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The Asia-Europe Economic Forum: Hosting in St. Petersburg

Introduction

The ongoing economic crisis associated with COVID-19 is causing billions of dollars in economic losses to all countries in the world. This problem is exacerbated by political confrontations between the East and the West, with major players like Russia, China, Europe, and the US splitting up into spheres of interest despite the benefits that economic globalization and integration had been offering for the past several decades. Nevertheless, the recovery from COVID-19 effects on the world economy would require a coordinated effort from all major nations. The collective West is one of the major markets and producers, China is the world’s production plant, and Russia is a bridge between the two, being the country in control of the northern shipping route, the direct railway from Europe to China through Vladivostok. In addition, the country itself is a major market and a supplier of various raw materials and energy resources to Europe, being central to its energy and provisional security. The purpose of this paper is to propose the Asia-Europe Economic Forum (AEEF) to be held in St. Petersburg, Russia.

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Choice of the City: St. Petersburg

St. Petersburg is the largest northernmost city in the world. With a population of over 1 million people and the area of 600 square miles, it has held the title of the Capital of Russia several times throughout its history (Dyatlov, Lobanov, and Zhou 2018). It is a port city with access to the Baltic Sea, and is a transportation hub for the northern cities in Russia, as well as for trade routes from countries like Finland and other Baltic states. The city is the 4th in the country’s collective GDP with a contribution of 2.652 trillion rubles (Dyatlov et al., 2018). It houses major production facilities including shipbuilding, radio construction, military production, fishing, medicine, metallurgy, printing, publishing, and sales.

Besides being an important center of commerce and trade in Russia, and a major connector between itself and Europe, the city of St. Petersburg has traditionally been a major cultural center for the country. European influence has always been strong here, with many European tourists seeking to visit the city, with over 8 million tourists visiting on a yearly basis, half of which coming from Europe (Kolesnikova et al. 2019). In addition, St. Petersburg is no stranger to economic forum activity – it has a 24-year history of housing the International Economic Forum, with latest one having been held on June 5th, 2021, loudly advertised as some of the largest economic forums to have been held face-to-face since the start of the COVID-19 pandemic (Kolesnikova et al. 2019). The city is a recognizable icon on the international arena, with a strong infrastructure and a number of airports to service the guests and spectators of the AEEF forum.

Choice of the Event: Asia-Europe Economic Forum

The AEEF is an economic forum established in 2006 in order to assist with the integration and linkage between European and Asian economies (Koh and Kwok 2017). Its purpose is to serve as a high-level platform for government leaders, economics professionals, experts, and business people to have in-depth research-based interactions on global issues that affect the world economy. Since 2007, these meetings have occurred in Europe and Asia, with the subjects of conversation being the economy, cooperation and coordination, and the presentation of research papers dedicated to evaluating the outcomes of various policies in both regions (Pepermans 2018).

So far, under the mandate of AEEF, there have been 8 major conferences addressing the challenges and prospects for European and Asian economies, economic reforms, macro-economic policy coordination, global partnerships and challenges, and global change. Some of the cities that housed these conferences have been Berlin, Brussels, Seoul, Beijing, Paris, and Tokyo (Ghosh 2020). Some of the organizations participating in the AEEF include Asian Development Bank Institute, Bertelsmann Stiftung, Korea Institute for International Economic Policy, and Peking University HSBC Business School, among others (Crecente-Romero et al. 2019). Despite covering a significant landmass and controlling one of the potential sea-faring supply routes between China and Europe, Russia was never before present in the AEEF.

PESTEL Analysis of the City and Country

The following analysis in regards to the AEEF will focus on St. Petersburg as a location and as a part of Russia as a country, which imposes significant benefits and issues both on the scope and success of the AEEF mission, which is to facilitate interaction between different economic actors in Europe and Asia alike. The selected PESTEL model stands for Political, Economic, Social, Technological, Environmental, and Legal factors that may affect the outcome of an activity (Thakur 2021).

Politically-speaking, AEEF may have a plethora of advantages and complications. Some of the advantages would include involving Russia – a superpower and a massive political entity with influence on both Europe and Asia, in a constructive dialogue. Such a motion would be an excellent step to re-integrating Russia with the rest of the world economic system, influence its political development in a globalist and free-market way, while smoothening out some of the issues currently existing between Russia and Europe (Barhatov et al. 2018). In fact, this forum can be used as a platform for diplomacy and economic dealings alike, promoting goodwill and cooperation between different parties. Political issues with choosing St. Petersburg as a prospective AEEF forum location include the politicizing of the event, its boycott by various European entities (some participants from Poland, Ukraine, and other nations may refuse to participate for political reasons), and the potential upset of the region meant to be hosting the next event (either Europe or Asia).

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From an economic perspective, the choice of St. Petersburg as a location for the next AEEF forum offers plenty of potential rewards. First, it is a well-established economic hub with the potential for integrating the city capabilities into the AEEF agenda. Next, it taking part in Russia will attract numerous regional and state companies, as well as the vast body of academia available, to contribute to whatever solutions are being presented during the forum. Finally, it will allow engaging subjects that Russia can be an instrumental partner in, namely the establishment and management of the Northern Sea Route (see Fig. 1), the trans-Siberian railway, as well as various ecology and economy-related matters, such as emissions and the climate change (Theocharis et al. 2019).

Northern Sea Route
Fig. 1. Northern Sea Route

Some of the issues with the economic part of the proposed assembly is that the choice of St. Petersburg to host the event would invariably draw away from the bilateral nature of previous AEEF meetings by inserting Russia as a third entity into the equation, as it is too big to represent either Europe or Asia.

