Leadership, decision-making and governance in the EU and East Asia: crisis and post-crisis

Abstract

The global financial crisis of the late 2000s has affected the EU and East Asia differently. The EU has seen its economic, political and social structures undermined by the problems derived from the global crisis and subsequent eurozone sovereign debt crisis. In contrast, East Asia has gone through the global crisis relatively unscathed and has seen its standing at the global level reinforced. As a result, there has been a reconfiguration of leadership, decision-making and governance structures in both regions. In the case of the EU, Germany has emerged as the clear leader of European efforts to solve regional economic problems. Meanwhile, intergovernmentalism has replaced supranationalism as the decision-making and even implementation procedure of choice. Differently, there is no single leader in East Asia. China has become one of the most important powers at the global level, but at the regional level, different countries have shaped East Asia's response to the crisis. Concurrently, there has been some move towards increasing integration, even though intergovernmentalism still defines governance structures in the region. Thus, the global financial crisis of the late 2000s has helped to shape new leadership, decision-making and governance structures in both regions.

Explaining Political Leadership: Germany's Role in Shaping the Fiscal Compact

“…All these features apply to Germany's role in shaping the Fiscal Compact. Firstly, Germany occupies an extraordinary position of authority among EU member states that is based on its economic power resources (see also Pacheco Pardo, ; Mayhew et al., ):

As the dominant economy and key creditor state Germany could […] scarcely avoid a hegemon role. […] The ESM, for instance, in case of difficulty envisages being able to call on designated funds from Member States.

…”

“…All these features apply to Germany's role in shaping the Fiscal Compact. Firstly, Germany occupies an extraordinary position of authority among EU member states that is based on its economic power resources (see also Pacheco Pardo, 2012;Mayhew et al, 2011): Especially with regard to the Fiscal Compact, observers acknowledge Germany's role as a leader (Ludlow, 2012;Beach, 2013;Toyer and Taylor, 2012). Secondly, the Fiscal Compact not only served Germany's needs but was also in line with the common goal of preserving the euro and overcoming the crisis.…”