'Ring of prosperity' to ensure EU globalisation success

Globalisation has benefited Europe and could boost annual household income by €5,000 within a few years, according to a comprehensive…

Globalisation has benefited Europe and could boost annual household income by €5,000 within a few years, according to a comprehensive survey of its effects.

Companies based in the European Union were better placed than their US counterparts to benefit from a "ring of prosperity" around the EU, from Russia to the Middle East and Africa, said the study by the American Chamber of Commerce in the EU.

While there were winners and losers according to sector and region, EU exports, jobs and wages had grown since 1990.

It said some EU countries competing head-on with India and China in low-skilled industries had suffered. Portugal had lost a quarter of its jobs because of reliance on industries such as footwear. While Ireland lost a similar proportion, the jobs had been replaced by alternatives created by US and other companies offshoring into Ireland.

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The report was welcomed by José Manuel Barroso, the European Commission president, who requested the study in a campaign to convince Europeans that globalisation was a positive force.

Daniel Hamilton and Joseph Quinlan, the study's authors from Johns Hopkins University, found several EU countries had adapted better than the US to globalisation.

Mr Quinlan, who is a Wall Street banker, said: "If you look at the EU15 [richer member countries that joined the EU before 2004] . . . you find a ring of prosperity around them."

Russia and countries in the Middle East and North Africa, boosted by high ­commodity prices, were becoming big customers. Former communist countries had also boosted exports, although they are now part of the EU.

"In essence, the EU has its own China right next door. It is about Europeanisation as much as globalisation," Mr Hamilton said.