The impact of the withdrawal from Afghanistan on Russia’s security. Egmont Security Policy Brief No. 54, March 2014

ISAF’s withdrawal from Afghanistan in 2014 will directly impact the wider region. Not only is there a risk of instability spilling over to Central Asia, but the drawdown will also accelerate the ongoing shift in the balance of power in Central Asia towards China. Should a spillover occur, the burden will mainly fall on Russia and China. Russia will, however, only continue playing the dominant role in the security of the former Soviet Central Asia (FSCA) until China takes on responsibility for the security of its direct sphere of influence or “dingwei”. Russia’s Near Abroad, however, overlaps both with the EU’s Eastern Neighbourhood in Europe and China’s dingwei in Central Asia and the Far East. It is, therefore, necessary to approach Russian reactions to these encroachments on its historical spheres of influence in a single context, taking into account the interrelationship between these three.

Geen leger, is onbetaalbaar = No Belgian armed forces is unaffordable. Egmont Security Policy Brief No. 61, February 2015

In this Security Policy Brief Jo Coelmont examines the challenges Belgium is facing at present. On the one hand there is the declared political objective to henceforth provide its defence forces with the means of achieving all of its tasks and, furthermore, to develop a new Strategic Plan, while taking decisions on replacing its current fleet of F16 fighter aircraft and determine strategic orientations on the replacement of frigates, mine hunter vessels and other major equipment programmes. On the other hand, the already taken austerity measures impose severe structural cuts on its defence budget for the upcoming five years. In this context the author is proposing some « dos and don’ts«.

Does Europe Need a Common Foreign & Security Policy? CES Germany & Europe Working Papers, No. 06.1, 15 September, 1996

CFSP's performance is widely regarded as weak. Why did Europe's stance in world politics not improve with the Treaty of Maastricht? The article analyses the present policy approach and the institutionalist and militarystrategic reform proposals. It is argued that policy and proposals suffer from drawbacks leading to an uncomprehensive formulation of a Common Foreign and Security Policy. Both do not provide CFSP with a necessary strategy but instead largely duplicate existing organizations. Furthermore, they propose concepts that are not viable because member states do not agree on a common defense policy. In addition, they fail to offer answers adequate to today's challenges, which are not primarily military in nature. Instead, a socioeconomic security policy appears to be a more realistic option. It is necessary because no other organization provides it sufficiently; it is viable because member states could agree on iti and it is adequate because the stabilization of countries in Eastern Europe is best achieved by social and economic policy-and not by military deterrence.

Divided but United: European Trade Policy & EC-U.S. Agricultural Negotiations in the Uruguay Round. CES Germany & Europe Working Papers, No. 07.3, 1996

How has the integration of trade policy and negotiating authority in Europe affected the external bargaining capabilities of the European Community (EC)? This paper analyzes the bargaining constraints and opportunities for the EC created by the obligation to negotiate as a single entity. The nature of demands in external~ the voting rules at the EC level, and the amount of autonomy exercised by EC negotiators contribute to explaining, this paper argues, whether the EC gains some external bargaining clout from its internal divisions and whether the final international agreement reflects the position of the median or the extreme countries in the Community. The Uruguay Round agricultural negotiations illustrate the consequences of the EC's institutional structure on its external bargaining capabilities. Negotiations between the EC and the U.S. were deadlocked for six years because the wide gap among the positions of the member states at the start of the Uruguay Round had prevented the EC from making sufficient concessions. The combination of a weakened unanimity rule and greater autonomy seized by Commission negotiators after the May 1992 reform of the Common Agricultural Policy made possible the conclusion of an EC-U.S. agricultural agreement. Although the majority of member states supported the Blair House agreement, the reinstating of the veto power in the EC and the tighter member states' control over the Commission eventually resulted in a renegotiation of the U.S.-EC agreement tilted in favor of France, the most recalcitrant country.

Greece & the European Agenda: EU Enlargement and European Monetary Union. CES Germany & Europe Working Papers, No. 08.2, 1998

In the decade to come, the European Union will embark on two new projects, each destined to transform it in fundamental ways: (i) Eastern enlargement, and (ii) economic and monetary union. Neither of these projects will affect all members equally or in the same way. But Greece will, for two reasons, be affected in a manner qualitatively different to all other member states. First, Greece is the only country physically affected by the Luxembourg Summit's decision to begin accession negotiations with some, but not all, Central and Eastern European applicant countries: as a result of this decision, she will continue, for at least another eight to ten years, to be the only member country not to share a common border with another member state, with all the consequent implications in economic and geostrategic terms. Second, when the European Council meets in early May to select those member states that are deemed to have met the convergence criteria, it will find that Greece is the only member state falling short of those criteria. This development may create additional difficulties for her economy during the transitional period of derogation. It will also pose new risks to Greece, insofar as she will be absent during the initial-and crucial-years of establishing a common monetary policy.

