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Brexit: Any light at the end of the tunnel?

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Adding a new twist to the divisive issue of the timetable and terms of Britain’s withdrawal from the European Union, UK Prime Minister Theresa May has asked the EU to postpone Brexit until June 30, 2019, the BBC reported.

In a letter to the EU leadership, May said that the proposed delay would give the British parliament more time to agree a Brexit deal to prevent Britain from crashing out of the bloc. She added that London would try to leave the EU before the May 23 elections to the European Parliament.

The situation has thus become absolutely confusing. In an effort to break the current logjam, Theresa May recently engaged in unprecedented direct talks with the opposition Labor Party. Meanwhile, the European Union has reiterated its refusal to make any further concessions to London by making it clear that it would only agree to postpone Brexit until May 22 (which is currently being considered in London as a compromise option) if the British House of Commons approved earlier rejected withdrawal options put forward by Theresa May, before April 12. If not, the UK would have to leave the European Union on that very day without any agreement.

According to The Guardian, the discussions Theresa May had on the subject with Labor Party leader Jeremy Corbyn on April 3, centered on thrashing out an alternative Brexit plan May was to present to the leaders of the EU member countries during the April 10 summit.

The May-Corbin parley was preceded by a Cabinet meeting on April 2 and a televised address to the nation, which May made later that same day, saying she was ready to cooperate with Labor and essentially opted for a softer version of Brexit, which, among other things, would keep Britain in the EU Customs Union and in the common trading area (the so-called “Single Market 2.0”). 

Teresa May promised that if the talks with the Labor Party did not work out,  she would implement the legislators’ will and act as they decided.

Commenting on the outcome of the Cabinet meeting, May said that even though the UK is ready to leave the European Union without a prior agreement, an orderly Brexit based on a treaty would better meet the country’s interests.

“This is a decisive moment in the history of these islands, and it needs national unity to deliver the national interest,” she reiterated.

Theresa May is working hard to avoid Britain’s participation in the May 23-26 elections to the European Parliament. According to EU legislation, each member of the bloc must be represented in parliament, and, as confirmed by European Commission President Jean-Claude Juncker, if the United Kingdom does not leave by the end of May, it will be obliged to take part in the European elections.

Still, no matter how strongly the British government may hope, London will be preparing for the May vote in the event of an emergency, Bloomberg reported, citing its own sources.

Theresa May’s readiness to make concessions despite her previous promise to step down as a condition for approving a previously agreed deal with the EU is dictated by a clear realization of the hard fact that there is virtually no other politician in the UK ready to take responsibility for finding a generally agreed way out of the current impasse, if, of course, this is possible at all. Meanwhile, it looks like no one in London has any desire to “rake the rubble” of this controversial and risky project. That being said, however, all parties have their own opinion on this subject and influence it each in its own way.

With the situation unfolding as it is, the opposition clearly felt it could score additional points and extract new concessions from the prime minister. In an official statement, the Labor Party stated that during the negotiations the parties had “agreed a program of work between our teams to explore the scope for agreement.”

However, in an interview with Sky News, Jeremy Corbin said that although during their meeting he and Teresa May had presented their own positions on Brexit, a series of additional meetings would be required to coordinate these positions.

Mr. Corbyn described the meeting as “useful but inconclusive,” adding that “there has not been as much change as I expected.”

“I put forward the view from the Labor Party that we want to achieve a Customs Union, and that we want to have access to the (EU) market,” he added.

Jeremy Corbin also said that he outlined the party’s position on the possibility of holding a second public vote on Brexit in order to prevent a “no deal” withdrawal from the EU, which would have dire consequences for the country’s economy. He added that Prime Minister May was seeking Labor’s support for the government’s draft agreement pertaining to the terms of Brexit as well as for the political declaration attached to it.

Meanwhile, Theresa May has been faced with increasingly strong criticism from hard-line Tory Brexeteers for softening her initial position.

“It is very disappointing that the cabinet has decided to entrust the final handling of Brexit to Jeremy Corbyn and the Labour Party. It now seems all too likely that British trade policy and key law making powers will be handed over to Brussels – with no say for the UK,” tweeted former Foreign Secretary Boris Johnson.

