It’s time to think about the future of the European economy – not just that of the European Union, which is a recent political concept and currently is under strain. Rather, let’s think of the whole continent, including of course the UK, but also crucially Russia. Remember, too, that Europe’s largest city is Istanbul, for Europe stops at the Bosporus as well as the Urals.

There are of course huge differences of language, culture and politics, but every continent encompasses huge differences. And as anyone who travels much across the continent will appreciate, there is a certain commonality in the way people live, talk and eat that sets Europe apart from the Americas, Asia or Africa. And most of us have, by world standards, a pretty good life.

There lies the challenge facing all of us over the next few decades. How do we maintain and improve both our living standards and our quality of life in an increasingly competitive world, and without imposing too heavy an environmental footprint?

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The European economy (including Russia) is now smaller than that of the United States, whereas it was larger 30 years ago. Soon it will be smaller than that of China. The reason is partly demographics – we are ageing faster than most of the rest of the world, bar Japan. But it is also that there is less scope for catch-up – the main driver of growth in China and increasingly India – and more worryingly, Europe does not seem to be innovating as fast as North America or East Asia.

If that last sentence jars, think of the device on which you are reading these words. It will not have been made in Europe, and if you want to share them, you will not be using a European social network to do so.

So, what can we say about that challenge? I don’t think we should be pessimistic, just realistic.

For a start there is, within Europe, a huge pool of talent. Sadly, too much of it moves to the US, and that is something we have confront. Take the Nobel Prize in Economics. Angus Deaton, who won in 2015 is Scottish; Esther Duflo, who won this year is French. Both developed their careers in America. Or at a rather different level, look at David Miliband and Sir Nick Clegg, two of our most talented politicians, now both in the US. Saying that the money is there (which it is) is an inadequate answer. Retaining and developing European talent is a top priority.

Next, Europe has to build on what it is good at. It is good at an enormous range of different economic activities. It has the second largest car maker, VW; the largest aircraft manufacturer, Airbus; the largest luxury goods form, LVMH; five of the top 10 universities in the world on the QS ranking, Oxford, Cambridge, ETH Zurich, Imperial and UCL. It has very large oil and gas producers. And so on.

Europe is also a leader in environmental technologies. This is not the place to go into current concerns in detail. This is just to observe that as those environmental concerns rise, as they will, Europe is arguably the region best placed both to lead and to benefit from the efforts to reduce carbon emissions.

Finally, we should remember that other parts of the world face headwinds. What is happening in China is fascinating, for it is not only hit by the cyclical downturn that affects us all, but also in running into structural difficulties. Its underlying growth rate is declining and its response of the past – to generate demand by building more infrastructure – is no longer working as well as in previous cycles. You have to need the stuff you are building, or you end up with unserviceable debts.

The big point here is that Europe could do so much better with leadership that focuses on economics rather than politics. But this is not just about economics or politics. It is also about ideas of how societies can work better together.

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I have just been reading The Human Odyssey, a new book by Stephen Green, the former banker and trade minister. In the book Lord Green charts the history and strengths of Eurasia, the way in which our smaller part of the world’s greatest landmass has interacted with the more populous part of that landmass, Asia. Asia has 60 per cent of the world’s population, and will share with North America the dominant part of the world economy. He asks:

“The great question is how the irreversible fact of urbanisation will nurture the growth of human individuality in every society, such that the wisdom of others transforms and enriches all those great Eurasian cultures.”

These past months have been difficult for Europe, and will continue to be so. So, let’s call for some wisdom to enrich not just our economies – though we have to do that – but also our cultures.

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