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News & Insights on Europe

News and Views on Europe – 9 Feb 2018

posted by eucentresg


UK had no firm Brexit plan, yet rules out customs union
As Phase II of Brexit negotiations will be resumed next week, the EU’s chief negotiator Michel Barnier visited London on Monday (5 Feb). Just before Barnier’s arrival, a senior British official said Sunday (4 Feb) evening that any form of a customs union – meaning bilateral free trade plus common external tariff vis-à-vis third parties – is out of the question. Confirming this after lunch with British Brexit Secretary David Davis, and a 20-minute meeting with Prime Minister Theresa May, Barnier said barriers to trade in goods and services post-Brexit are “unavoidable”. Nevertheless, Bariner pressed the UK to “make [a final] choice” between soft Brexit and hard Brexit.

One reason why Barnier still pushed Ms May to make a decision when the choice was seemingly already made is that Brussels, based on the experiences of Phase I negotiations in which Ms May’s redlines were considerably compromised in the EU’s favour, believes it is only a matter of time before she backs down again to stay in the customs union or a similar customs arrangement. But, conversely, for (hard-)Brexiteers, Barnier is just not listening. They argue that the priority for the UK is to take back trade policymaking authority in order to strike independent free-trade deals with countries across the world after Brexit. This mutual “credibility gap” over the other’s negotiation position could have major implications over the final outcome of the talks ahead.

Brussels, in preparation for the upcoming negotiations, is set to toughen Brexit transition demand. It is already well known that the EU asks the UK to abide by all EU laws and obligations, even as it loses all voting rights and representation in Brussels. To this main requirement, the updated terms add that “The United Kingdom shall abstain, during the transition period, from any action or initiative which is likely to be prejudicial to the Union’s interests in the framework of any international organization, agency, conference or forum of which the United Kingdom is a party in its own right.” Interpreted strictly, it would bar the UK from taking any position at the UN, the WTO or in the G7 or G20 that run counter to the EU’s wishes. If the UK “misbehaves”, the bloc should be able to cut Britain’s access to the EU’s single market.

In the face of an increasingly hard-line EU and despite sustained pressure to articulate what kind of relationship Britain wants with the EU, the British government will refrain from agreeing on a united Brexit plan this week. This does not bode well for Britain. Barnier will receive his formal negotiating instructions from EU leaders, possibly on March 22-23. The inavailability of the UK’s views on future relations this week means that Brussels will set out its own positions without the chance to consider Britain’s proposal.

An interesting development this week with potentially profound implications on European politics in relation to Brexit is that members of the European Parliament (MEPs) had a vote on Wednesday (7 Feb) deciding how to allocate the 73 seats that would be vacated with the departure of the UK in 2019. EU politicians wanted to shrink the size of the Parliament and proposed to hold 46 of those seats in reserve for possible pan-European candidate lists and for countries that might join the EU in the future. French President Emmanuel Macron is a big fan of this proposal and has long advocated transnational lists of candidates from across the continent. While there had been heated debate on the prospect of potential cross-border EU voting behaviors highlighting the good and the bad, the Parliament firmly rejected the proposal, saying “The idea of transnational lists, where MEPs are elected without constituencies and without responsibility, rejects true Europe.”


German study on China’s growing political influence in Europe
Mercator Stiftung and Global Public Policy Institute in Berlin jointly published a report entitled “Authoritarian advance: Responding to China’s growing political influence in Europe” this week. The report notes that the Chinese Communist Party (CCP) has recently expanded its efforts to influence Europe’s political and economic elite, media and civil society, in order to promote its authoritarian ideals. This development, according to the report, poses a significant challenge to liberal democracy as well as European values and interests.

The report then argues that European states need to act swiftly and decisively to inhibit the momentum of the CCP’s influence operations. Several steps are recommended, including: a stronger focus on leveraging the collective weight of EU member states, investing more resources into independent China expertise and providing alternatives to Chinese investments in Europe. The authors also call upon Europe to develop a flexible set of investment screening tools and to strengthen national and European security regimes, including cyber-security and counter-intelligence.