“I think the result will most certainly be that Corbyn has his way and we remain in the Customs Union, so that we can’t control our trade policy,” he insisted.

Essentially, Theresa May “has once again drawn a line between the agreement on withdrawal and the political declaration on the UK’s future relations with the EU,” the head of Europe Insight research company Andrei Kulikov noted. He believes that if the sides manage to agree on something, it “will be written down only in the declaration. Therefore, exactly how this will help enlist the support of those who reject the agreement itself is hard to tell.”

“If May keeps piling pressure on Corbyn to support her deal, then they will hardly be able to reach agreement. Parliament will then most likely demand a longer delay and the government will have to go along,” he continued. If the prime minister comes up with a new proposal, for example, one of the alternative plans, then perhaps the Labor Party’s leader will be satisfied, Kulikov observed.

“There will be a lot of political horse-trading, and chances are that the sides will eventually come to terms as they have shared interests, including in avoiding early elections,” he noted.

The EU leadership, wary of the negative financial and economic impact of the continuing uncertainty about the principles and timing of Brexit, has taken a particularly hard stand on the issue, with European Commission President Jean-Claude Juncker insisting that a postponement until May 22 is possible only if Britain’s House of Commons endorses Theresa May’s previously rejected Brexit plan before April 12. The Guardian warns that many European leaders fear that London will not be able to clinch a consensus by that deadline, resulting in a “chaotic” Brexit happening right ahead of the upcoming elections to the European Parliament.

According to the newspaper, any compromise with Jeremy Corbyn is fraught with Theresa May abandoning some of her “red lines,” including Britain’s participation in the EU Customs Union, which is just contrary to what the Conservatives promised.

Commenting on Theresa May’s position, EU Council President Donald Tusk stresses the point that now is too early to judge whether her plan to reach a compromise on Brexit will succeed. Danish Prime Minister Lars Lokke Rasmussen said that the EU could agree to postpone Brexit only if the UK parties found a realistic way out of the European Union. He added, however, that it this would be “hard to believe.”

The financial and economic implications of Brexit – all the more so of a “hard” one without any real transitional period and agreed mechanisms – are probably the key factor explaining the actions of all the main participants in this process – including of the United States. President Donald Trump initially supported Brexit and during his meetings with Teresa May he, in keeping with his own business mentality, invariably tried to prod her towards making quick and radical steps. Britain’s exit from the EU without keeping in place existing mechanisms of trade and customs interaction would effectively undermine the country’s position in world trade and push it towards signing a bilateral trade deal with the US from a position of a weaker partner. Simultaneously, the political and economic weakening of the EU resulting from Brexit, would similarly benefit President Trump and his associates in the White House and on Wall Street.

In an interview with The Financial Times, Mark Mobius, formerly the  managing director of Templeton Asset Management, said that the UK increasingly resembles an “emerging market” and risks a currency crash should it leave the EU without a deal next month. According to Mobius, if British politicians fail to prevent an abrupt exit from the EU, the pound would tumble to parity against the dollar and Britain’s credit rating would be cut.  Sterling tumbled more than 10 percent immediately after the 2016 poll and has since traded at an average of about $1.30 against the US dollar, Mobius noted, warning that emerging markets may suffer from a “hard Brexit” as well.

It should also be borne in mind that the crisis around Brexit is unfolding against the backcloth of yet another negative factor for the European and world economy, namely the inability of the United States and China to clinch a trade deal. The document was expected to be inked during President Trump’s meeting with his Chinese counterpart, Xi Jinping, in late March. US-Chinese differences linger on though, and Washington now expects bilateral trade talks to be pushed back to summer. Sources say that China is in a better position and is not going to give in and although it really wants a good deal with the US, it still knows that Donald Trump may be needing it even more.

The existing situation gives a reason to expect further consultations between London and Brussels to try to avoid a “hard” Brexit and, at the same time, resist US pressure on the negotiating sides (above all Britain) to fast-track the Brexit process. Now it all depends on the EU’s response.

 First published in our partner International Affairs

Peter Iskenderov, senior research assistant at RAS Slavic Studies Institute, candidate of historical sciences

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Smile Diplomacy: From Putin to Macron

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Photo:kremlin.ru

In the world of politics, what should be done when things don’t go according to plan? The answer of Talleyrand, the French politician of the 18th and 19th centuries, was simple: organize a conference!

