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News & Insights on Europe

News and Views on Europe – 29 Mar 2018

posted by eucentresg

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US, European Countries and NATO Expel Russian Diplomats in Response to Salisbury Attack
In response to the “highly likely” Russian poisoning of double agent Sergei Skripal and his daughter, several EU members and the US have expelled almost 100 Russian diplomats and representatives; with the US expelling 60, Ukraine, 13; Poland, 4; France 4 and Denmark 2 among other countries. Interestingly, New Zealand is also expressly behind Britain in expelling undeclared Russian officials, but as stated in the Politico article, has not managed to find any Russian spies residing in New Zealand.

The largest since WWII, the mass expulsion “represents a major diplomatic coup” for May, who told Russian President Putin that the poisoning, an attempt of “intimidation”, has “spectacularly backfired” on Russia. In conjunction, NATO also expelled 7 Russian staff members from the Russia’s mission to the organisation. A further reduction in mission size, from 30 to a maximum of 20 staff, is on the cards. The moves sent a clear message that “flouting the international law will not be tolerated”. Nevertheless, NATO Secretary General Stoltenberg, maintained that even in the face of such strong actions against Moscow, NATO is still highly committed to dialogue and communication.

It should be noted that not all 28 members of the EU have taken actions against Russian diplomats living in their countries. Such EU countries as Austria, Portugal, Greece and Bulgaria have for various reasons declined to do so. According to an article in the EUobserver Portugal believes that countermeasures are most effective at the EU28 level, and not at the bilateral level. For Bulgaria, its close corporate and business links with Russia, made Sofia reluctant to punish the country. In Greece, the ruling coalition contains a pro-Russia far-right party; and for Austria, Vienna hopes to maintain its neutrality in a bid to preserve open communication lines between Russia and the EU. None of this countries have made any move to expel Russian diplomats although they have all signed up to an EU statement that singles out Russia as the perpetrator of the Salisbury poisoning.

In response to this, Russia stated that this “unfriendly move by this group of countries will not go unnoticed”. Counter retaliation measures have not been taken on the part of Russia, although this has led to an even more fractious relationship between Russia and its western counterparts.

 

EU to discuss trade with Trump with a gun to Europe’s head
On Tuesday (27 Mar), US President Donald Trump in two separate calls discussed with German Chancellor Angela Merkel and French President Emmanuel Macron on China’s “unfair” trade practices. The two calls come after the White House has taken a series of trade actions aimed at punishing China for its intellectual property practices and moved to impose tariffs on imports of steel and aluminum.

The EU was one of a handful of trading partners for which Trump agreed to delay imposing the steel and aluminum tariffs until May 1, giving them time to agree to take action to address the administration’s national security concerns and therefore avoid the duties. (Other countries given time to adjust include Argentina, Australia, Brazil, South Korea, Canada and Mexico.)

However, Macron maintained that the EU’s temporary exclusion “did not appear satisfactory to us”, describing the 40-day exemption as Trump putting a gun to Europe’s head. Commission chief Jean-Claude Juncker echoed Macron’s comments by saying that Trump’s decision to give the bloc a temporary – instead of a permanent – exemption was unacceptable. In addition, he suggested that striking an EU-US agreement before 1 May would be a “not very realistic one given the broad issues we have to discuss”. Despite the apparent resentments and protests, Commission spokesperson Daniel Rosario said on Monday (26 Mar) that Brussels is ready to discuss “any issue” the US Administration wants to raise as it seeks to obtain a permanent exemption from the tariffs.

In addition, to cultivate an amicable political environment for the bilateral trade talks to succeed, Brussels has also given indications that it is ready to work with Trump’s plan in cracking down on China’s overproduction of highly subsidised steel. At the beginning of this week, Brussels launched a safeguard investigation into how it could combat surges of steel imports. (Ostensibly, this measure is supposed to help protect the EU from inflows of Japanese, Chinese, Turkish and Russian steel that would be diverted away from the US because of Trump’s tariffs.)

It appears that the EU will not be alone in capitulating to the US’s belligerent trade policy – many countries are flinching in the face of Trump’s threats. Seoul announced Sunday (25 Mar) that it had reached an agreement “in principle” with Washington. On the one hand, the deal introduced a tariff-free quota for Korean steel shipments to the US (although this quota would be set at a level of only 70 percent of recent annual exports). In return, South Korea accepted that it would double the yearly amount of auto imports from each US company, from 25,000 to 50,000, and would accept American safety standards on those vehicles. As if that were not enough, Seoul also allowed Washington to keep its defensive 25 percent tariff on light trucks until 2041.

In Europe, while France wants to hold a robust line against Trump, Germany’s all powerful motor industry is terrified of a trade war and is in a mood to strike a bargain. Berlin’s Economy Minister Peter Altmaier said on Friday (23 Mar) that the temporary suspension of the steel and aluminum tariffs “opens a window for talks.” Bernhard Mattes, president of the German automotive lobby VDA, was even more openly in favour of a Trump deal with some kind of bilateral “disarmament”: “It’s in the sense of fair and free trade to mutually reduce trade barriers and agree on a new general framework” for transatlantic trade, he said.