The report expectedly drew criticism from Chinese media. The state-affiliated tabloid Global Times, for example, carries an op-ed by Yu Ning, arguing that “China has no desire to change the EU’s political system nor does it believe it is capable of doing so.” Slamming the think tanks as “misguided academics” that promote EU-China confrontation, Yu urged European scholars, when studying China’s influence on the global stage, to treat China “fairly and without prejudice”. Along similar lines, describing European scholars as “adding fuel to the fire”, another Global Times article suggests that this Mercator report, and the similar study conducted by European Council on Foreign Relations released last December, only attests to the fact that Europe (and America) lacks essential self-confidence to deal with a rising China. While urging Europe to “face reality”, the newspaper also, by quoting a Chinese scholar, reaffirms that China will continue to support the unity of the EU and European integration at large.


EU overcomes enlargement fatigue to welcome the Western Balkan countries
On Tuesday (6 Feb) Federica Mogherini, the EU’s foreign policy chief, and Johannes Hahn, the EU’s Commissioner for enlargement, presented the Commission’s long-awaited Balkans strategy titled “A credible enlargement perspective for and enhanced EU engagement with the Western Balkans” in Strasbourg. Mogherini called the strategy a turning point in the history of the bloc and said progress toward membership for six Western Balkan countries — Albania, Bosnia and Herzegovina, Kosovo, Macedonia (FYROM), Montenegro and Serbia — could in the coming months become “irreversible and tangible for all.”

The strategy aims to outline a roadmap after Commission President Jean-Claude Juncker suggested a renewed openness toward EU enlargement in his State of the Union speech last September. The EU had previously suffered from “enlargement fatigue,” after waves of accessions of Central and Eastern European countries. The 2015 refugee crisis, put the Western Balkans in the spotlight and highlighted the region’s importance to EU stability, since the vast majority of migrants and asylum-seekers made their way to Western Europe via the Western Balkan route. Also concerns over Russian, Chinese and Turkish increased influence in the region, contributed to the EU’s fresh interest in the region. The strategy aims to inject new momentum into EU integration. Hahn stressed that the EU had the chance to make the Western Balkans more stable, otherwise there would be repercussions for the entire EU. “Either we export stability or we will import instability,” he said.

Mogherini’s and Hahn’s upbeat tone was in contrast to the blunt language in the strategy itself, which reads: “Today, the countries show clear elements of state capture, including links with organised crime and corruption at all levels of government and administration, as well as a strong entanglement of public and private interests. (…) None of the Western Balkans can currently be considered a functioning market economy.” The Commission stated that Serbia and Montenegro could potentially join the EU by 2025, while at the same time offering more support to the four other potential EU member states, given time for these countries to solve their bilateral disputes.

Some experts have also voiced concern over some trends in the Balkans, including erosion of democracy, rule of law and media freedom, slack economic performance, fast-rising nationalist sentiments, and external influences. Therefore, the strategy outlines six flagship initiatives, targeting specific areas of common interest – rule of law; security and migration; socio-economic development; transport and energy connectivity; digital agenda; reconciliation and good neighbourly relations.

The EU is already the most important donor and investor in the region as well as political partner of the Western Balkans. The EU is also the Western Balkans’ largest trading partner with an annual total trade volume of €43 billion (2016). Today, the European Commission set out Six flagship initiatives that will further strengthen our cooperation in a number of areas and support the transformation process in the Western Balkans. These flagship initiatives target specific areas of common interest: rule of law, security and migration, socio-economic development, transport and energy connectivity, digital agenda, reconciliation and good neighbourly relations. Concrete actions in these areas are foreseen between 2018 and 2020.

As part of the new push, Juncker is scheduled to visit the Western Balkans for a week at the end of February, with a clear message: “Keep reforming and we will keep supporting your European future.” The diplomatic push is expected to come in May when EU leaders will meet their six Balkan counterparts at a special enlargement summit in Sofia. Bulgaria, currently at the helm of EU’s rotating presidency, has made the Western Balkans a priority.