Perhaps it is due to this lesson from the French politician and diplomat that Vladimir Putin held his conference under the title of “Economic Boom of the East” in the port of Vladivostok, and French President Emmanuel Macron is going to start his conference under the title of “Political Council”, Europe” next month in Prague, the capital of the Czech Republic.

Let’s talk about Putin first. No matter how we look at it, the course of things is not as intended. The war in Ukraine is practically frozen in a north-south line. The pitched battles, the use of heavy artillery, the high casualties, and the ever-increasing logistical problems are more reminiscent of the First World War, or even the Crimean War than modern 21st-century war.

Last week, the first sign of Putin’s desperation to fully win this war appeared. In a short televised address, the Russian president claimed that his goal was to preserve the “Russians” of the Donetsk and Luhansk regions. In other words, it has moved away from its initial portent of removing Ukraine from the map as an independent country. Is he now calling for a limited deal that would put parts of eastern Ukraine under Russian control forever, if ever? No one knows the answer to this question, except maybe Putin himself. But, surprisingly, neither Volodymyr Zelensky, the president of Ukraine, nor his American and European supporters have shown any attention to this possible retreat of Putin.

Failure in the war is not Putin’s only concern. Contrary to his claim that Western sanctions have not affected the Russian economy, it can be seen that things are not going as planned on that front either. Of course, Russia has been able to find new customers for its oil—customers like India, China, and Turkey, which have reduced their purchases from Iran and Iraq by receiving significant discounts to take advantage of the Russian auction.

However, double-digit inflation, the closure of hundreds of factories, widespread shortages of many goods, a 25 percent drop in viewership of Putin’s state television, and the flight of tens of thousands of middle-class citizens show that the sanctions are having little effect.

The Vladivostok conference was formed with the slogan “The future is from Asia”. Putin’s message was: “Asia builds the future, while the West falls.”

Of course, we heard this slogan in the 1950s, during the last years of Stalin’s rule over the Soviet Union. Stalin spoke of “Young Asia and the West of Fertut”. Today, Putin plays the same music with notes from the Tsarist Imperial Symphony added.

According to Khmiakov, the Pan-Slavist guru, Russia is a “two-headed eagle”: one head looks to the East and the other to the West.

In the beginning, the double-headed eagle was the symbol of the kings of Hayatele in Asia Minor; But after a few centuries, the Byzantine emperors usurped it. In 1471, Ivan III, Tsar of Russia, married Princess Sophia, the daughter of the Byzantine Emperor, and the symbol of the double-headed eagle was assigned to Russia. Today, Putin is bringing this symbol, which was abandoned during the Soviet Union, back to the scene.

However, an eagle facing east is nearsighted. Out of 49 Asian countries, only 17 countries appeared seriously in this game. None of the heads of Asian countries were present at Putin’s show. The highest-ranking foreign personalities were the Prime Ministers of Armenia and Mongolia. General Ming Aung Heliang, the leader of the Myanmar (Burma) coup plotters, was also present. But China was represented by Li Zhangsu, the third leader of the Communist Party. Even the leader of North Korea, Kim Jong Un, did not accept the suffering of a trip to Vladivostok. Major Asian economic powers such as Japan and South Korea, or even Taiwan, were not present.

Putin’s hope is to develop the “Eurasian” bloc, which was formed years ago to compete with the European Union, but it never got anywhere. However, even if the participants in the Vladivostok conference were to join the bloc, they would collectively account for nearly 20 percent of global GDP. Currently, almost all of them are closer to the European Union and the United States than to Russia in terms of foreign trade. Russia’s own share of trade with bloc countries does not exceed 12%.

From any angle, the Vladivostok gathering is one of those shows that are referred to as “posturing” in the diplomatic dictionary. In this show, the host appears as the leader of a large group, but in reality, there is no group. The choice of Vladivostok, which means “ruler or emir of the east”, maybe a coincidental sign of Putin’s illusions to lead Asia.

It is interesting that in Vladivostok there was no mention of the war in Ukraine. None of Putin’s entourage was wearing a T-shirt with the letter Z, and his bulletproof car did not have a Z mark.