Hybrid Hysteria. Security Policy Brief No. 64, June 2015

Is “hybrid” about to replace “comprehensive” as the favourite container notion of the Brussels foreign policy community? They might not be so different, in fact. Both a hybrid and a comprehensive approach mean the integrated use of a broad range of instruments of external action towards the achievement of a foreign policy objective. It’s just that the hybrid approach put into practice by Russia today seeks to achieve rather less friendly aims than the EU’s own comprehensive approach. The hybrid approach is the comprehensive approach gone over to the dark side of the force.

After a nuclear deal: What next for Iranian oil and gas? EPC Policy Brief, 23 June 2015

On 2 April in Lausanne, after months of intense negotiations, Iran and the E3+3 (France, Germany, and the UK plus China, Russia, and the US) agreed on a framework deal for the resolution of the nuclear dispute. EU High Representative for Foreign Affairs and Security Policy, Federica Mogherini, and Iran's Foreign Minister, Mohammad Javad Zarif, issued a joint statement announcing that "solutions on key parameters of a Joint Comprehensive Plan of Action" have been found. While differences remain on several issues, including the scope of International Atomic Energy Agency (IAEA) inspections and sanctions relief, the statement has nevertheless raised hopes that a final deal may be reached this summer. If accomplished, an agreement would bring an end to more than a decade of tensions between Iran and the international community. This would result in the lifting of several sanctions, which were adopted against Iran by the United Nations, the EU, and the US. Unsurprisingly therefore, Iran's economy and in particular its energy sector are now the subject of worldwide attention.

spotlight europe #2015/02—July 2015: A Gulf CSC Could Bring Peace and Greater Security to the Middle East

Wars continue to ravage in Syria, Iraq and Yemen. Refugees are wandering around aimlessly in the Middle East with many fleeing to Europe. Saudi Arabia and Iran are adding fuel to the flames. They are vying for supremacy while remaining highly suspicious of each other. A Conference for Security and Cooperation could help to ease existing tensions. Many years ago the CSCE was a resounding success. It could thus serve as a blueprint with the nuclear agreement with Iran as a starting point of such a venture.

Flashlight Europe N°5–June 2015. OMT is Monetary Policy and Not Economic Policy

In January 2014, for the first time in its history, the German Federal Constitutional Court submitted several questions to the European Court of Justice (ECJ) in Luxembourg and asked for a preliminary ruling. The questions had arisen within the framework of the OMT case, and the issue was whether or not the OMT (“outright monetary transactions”) programme announced by Mario Draghi, the head of the European Central Bank (ECB), is in compliance with the law of the European Union. The OMT programme (which has be-come well-known because Draghi said “what-ever it takes to preserve the euro” when he unveiled it) plays an important role in the stabilization of the euro area. It means that the European System of Central Banks will be empowered to engage in unlimited buying of government bonds issued by certain Member States if and as long as these Member States are simultaneously taking part in a European rescue or reform programme (under the EFSF ot the ESM). Hitherto the OMT has not been implemented. Nonetheless a suit contesting its legality was filed with the Federal Constitutional Court. The European Court of Justice now had to decide whether or not the activities of the ECB were in compliance with European law. How-ever, the ECJ had to take into account the prior assessment of the Federal Constitutional Court. In its submission the Federal Constitutional Court made it quite clear that it was of the opinion that there has been a violation of European law. But at the same time it did not exclude the possibility that the ECJ set up legal conditions for OMT in order to avoid a violation of European law.

The Monetary Policy of the European Central Bank (2002-2015). Bruges European Economic Policy Briefings (BEEP) 35/2015.