 

EU-Turkey summit ended with “no solutions” despite mutual dependency
EU and Turkish leaders met in the Black Sea resort of Varna, Bulgaria for a half-day summit on Monday (26 Mar). During the reportedly “tense” meeting, EU leaders including European Council President Donald Tusk, Commission President Jean-Claude Juncker and Bulgaria’s Prime Minister Boyko Borissov weighed in against Turkish President Recep Tayyip Erdogan’s extended crackdown on civil society at home and increasingly assertive policies abroad. Erdogan, in turn, expressed exasperation over EU criticism of Turkey’s military intervention in Syria and frequent broadsides against Ankara’s human-rights record.

Despite the outlined differences and Tusk’s bleak verdict that the summit ended with “no solutions”, the EU and Turkey remain each other’s key geopolitical partner in migration, terrorism and the Middle East, among others. In particular, Europe needs Turkey to keep alive its two-year-old refugee deal, which has been crucial in helping to stem the flow of mostly Syrian refugees to the EU. The EU has already committed about €3 billion to help Turkey manage its refugee population of about 3.5 million and another €3 billion is on the way. At a time when populism is gaining ground on the issue of migration, Europe’s leaders, especially Germany’s Angela Merkel, want Brussels to do whatever it takes to preserve the arrangement.

For Turkey, what Erdoğan gets from the EU can be summed up in a single word: survival, This is because Turkey is almost completely dependent on the EU to keep its economy afloat. The EU accounts for about half of Turkish exports. With total trade of more than €130 billion between the two spheres, Turkey’s trade with the EU is more than five times greater than that with its next largest partner, China. What’s more, the EU accounts for about two-thirds of the foreign investment into Turkey. Turkey’s corporate sector, meanwhile, is heavily reliant on European investors to finance its sizable debt, a risk recently highlighted by the International Monetary Fund. Put simply, the Turkish economy would implode without Europe. Such an economic crisis is the one thing that might actually cost Erdoğan his power.

The high degree of mutual dependency notwithstanding, Turkey’s some 13-year EU membership bears on fruit so far. In 2005, Brussels and Ankara began formal talks on Turkey’s full EU membership. And in March 2016, when the EU and Turkey signed a pact mentioned earlier to stem the influx of refugees to Europe, the EU promised to accelerate accession talks and visa liberalization. None of those initiatives have materialised, however, due to the widespread crackdown on dissent and opposition following the failed military coup against Erdogan in July 2016.

 

Catalonia’s Carles Puigdemont arrested in Germany
Former president of Spain’s Catalonia region Carles Puigdemont was arrested on Sunday (25 Mar) by German police when he crossed the border by car from Denmark on his way back to Belgium. (Puigdemont has been in exile in Belgium since last year, when he fled Spain after declaring Catalonia’s unilateral independence from Spain following the referendum.) The arrest of Puigdemont was the result of German authorities enforcing a European arrest warrant issued against Puigdemont by the Spanish authorities. Spain’s Supreme Court said last Friday it would try Puigdemont and other Catalan independence leaders on charges of rebellion and misuse of public funds.

Since the arrest, Puigdemont has been held in detention in Germany pending a decision on whether to extradite him to Spain. His case will soon be passed on to the Oberlandsgericht of Schleswig-Holstein, the supreme court for the region. The judges on this court will in due course ascertain whether Spain has fulfilled the formal conditions of the arrest warrant and whether it complies with European law.

Now, the most important question facing German judicial system is whether the act that Puigdemont is accused of in Spain has an equivalent in the German law. Legal experts are reportedly split on whether the charge of rebellion has a German equivalent. The charge of embezzlement, however, does. Nevertheless, if Germany charges Puigdemont with both rebellion and embezzlement, it’s extremely likely that the court will be in favor of extradition with harsh punishment. If the court determines that only the charge of embezzlement has a German equivalent, it can put limits on the terms of extradition. In this case, Spain would only be able to charge Puigdemont with embezzlement and not with rebellion, reducing the possible length of punishment. All in all, unless Spain withdraws the arrest warrant, there’s little chance that Puigdemont will be able to avoid extradition.

The fact that Puigdemont was caught does not mean Prime Minister Mariano Rajoy can relax. For one thing, thousands of Catalan separatists hit the streets of Barcelona on Sunday, vowing the arrest of Puigdemont would not stop their push for independence as “There will be other Puigdemonts”. Protestors marched by the office of the European Commission in the Catalan capital; and when they passed the German consulate, demonstrators held up a photo of German Chancellor Angela Merkel sporting a Hitler-style moustache. For another, since Spain’s Supreme Court had effectively seized control of the case of Puigdemont last Friday after the formal issuance of that arrest order, what happens next is largely out of the government’s – and Rajoy’s – hands, at a crucial time when it is in the best interest of Madrid that the Catalan situation gets back to normal. This is because the minority government Rajoy presides over desperately needs support of Basque nationalists — who have made it clear that they won’t cooperate until things in Catalonia get back to normal – to pass his delayed 2018 budget in parliament. As a result, the government appears largely at the mercy of events, rather than exerting control over them.

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