The participants of this show undoubtedly know that Moscow is closer to Berlin than Vladivostok and whatever the underbelly of history, Russia’s national and cultural orientation is to the West, not to the East. Alexander Herzen, a 19th-century Russian writer, wrote: “Russia looks to the East to remember what dangers threaten its existence, and looks to the West to find out how to neutralize those dangers.”

Currently, Putin is not the only leader who is trying to polish his political image by playing the conference game. French President Emmanuel Macron is also busy organizing Smile Diplomacy. The Prague conference for the formation of the “Political Council of Europe” is a platform for introducing Macron as a strong European leader. With Britain mired in crisis, Germany governed by a floundering coalition government, and Italy on the brink of an election with uncertain results, Macron hopes to present France as the anchor of Europe’s stormy ship.

Macron’s failure to win an overwhelming majority in the parliamentary elections has limited his possibilities to exert power in the domestic political scene. Therefore, like many politicians in a similar situation, he turns to show his power in the foreign policy scene.

But Macron’s show, many analysts believe, will not have a better result than what Putin achieved in Vladivostok. In a sense, Macron’s show may even be harmful. Trying to prevent Turkey’s participation, under the pretext that a large part of Turkey is located in Asia, can deepen the gap between Western powers and Turkey.

Turkey’s exclusion from the Prague show could help re-elect Recep Tayyip Erdogan as president. Using an anti-Western discourse and being closer to Russia along with claiming to be the leader of the Islamic world, Erdogan is trying to distract Turkey’s public opinion from its failure in economic and social fields. In the last two decades, this is the first time that Erdogan is on the verge of an electoral defeat. Macron’s anti-Turkish stance could be a bitter irony that guarantees Erdogan’s victory.

Macron’s proposal has other disadvantages as well. First, one should ask what is the need for another “conference” in Europe. Aren’t the “European Security and Cooperation Organization” and “Council of Europe” which include all countries of the continent enough? After all, didn’t Britain leave the European Union under the pretext that it does not want Europe to participate in the regulation of London’s policies? Is the “Brexit” government willing to participate in a new grouping, with unknown goals and criteria, after leaving an established union with clear goals?

Currently, a growing trend across Europe, from Poland to France, is to move away from continental groupings. Even the European Union has lost some of its legitimacy and popularity at this time. The growing trend in most European countries is towards limited nationalism within the borders of each country, emphasis on national sovereignty, and striving for self-sufficiency. In other words, the globalism of the past two or three decades is receding and bilateral relations are becoming more acceptable.

You might say that Smile Diplomacy in Vladivostok or Prague wouldn’t hurt anyway. Unfortunately, this assessment of yours is not correct. Smile Diplomacy masks the fact that Russia and Western Europe do not currently have the ability or will to emerge from the crisis caused by war, economic stagnation, inflation, and environmental threats. Smile Diplomacy offers sideshows instead of serious policies.

Dramatic games allow Putin to mask his failure on the battlefield. On the other hand, Macron and other European leaders hide their inability to stop the war in Ukraine with the Prague show. Both sides are still dreaming of “victory”. Unaware that war never has a winner, because in every war both the victor and the vanquished will be losers in the end. Zelensky seems to think that defeat is better than surrender because it at least offers the badge of hero and martyr. On the other hand, Liz Truss, the new British Prime Minister, speaks of “victory”. The demonstrations in Vladivostok and Prague prevent these irresponsible positions from being seriously discussed.

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In a Crisis-Laden World, Serbia Should Think Green

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Countries around the globe are facing persistent economic headwinds. Trade and supply chain disruptions resulting from the Covid-19 pandemic, the war in Ukraine and extreme weather, have led to surging food and energy prices. Inflation is increasing at an alarming rate in many countries and economic growth is slowing. Policy makers around the world face difficult challenges and complex trade-offs. They need to maintain fiscal sustainability and rebuild economic buffers depleted during the pandemic; but also cater for the needs of the most vulnerable, who feel the impact of higher food and energy prices. As winter is approaching, countries in Europe are scrambling to secure sufficient energy supplies to keep homes warm and factories running. In this challenging context, the urgency of actively expanding renewable sources of energy, pursuing greater resource efficiency, and transitioning away from energy and emission-intensive industries is greater than ever.