Turkey wants in – Erdogan wants Turkey to be full EU member
While the EU opens its doors to the Western Balkans, and the spotlight is now on steps to be taken by Western Balkan states to become EU members, EU troubled relations with one of its longstanding candidate state Turkey is also back in the limelight. In an interview to Italy’s La Stampa newspaper before his visit to Rome, Turkish President Recep Tayyip Erdogan rejected proposal of a partnership with the EU and insisted that full membership of Turkey in the EU is the only option.

Turkey is a candidate state for EU membership and accession talks started in 2005. However talks have been suspended due to the political developments in Turkey. The failed coup in 2016 to which Ankara reacted by arresting judges, journalists and opposition figures, contributed to the difficult relationship between the EU and Turkey. Turkey also angered some EU countries ahead of its constitutional referendum in March 2017, by sending ministers to EU member states with significant Turkish diaspora, to speak in favour of President Erdogan’s plans. The talks on Turkish accession to the EU stopped in 2017 following the passage of the constitutional referendum.

EU relations with Turkey look to be further strained by the latest Turkish offensive against Kurdish militia (supported by the US and its Western allies) in Syria. Members of the European Parliament on Thursday (8 Feb) expressed serious concern about the humanitarian consequences of Turkish military assault of Afrin. A resolution was passed calling on the EU’s foreign policy chief, Federica Mogherini and EU member states to raise the situation of human rights and make sure that funds destined for Turkey under the EU’s Instrument for Pre-Accession Assistance should be conditional on improving its record on human rights, democracy and rule of law.

Besides the broader accession talks, Turkey has also been pressing for visa-free travel to the EU for its citizens. The Turkish ambassador to the EU, Faruk Kaymakci, presented a plan to the European Commission on Wed (7 Feb) to meet the EU required benchmarks for visa free travel for Turkish citizens to the EU. The head of the human rights watchdog Council of Europe, Thorbjorn Jagland would be visiting Turkey next week to press for the release of journalists and assess the state of reforms needed in order to lift visa restrictions.

This issue of visa-free travel is likely to be an issue to be raised at the EU-Turkey Summit to be held on 26 March in Varna, Bulgaria. Turkish President Recep Tayyip Erdoğan will meet European Council chief Donald Tusk, European Commission President Jean-Claude Juncker and Bulgarian Prime Minister Boyko Borissov. Bulgaria currently holds the rotating Presidency of the Council of the EU.


Relief across Europe over German coalition deal
Five months after the German elections and after several twists and turn, Germany’s Christian Democratic Union (CDU/CSU) and Social Democratic Party (SPD) finally concluded a coalition agreement on Wednesday (7 Feb). Leaders in Brussels hailed the deal as good news for the EU. National newspapers reported that SPD leader Martin Schulz is set to become foreign minister, while Hamburg mayor Olaf Scholz (SPD) will take the finance minister post, which has been under Wolfgang Schäubele’s (CDU) strict spending controls for eight years. Increased spending to boost investments and reduce taxes would be key policy changes. Angela Merkel (CDU) of course will remain Chancellor and therefore the leading force in German European policy. However, the SPD will also have a big say in the reform of the eurozone and the EU. The CDU/CSU also secured some key ministries, including the ministry for economy, led by Peter Altmair, a close ally of Merkel and the ministry of interior, led by Horst Seehofer (CSU), a hardliner and harsh critic of Merkel’s migration policy. It is expected that Seehofer will take a tough line on migration, which also might have implications for the rest of the bloc.

Schulz, a pro-European at heart and former president of the European Parliament, said that the German government would not only “return to an active and leading role in the European Union”, but also put more into the EU budget. He also stressed his close relationship with French President Emmanuel Macron, adding that he wanted to work with Paris for: “A better and fairer Europe.” However, there is one last hurdle: the SPD’s membership vote on the coalition deal, expected by early March, which hopefully will put an end to the five-months of political limbo in Berlin.

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