-Analysis-

PARIS — The Catalan flag fluttered alongside the European flag and its 12 stars on Oct. 27, when Catalonia declared its independence from Spain. But Jean-Claude Juncker, the president of the European Commission, didn't appreciate this tribute to Europe. "We shouldn't insert ourselves into what is an internal debate for Spain," he warned. "I wouldn't want the European Union to consist of 95 member states."

Ninety-five is the current number of regions in the EU, according to the NUTS classification (nomenclature of territorial units for statistics). But is Juncker right to worry? Could those regions, in the future, each separate from their respective nation-states?

Catalonia, Scotland, Lombardy, Veneto, Corsica: Separatist movements are gaining ground all over the continent, due in large part to the EU's single market, which safeguards access to trade outlets. On the worldwide scale too, globalization offers a de facto guarantee for broad access. In this sense, wouldn't California, a very international part of the United States thanks to the Silicon Valley and its cosmopolitan communities, stand to gain from being independent from the American federation?

Small certainly can be beautiful — and beneficial. The world's 12 richest countries (if we consider GDP per capita) are all small countries in terms of population. From Qatar to Switzerland, Singapore to Norway, none of those countries has more than 8.5 million inhabitants.

Changing context

Before the French Revolution and the Napoleonic Wars, Europe was divided between more than 300 kingdoms or independent principalities. Just one century later, after the unifications of Germany and Italy, the Old Continent had fewer than 20 sovereign countries. In 1945, the United Nations had just 51 members.

Since then, though, with decolonization and the breaking up of the Soviet bloc, the number of independent states hasn't stopped growing. There are now 193 member states among the United Nations, not to mention a handful of states with special status (Vatican, Taiwan, Palestine, etc.) and some 60 "territories," including tax havens.

Will the 21st century revive the provinces and the principalities of the pre-Revolution era? The liberalization of trade and the abolition of border customs favor the constitution of gigantic multinationals, especially in the technology sector. The GAFA — Google, Apple, Facebook and Amazon — is the perfect illustration of this. But at the same time, globalization makes life easier for Lilliputian countries. And it encourages separatist movements.

One of the strongest arguments used in Britain by the pro-Brexit side — and a favorite of Foreign Secretary Boris Johnson — is that, outside of the EU, Great Britain will be able to negotiate free-trade agreements with any country it wants. Owing to their size, small countries have no choice but to be open, so much so that in Singapore, exports represent 175% of the GDP, calculated as such because the same product crosses the border several times during the manufacturing process.

Regional resentment

Far from being a disadvantage, smallness is an asset: On the one hand, it forces these countries to be flexible — an essential quality in the global market competition — and on the other hand, it strengthens solidarity, making microstates easier to manage.

The first Industrial Revolution, in the 19th century, encouraged the emergence of nation-states. Bismarck unified Germany thanks to industry. In contrast, the new context of globalization and the fourth Industrial Revolution brought about by the digital sector are exacerbating competition between individuals and thus undermining national solidarity. The nation-state is no longer the optimal size it once was for social life and economic activity.

More culturally homogeneous and more agile economically, individual regions are therefore tempted to go it alone. The richest complain of financial transfers, that they're bankrolling less prosperous regions to their own detriment. Catalonia is a case in point, with financial transfers said to be as high as 17 billion euros per year.

Such transfers are inevitable inside a country and, generally speaking, aren't seen as a problem. In France or in the United States, they're part of the national feeling, of the "desire to live together," as French philosopher Ernest Renan once put it. But by erasing national borders, widespread free-trade has stretched this link thin. So thin, in fact, that it can snap and ultimately disconnect a region from the rest of the country.


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