Dark clouds forming east of Berlin

Germany has sponsored the development of Eastern Europe, but now, with its growing economies and nationalisms, the East is looking to the West but not to the European Union

Leaders of Visegrad countries Poland's Prime Minister Mateusz Morawiecki, Hungarian Prime Minister Viktor Orban, Czech Republic's Prime Minister Andrej Babis, Slovakia’s Prime Minister Peter Pellegrini are welcomed by European Council President Donald Tusk in Brussels, Belgium May 28, 2019. Oliver Hoslet/Pool via REUTERS

Germany has sponsored the development of Eastern Europe, but now, with its growing economies and nationalisms, the East is looking to the West but not to the European Union

In 2018 the EU’s GDP increased overall by 2%. However, in Poland it grew by 5.1%, a little more than Hungary (+4.9%), Latvia (+4.8%) or Slovenia (+4.5%). Slovakia grew by 4.1%, Estonia by 3.9%, Lithuania by 3.5% and the Czech Republic by 3%. A fluke? In 2013 the ratio between the European aggregate and the region stretching from the Balkans to the Carpathians was similar, even though the macro-economic outlook was worse: the EU GDP rose by just 0.3%, but the growth in the three Baltic countries hovered between 2 and 3%, in Budapest it stood at 2.1% and in Warsaw at 1.4%. In 2008, compared to a modest 0.5% on a European level, the Czech economy was growing at five times that rate and the Polish one eight times. Despite the usual accelerations and slow downs, local crises and ephemeral booms, the countries between the Baltic and Mitteleuropa have recorded outstanding rates of growth ever since they entered the EU. A well-rooted success with a few dark areas, and considerable political consequences.

For centuries the Hapsburg Empire stood as a model of good administration, and its positive heritage is felt both in the Lombardy and Veneto regions in Italy as much as it is in the Czech Republic, Croatia, Slovakia, Slovenia and Hungary. One needs only take a stroll along the streets of Prague, Budapest or Bratislava to recognise how much care is taken over the urban environment. Further north, as early as the late Middle Ages the Baltic cities were part of the flourishing Hanseatic League developing trade between Finland and the Channel, in a cooperative and mercantile approach that was respectful of local autonomies that looked after their respective communities.

What have the Hapsburg Empire and the Hanseatic League got to do with the GDP of Central-Eastern Europe in the third millennium? What matters here is the cultural and social base which makes the public administration efficient, the society geared towards structural and long term investments and a community ready to interact with its neighbours – particularly those to the West and the North – and which at the same time guarantees a sense of the state and nation as a collective. Even in countries that for a long time have not been part of an independent state, such as Poland, this structure was so solid that it withstood foreign domination while maintaining fertile ground for the social and economic blossoming of the last twenty years. It’s hardly surprising that during the Cold War the reform and protest movements against the Soviet occupation came out of Danzig, Budapest and Prague and not Romania or Bulgaria, which had experienced centuries of Ottoman domination.

Once the Belin Wall come down, two unique and strongly positive dynamics were grafted onto these fertile soils. On the one hand a local leadership determined to become part of the West in every respect, including the market economy, liberal democracy and integration within the EU and NATO, headed these countries during the 90’s and 2000’s. This leadership produced a great effort to draw closer to continental Europe but even more so to the Anglo-Saxon world, with a significant quota of the new management class travelling to the US, the UK and obviously to Germany and elsewhere in the West, before returning with experience, ideas and a network.

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