Central Banking, International Journal of Central Banking, vol. 20(2), pages 151-191, April.
    5. Westermeier, Carola, 2024. "The Digital Euro: A Materialization of (In)Security," SocArXiv x45eg, Center for Open Science.
    6. Zeng, Hongjun & Abedin, Mohammad Zoynul & Zhou, Xiangjing & Lu, Ran, 2024. "Measuring the extreme linkages and time-frequency co-movements among artificial intelligence and clean energy indices," International Review of Financial Analysis, Elsevier, vol. 92(C).
    7. Rodolfo Campos & Jacopo Timini, 2023. "Latin America and the Caribbean: trade relations in the face of global geopolitical fragmentation risks," Economic Bulletin, Banco de España, issue 2023/Q1.

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    More about this item

    Keywords

    capital flows; European Central Bank; European Economic and Monetary Union; financial market infrastructures; financial stability; geoeconomics; geopolitics; globalisation; global value chains; industrial policy; international trade; monetary policy; multilateralism; Open Strategic Autonomy;
    All these keywords.

    JEL classification:

    • F0 - International Economics - - General
    • F10 - International Economics - - Trade - - - General
    • F30 - International Economics - - International Finance - - - General
    • F4 - International Economics - - Macroeconomic Aspects of International Trade and Finance
    • F5 - International Economics - - International Relations, National Security, and International Political Economy
    • F45 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Macroeconomic Issues of Monetary Unions
    • E42 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Monetary Sytsems; Standards; Regimes; Government and the Monetary System
    • L5 - Industrial Organization - - Regulation and Industrial Policy
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy

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