Christopher Hartwell: “Renewed regional integration could help to push institutional progress, but we need to substantially re-think our ideas of integration”

On October 26th, dr. Christopher A. Hartwell, President of CASE, gave a speech during the international conference “Laying the foundation in the UNECE region for economic integration and sustainable development towards 2030” jointly organized by the Government of the Republic of Belarus and the United Nations Economic Commission for Europe (UNECE) and held in Minsk.

In his presentation “Visions for Prosperity towards 2030: Integration and the Institutional Dimension”, dr. Hartwell examined the challenges for the future of integration of the UNECE region. According to dr. Hartwell, the decades long process of integration in Western and Central Europe has been undermined by political uncertainty and the triumph of populism. Moreover, the breakdown of integration is now coinciding with and contributing to institutional regression. As the countries of Western and Central Europe have turned inward, they are reintroducing and increasing trade protectionism and restrictions on investment. The process of building barriers to free trade and free movement of labour has resulted in declining global trade.

On the other hand, he pointed out, integration in Eastern Europe and the former Soviet Union has greatly accelerated in the past six years. In a relatively short span of time, the Eurasian Economic Union has made great strides in terms of open borders, trade, and capital flows amongst members. Unfortunately, the EaEU has not proven a reason for its existence and has not defined its end goal yet, moving simultaneously in the direction of both deeper integration and broader membership. Moreover, deepening integration of the region has occurred at the same time that the Russian economy has imploded, increasing transmission of economic shocks among members that might not have been as severe if it were not for integration.

Dr. Hartwell turned to discussing a possible role for regional integration in reversing the trend of institutional regression across Europe. He suggested a need to think smaller in terms of “regions” – to focus less on the big idea of grand, “ever-closer union”, and more on the local or cross-border facets of integration, allowing for cross-bloc regional integration, e.g. Poland-Belarus, Kazakhstan-China. Dr. Hartwell also recommended that countries should concentrate on key institutions, such as property tights and trade, which are the key for creating a favourable environment for productivity and innovation.

According to dr. Hartwell, renewed regional integration could help to push institutional progress, so long as it is a liberal integration. In conclusion of his speech, he underlined a need to substantially re-think current ideas of integration to include what can be done at the subnational and cross-border level, to reinvigorate liberal and pro-growth integration at the national and supra-national level and, finally, to build bridges, not barriers.