From a social perspective, the AEEF benefits would include attracting both tourism and economic development to St. Petersburg and Russia in general. Its inclusion in the AEEF format would allow for the regional economy to reap the benefits of participation and positively affect the societies involved. Some of the social issues involved may be connected with COVID-19 restrictions, as some would see the forum as an uncalled luxury during the pandemic (Chakraborty and Maity 2020).

Technological aspects of the choice of location for the AEEF are largely related to the capacity of St. Petersburg to provide space and technology to host the forum and to ensure its safety during the pandemic. As the last St. Petersburg International Economic Forum has been a success, it would not be difficult to adapt to the needs of the AEEF. From a transportation perspective, hosting AEEF in the city would be comfortable for all participants, as it is a major hub for air transport and can receive direct flights from any destination.

The environmental agenda is a very important topic for Europe, Asia, and Russia, as the country has recently been (somewhat belatedly) adopting European practices of managing plastic waste and promoting green energy (Zhukova et al. 2020). As climate change and other ecological issues need to be handled holistically, Russia can benefit from economic and ecological findings presented during the AEEF, and it can be included in the conference. The event poses no significant risks to the environment or the people of St. Petersburg.

Finally, being an economic forum, the AEEF event is easy to set up from a legal perspective. Some of the most pertinent issues would include getting permits to travel to Russia, which may be difficult due to COVID restrictions and sanctions placed upon the country by other governments and countries (Gottlieb et al. 2020). The requirement to produce a test result prior to flying into the country might prevent some participants from arriving on time due to technical difficulties. These matters, however, can be easily overcome with adequate planning. The decisions made during the AEEF would have to correspond to both the local and international legal norms in order to be implementable by all parties.

SWOT of the Event

SWOT analysis of the AEEF event is demonstrated in Figure 2, and focuses on its strengths, weaknesses, opportunities and threats in relation to the chosen city, the country, and the overarching world events (Longhurst et al. 2020).

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SWOT Analysis of AEEF
Figure 2. SWOT Analysis of AEEF

The strengths of the event lie in its potential encompass a whole new market, an important state, and a myriad of state and private companies that could potentially cooperate with both European and Asian businesses, serving as partners and mediators. The event would likely have state backing, as the Russian government is very interested in improving its image and the economy. Lastly, St. Petersburg is a comfortable and worthy location for an event of such a scale. Some of the weaknesses include the increased politization of economic matters. Some countries may find the choice of moving AEEF to Russia as controversial, as the Russian government would use it to improve its public image. Finally, the economic forum, unlike a tourism event, would not bring immediate benefits to the location in question.

Opportunities for the forum include integrate Russia into the international globalization effort, and help improve relations between participants on an economic level. It is a large country with a key geographic positioning, vast resources, and great influence on Asian and European affairs. It would help improve relations between the participants and establish new economic bonds. Finally, it would enable solving problems pertinent to the entire Eurasian continent. Threats to the aforementioned event include security issues associated with COVID-19 and domestic terrorism, the involvement of politics and their overshadowing of economic matters, and active boycotting by some European powers.

Recommendations for Minimizing Negative Effects and Maximizing Positive Impacts

As both SWOT and PESTEL analyses have demonstrated, the majority of the issues surrounding the proposed AEEF forum assembly revolve around the increased politization of the event as well as COVID-related complications, that may endanger the participants. COVID-19 troubles can be dealt in a relatively straight-forward manner, which include following WHO’s guidelines on social distancing, personal protection, air and surface cleanliness, as well as vaccinations (Newman 2021). All participants have to be vaccinated and COVID-free by the time they enter or leave St. Petersburg.

Solving the politicking issues is going to be much more difficult, but not impossible. The AEEF should distance itself as much as possible from potential political issues that may cause turmoil between participants and announce its purpose in St. Petersburg as purely economic. Some questions, like the subject of gas pipeline (Nord Stream 2), Ukraine transit, and other sensitive subjects should be removed from discussion (Hahm and Heo 2019). The forum should focus on economic and policy-making efforts that do not involve geopolitics of competitive nature, and all members will have to agree on the list of subjects to be discussed on the forum prior to attending. Such measures would enable distancing the AEEF from potential points of contention and give the event a purely economic agenda, with the purpose of mutual growth.

Maximizing positive impacts from the AEEF could be achieved by making agreements and offering initiatives that would benefit the European-Asian interaction with the inclusion of Russia as a key partner in economic decisions. The point of placing the next AEEF meeting in Russia is to include a major European-Asian nation that has been excluded from the conversation in previous instances of the forum. As such, the objective of providing a more holistic platform would benefit from making a bigger focus on what that country has to offer to the globalized community. Achieving long-term agreements would show the viability of the AEEF and successful settlement of old trade disputes would increase its authority and popularity among the business circles of all countries involved (Cheng et al. 2017). Some of the unique features that the inclusion of Russia will offer includes the implementation of the North Sea Route and the Trans-Siberian railroad into the European-Asian trade system on a much larger scale.

Conclusions

Hosting the next AEEF event in St. Petersburg, Russia, promises a plethora of opportunities as well as issues that would need to be solved. Should the issues of politics between separate countries be overcome, the inclusion of Russia would greatly increase the potential for creating a more seamless and inclusive economical system between Europe and Asia, with Russia as a transportation hub and an intermediary. The choice of St. Petersburg for the proposed AEEF is motivated by the city’s location, infrastructure, economic position, culture, and history.

Reference List

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StudyCorgi. "The Asia-Europe Economic Forum: Hosting in St. Petersburg." October 1, 2022. https://studycorgi.com/the-asia-europe-economic-forum-hosting-in-st-petersburg/.

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StudyCorgi. 2022. "The Asia-Europe Economic Forum: Hosting in St. Petersburg." October 1, 2022. https://studycorgi.com/the-asia-europe-economic-forum-hosting-in-st-petersburg/.

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