Growth outlook

The World Bank expects global economic growth to slow in 2022 to 2.9 percent, from 5.7 percent in 2021. A small and open economy like Serbia will feel the impact of the global slowdown. For Serbia, in 2022, we project an economic growth rate of 3.2 percent, following a 7.4 percent expansion in 2021. Serbia is equally feeling the impact of rising inflation: the NBS expects an inflation of nearly 14 percent in the third quarter of this year.

Higher energy prices have put pressure on current account balances for energy importers around the world. Serbia has also been affected. Its utilities have incurred exceptionally high costs of importing electricity and natural gas on the wholesale markets. While the government has financially supported these companies, it has so far only partially passed these additional costs on to consumers.

Mitigating the impacts of the energy crisis remains the biggest challenge for the new government. Serbia entered the current crisis in a strong macro-fiscal position, but fiscal space is limited. Short-term measures to support households and small and medium enterprises will need to be targeted, time-bound, fully budgeted, and transparent.

Despite the pressures, it is essential that policymakers do not lose sight of structural reforms that would boost Serbia’s potential rate of economic growth over the medium-term, including steps to increase market competition, reform state owned enterprises, raise human capital and productivity, and improve the efficiency of public spending.

Green Serbia

Sustaining long-term growth and resilience also requires putting the ‘green agenda’ at the center of policymaking. The country can do more to increase energy efficiency and lessen the impact of pollution on the health of people and the environment. Staying ‘brown’ runs the risk of slowing down Serbia’s accession to the EU, compromising access to finance, creating trade barriers, limiting the take up of modern technology, and failing to boost productivity. Going ‘green’ would be beneficial on all these fronts. It would also facilitate the structural transformation of the economy through the adoption of new technologies and knowledge. All this will require measures to facilitate a ‘just transition’ for workers and communities who depend on polluting industries for their livelihoods.

Serbia is a signatory to the Paris Agreement under the United Nations Framework Convention on Climate Change, aiming for a climate neutral world by mid-century. The Government recently published its updated Nationally Determined Contribution under the Paris Agreement, pledging to cut greenhouse gas emissions by 2030 by 33.3 percent compared to 1990.  Accompanying plans and strategies are under preparation, but the direction of travel is clear: Serbia urgently needs to boost domestic renewable energy production, increase energy efficiency, and gradually lower dependency on fossil fuels, especially coal and oil, for power generation, heating, and transport.

The World Bank is supporting Serbia’s progress on all these fronts both through financial and technical assistance.

Op-ed originally published in Kurir daily via World Bank

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Media-saturation challenges trust in European democracy

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BY KEVIN CASEY

Media is this layer that exists everywhere in our lives’, said Dr Tanya Lokot as she explained the term ‘mediatized’ to Horizon Magazine. It gives her the title of the seven-country research project she leads from the School of Communications, Dublin City University (DCU).

‘It’s not just something we do for an hour or two.’ We are drenched in media. In our personal, work, social and family lives, media has a meaningful role to play.

MEDIATIZED EU is examining the role of media in society and how it influences people’s perceptions of the EU and the European project. It does so by analysing media discourses in the EU Member States of Ireland, Belgium, Portugal, Estonia, Hungary, Spain, and non-member Georgia.

The researchers are monitoring and assessing the media coverage and conversations which mention European democracy and the European Union in the target countries of the study. ‘We wanted to investigate how people think and form beliefs about the EU. How do people become Europeanised? What does it mean to be more European or less European?’ said Dr Lokot.

‘Putting all of these countries together and looking at how different but also how similar the concerns are among policymakers, among media professionals, among the public has been really enlightening for us,’ she said.

Public conversation

When 90% of the EU’s population have access to the internet, media is ubiquitous. TV provides 75% of Europeans with their news. Altogether, taken collectively, all the media devices in the world create something intangible, a public conversation, which enables opinions to be formed and exchanged.

‘In a way, media are co-creating the space where people come to interpret what it’s like to be living in Europe, what it means to be European, to share European values and to be part of the European Union,’ said Dr Lokot.

