Gerard Mestrallet, CEO of the French/Belgian energy and water giant, Suez, says, "When I look back, every step of building Europe has been a miracle." It seems, however, that more miracles will be needed to forge one critical element of unity that has yet to emerge—a truly European identity, untainted by nationalism, ethnic rivalry and antagonism.

In fact, Europe is in the middle of an identity crisis. Not only are the people of its constituent parts being asked to subjugate centuries of individuality to the greater calling of a united Europe, the flood of immigrant workers into some countries and the rising tide of refugees and asylum seekers from outside the Union is adding a volatile catalyst to the mix.

Not many would agree with European President Romano Prodi that "we in Europe have found a way to express our regional, national and European identities without undermining any of them." The swing to the political right in France, Holland and Germany in recent times is symptomatic of an unrest simmering, and occasionally boiling over, in some parts of the Union.

The euro has replaced most national currencies, and rules and regulations flowing out of European Commission headquarters in Brussels now seem to affect the lives of 380 million Europeans more than their still-existing national parliaments. Some companies that were sources of patriotic pride, such as Telecom Italia, Ericsson and Kirch, are faltering or falling under the new economic realities of the EU. But such economic and structural challenges will be met. It is the identity crisis, compounded by the immigrants, refugees and asylum seekers, that will be a higher hurdle to clear.

Europe is not yet ready to accept a significant influx of largely non-white, non-Christian residents as full citizens. Adverse economic conditions in Europe at the present time mean that many of these people are unemployed and disadvantaged within cultures that are as foreign to them as their presence is to the European-born citizen. These conditions have resulted in rising crime, violence and racism in many European cities and towns. The move to the right mentioned earlier has been heavily influenced by this unrest.

Recent times have seen attacks on immigrant hostels in Germany, race riots in northern Britain and an anti-France demonstration at a government-sponsored football match in Paris. About 80,000 fans of mostly Arab descent jeered as the French national anthem was played, pelted Cabinet ministers with water bottles and finally charged the playing field. It was a clear indication of the disconnection of immigrants from mainstream French society.

Further polarization is being caused by the Israel/Palestine conflict in the Middle East. This is reflected in outbreaks of anti-Semitism in a largely pro-Palestine European Union, with a significant number of Muslims among the immigrants, refugees and asylum seekers. The memories of anti-Semitism before and during World War II have not faded for many.

The creation of the European Union in the past 50 years, from a diverse base of ethnic, national and cultural identities, has not yet coalesced into a truly European identity. Perhaps, as Mestrallet believes, what has happened to date has been miraculous. More miracles may be needed before Europe becomes the united economic, political and military superpower to rival the British Empire of the 19th and 20th centuries and the United States of the last 60 years or so. Time will tell. Keep developments in Europe on your radar screen.

—Source: Business Week, May 20, 2002.