On the 22nd of March, 2016, a coordinated series of terrorist attacks struck Brussels, Belgium, killing over 30 people and wounding hundreds. The attacks hit the terminal at Brussels Airport as well as a metro station in the European Quarter of the city. These are the first major attacks to strike Western Europe since the Paris attacks last November, and as such a number of responses are to be expected from European governments. The threat of future attacks remains present, but companies should not view this as an existential threat to the European Union. Firms can manage the risks inherent to this threat with sufficient planning.
Increased security checks
First, there will be increased security measures at airports, train stations, and metro stations around Western Europe, particularly in France and Belgium. France has already announced that it will be adding additional police patrols and checks at transit hubs, while the State of Emergency remains in place and will likely be extended beyond its expiration in May.
Most of the problem in this particular instance is specific to Belgium, but is representative of problems at the European level. Due to linguistic divisions between Flemish and French speakers, decentralized government, and a myriad of separate and overlapping agencies dealing with security, Belgium has been largely ineffective at sharing intelligence across agencies, which will be critical for monitoring and preventing future attacks before they occur. Belgium will need to address these problems, as will the European Union itself, as intelligence sharing between nations remains insufficient and is another weak spot in European security. The clear failure of France and Belgium to share intelligence on the attackers allowed for these terrorists to carry out the attack before being caught.
Spending and economic impacts
Additional government spending on security (particularly in France), could have a moderate positive impact on the economy. Hiring more agents and police officers, increasing spending on the military (along with continued spending on anti-ISIS initiatives), or any other potential routes to counter domestic radicalization will at least mildly assist employment. However, this improvement is likely to be offset by localized impacts on certain industries reliant on consumer spending, especially tourism; industries like airlines, hotels and accommodation, and restaurants will struggle disproportionately.
Scenarios: A fork in the road for Europe
In recent years Europe has faced a number of crises that have tested European unity more severely than it has been in decades. Terrorist attacks, including the attacks in Paris in November 2015 and in Brussels in March 2016 can exacerbate these strains. Europe is facing a long-term choice over the next several years about which direction to go, whether it will fracture along national lines or whether cooperation and integration will continue.
Tragic security incidents like this always entail a political risk, particularly if mainstream political parties are perceived as failing to adequately protect the public. The perceived failure will fuel support for anti-immigrant, anti-Muslim, and anti-EU populist and nationalist parties like the French National Front, complicating efforts to solve the problem at a European level due to these parties’ increasing influence on policy-making.
Regardless of whether populist parties obtain more power, the likely result of the Brussels attack will be further disunity within Europe, resulting in continued border checks and the erosion, if not complete collapse, of the Schengen Agreement. More specifically, checks along the Franco-Belgian border will assuredly persist as alleged terrorists have traveled across this border repeatedly over the past year.
On the other hand, a more optimistic outcome is possible. Encouragingly, unlike after the Paris attacks, most of the focus thus far has not been on migrants from Syria. Rather, much of the news after the Brussels attacks has placed blame on the failure to adequately share intelligence, whether between agencies in Belgium or between Belgium and France, and on the failure of cooperation that allowed these terrorists to slip through the cracks unnoticed. These failings are legitimate and rectifying this issue will hopefully remain the focus. Populists and nationalists have made the argument that their countries will be more secure on their own. However, a country that makes it harder to access intelligence gathered by other European agencies and institutions would be making itself less secure, not more. This makes it more difficult for Eurosceptic groups to use this issue to their advantage, compared to the migrant crisis issue.
Importance of resilience
With that in mind, it is important to recognize that terrorism will pose a long-term security threat to Western Europe, which can ultimately lead to either re-nationalization or greater EU cooperation. Conventional wisdom since the Paris attacks has suggested the former, but the latter is not impossible and realistically the result will be somewhere in the middle. The response since the Brussels attacks has been encouraging, since the focus has been on greater cooperation.
In responding to the terror threat, companies should consider updating security procedures depending on the location of their offices, factories, and other facilities. Companies should also consider contingency plans in the event of transport disruptions, whether via commercial airlines or trains or increased border checks that slow transit. Terrorism does not pose an existential threat to Europe’s future, and with appropriate planning firms should be able to manage risks accordingly.
Clay Kitchura contributed to this post | Photo Credit