The first step in learning to live with our media-saturated environment is to ‘acknowledge that media, not just social media but any kind of media, play an extremely important role in societies,’ said Dr Lokot.

From the research so far, the sense is that the idea of Europe is “a constant work in progress”, and perceptions of Europeanisation are shaped by media, as well as by political elites and public opinion, Lokot revealed. There is also widespread concern about the spread of disinformation. Alongside constructive discourse, the media has plenty of room for promoting extremism and polarising views.

People in every EU country have sophisticated concerns about the risks of media manipulation. ‘They understand the connection between disinformation that is being spread by malicious actors in the media and the threat to democracy,’ said Dr Lokot.

Spiral of cynicism

Populism and media manipulation can lead to a ‘spiral of cynicism’ in any media debate. As a result, even in countries with high levels of trust in media such as Ireland, Spain and Portugal, people often don’t know where to place their trust.

‘It’s because the way disinformation works has also changed,’ said Lokot. The new type of information warfare doesn’t try to persuade or convince people, but sets out to destroy public trust. It works to convince you that ‘there is nobody here who will tell you the truth,’ according to Dr Lokot.

Generating mistrust originates with outside actors but also from within the EU at times. In this climate, people ‘stop believing that a ‘European idea’ that unites people exists, and then they become lost,’ said Dr Lokot.

‘Once you stop believing in some sort of shared values, you don’t really know what else you have in common with these people who are living on the same continent with you.’

While each country has specific topics of concern, one major new trend unites them all. ‘Until Russia’s full-scale invasion of Ukraine in February 2022, Georgia and Estonia were much more concerned with Russian disinformation than the other countries in our project,’ said Dr Lokot.

‘Since February, concern has gone through the roof everywhere.’

The disinformation campaigns targeting Estonians and Georgians, along with their Ukrainian neighbours, insinuate that they were better off under the Soviet regime, that the EU is weak, they belong to Russia’s sphere of influence and not the European community. The conclusion of that thought process is stark.

‘Now we get to the point where not only is Ukraine, for instance, being told, you’re not a European country, they’re being told you’re not a real country at all,’ she said. ‘You’re actually part of Russia and nobody cares about you if you stop existing,’ said Dr Lokot.

‘We’re seeing such escalation of disinformation narratives across the region.’

Doomscrolling

But should people exercise personal responsibility for their media activity? Consuming the news of terrible events over endless hours of ‘doomscrolling’ has been identified as unhealthy behaviour.

The constant barrage of news and disinformation hits home for Dr Lokot who is a Ukrainian native working in DCU in Ireland for the past seven years. ‘I’m Ukrainian and I’m living in the EU. So, you know, I’ve been doing nothing but doomscrolling not just since February, but actually since 2014 because my country has actually been at war much longer than just for the past six months,’ said Dr Lokot.

A constant stream of bad news is exhausting ‘and so it’s also about how we structure media diets,’ said Dr Lokot.

Might there be a need for social media companies to make their algorithms more transparent?

Businesses like Meta who own Facebook, Instagram and WhatsApp need to create a space where people can access information and exchange opinions in a healthy, constructive way, argues Dr Lokot. ‘They need to realise the impact that the media ecosystem has on people and on people’s lives,’ she said.

Online citizens

Good online citizenship where you verify sources and reserve some amount of scepticism over content is important in a democratic environment. Regulation also has a role to play with, for example, laws about transparency in political advertising.

It’s not about control or unrestricted access either. ‘We want people to understand that as citizens, they have rights, they have responsibilities, but they also have agency,’ she says.

The next step is to conduct in-depth research into the other elements of the triangle MEDIATIZED EU has identified as composed of a relationship between citizens, media, and the elites. Speaking to media editors and policy makers, as well as conducting public opinion surveys, the researchers will seek to understand the media’s role in shaping perceptions and opinions of the EU from their points of view and how everything is connected.

The research could help to inform policy makers at every level. Thinking ahead, the imaginary ideally informed EU citizen of 2035 could be living in a media environment with a more democratic flow of information – one which leaves little fertile ground for disinformation. Hopefully, ‘we will also be living in a Europe that is much less polarized than it is today,’ Dr Lokot concludes.

This article was originally published in Horizon, the EU Research and Innovation Magazine. 

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