The first decade of the 21st century has been a period of rapid economic growth in many large emerging economies, especially China. This has brought about substantial changes in the relative power balance between the emerging economies and the West. The financial and economic crisis that started in 2007-2008 has reinforced this global shift. While the U.S. and many European economies are weighed down by large sovereign debt and austerity measures that could condemn them to several years of slow growth, many emerging economies are in much better fiscal shape and have recovered quickly from the global recession. Some large emerging economies have even been considered potential creditors for a number of struggling countries in the Eurozone – a situation that would have been difficult to imagine several years ago. These developments have contributed to the (re-)emergence of a debate on the ‘decline of the West'.

Rapid economic growth in emerging economies has had many advantages for Western companies and consumers. For Western firms it has opened up new opportunities for expanding sales and investments. Western consumers have benefited from imports of cheaper consumer goods from these countries. For instance, Germany's strong economic performance in recent years has been closely associated with its strong exports to large emerging economies. Not surprisingly, in a period of economic downturn in Europe there has been substantial interest on the part of governments and businesses alike to reach out to these economies.

At the same time, the growing economic and financial momentum of many larger emerging economies raises serious questions for Western decisionmakers. Spurred, inter alia, by the organization of annual summits since 2009, a central strategic concern is whether (several of) the emerging economies are likely to coalesce into an economic or political bloc (be it formal or informal) that might promote alternative approaches to global economic, diplomatic or security issues and develop a counterbalance to Western influence in existing economic, financial and political institutions. Although the development of counterbalancing forces to Western preeminence is a response to be expected as emerging countries rise – and is in fact predicted by International Relations theory – the extent and pace of this transformation are unclear. In the event that this counterbalancing results in the formation of a bloc of emerging countries, including coordinated challenges to limit Western influence or the development of alternative economic-financial regimes, European interests stand to suffer.