This paper examines the policies pursued by the European Central Bank (ECB) since the inception of the euro. The ECB was originally set up to pursue price stability, with an eye also to economic growth and financial stability as subsidiary goals, once the primary goal was secured. The application of a single monetary policy to a diverse economic area has entailed a pronounced pro-cyclicality in its real economic effects on the eurozone periphery. Later, monetary policy became the main policy instrument to tackle financial instability elicited by the failure of Lehman Brothers and the sovereign debt crisis in the eurozone. In the process, the ECB emerged as the lender of last resort in the sovereign debt markets of participating countries. Persistent economic depression and deflation eventually brought the ECB into the uncharted waters of unconventional policies. That the ECB could legally perform all of these tasks bears witness to the flexibility of the TFEU and its Statute, but its tools and operating procedures were stretched to their limit. In the end, the place of the ECB amongst EU policy-making institutions has been greatly enhanced, but has entailed repeated intrusions into the broader domain of economic policies – not least because of its market intervention policies – whose consequences have yet to be ascertained.

Squaring the cycle: capital flows, financial cycles, and macro-prudential policy in the euro area. Bruegel Working Paper 2015/14, November 2015

• Before the financial and economic crisis, monetary policy unification and interest rate convergence resulted in the divergence of euroarea countries’ financial cycles. This divergence is deeply rooted in the financial integration spurred by currency union and strongly correlated with intra-euro area capital flows. Macro-prudential policy will need to deal with potentially divergent financial cycles, while catering for potential cross-border spillovers from domestic policies, which domestic authorities have little incentive to internalise. • The current framework is unfit to deal effectively with these challenges. The European Central Bank should be responsible for consistent and coherent application of macro-prudential policy, with appropriate divergences catering for national differences in financial conditions. The close link between domestic financial cycles and intra-euro area capital flows raises the question of whether macro-prudential policy in the euro area can be compatible with free flows of capital. Financial cycle divergence had its counterpart in the build-up of macroeconomic imbalances, so effective implementation of the Macroeconomic Imbalance Procedure would support and strengthen macro-prudential policy.

How to reconcile the EU border paradox? The concurrence of refugee reception and deterrence. IES Policy Brief 2015/4, November 2015

The refugee crisis that unfolded in Europe in the summer of 2015 questions the effectiveness of European border and refugee policies. The breakdown of the Dublin and Schengen rules due to chaotic situations at the borders in the Balkans marks a critical juncture for the EU. We consider this breakdown as a consequence of a long-lasting co-operation crisis among EU Member States. The most recent Council decision responds to this co-operation crisis (Council Decision 12098/15). This Policy Brief analyses EU policy and politics and argues that plans for refugee relocation and reception centres as well as the use of qualified majority voting in the Council can unfold a dynamic that helps to solve the co-operation crisis. However, underlying the problems of co-operation and effectiveness is the EU’s border paradox: while EU border policy works towards refugee deterrence, EU asylum policy aims at refugee protection. The EU’s approach in regulating borders and asylum can be understood in terms of ‘organised hypocrisy’ (Brunsson, 1993). Reconciling the paradox calls for overcoming such hypocrisy.

Don’t Go Protectionist! Trade and Investment Relations between the EU and China. Asia Policy Brief 2012/1, June 2012

The European Parliament has proposed the creation of a body to monitor foreign – in particular Chinese – investment in the EU. The initiative, driven by fears of unfair competition and a hidden political agenda behind Chinese investments, should be rejected. There are better ways to promote openness and transparency in Sino-European economic relations.

The Challenges of the EU Banking Union - will it succeed in dealing with the next financial crisis? Bruges European Economic Policy Briefings 36/2015

The EU Banking Union combines micro- and macro-prudential regulation. It aims at breaking the “doom loop” between banks and sovereign debt, promoting financial stability and mitigating the next financial shock to the real EU economy, at the lowest possible cost to the financial institutions and to the taxpayers. Success, or failure, is determined by how the banking union copes with the challenges to its two main pillars, the Single Supervisory Mechanism (SSM) and the Single Resolution Mechanism (SRM). Under the SSM, in its new supervisory role, the ECB may be subject to conflicts between the objectives of price and financial stability, and the single-supervisor role may be sub-optimal. Two regulators might have been preferable and more focus on ECB accountability will now be required. The shock-absorbing Single Resolution Fund (SRF), which is part of the SRM, may not have the capacity to deal with a crisis of the size of the one of 2008. Especially as the nature and severity of a future financial crisis cannot be forecasted. The design of the banking union is not the result of theoretical studies, but a political compromise to deal with an acute crisis. The theoretical studies that are included in this paper are not supportive of the banking union in its current form. Nevertheless, there is a good chance that the EU Banking Union may succeed, as ECB supervision of the 123 systemically important banks should contain potential demands on the SRM. In the event of a crisis that is too severe for the banking union to absorb with its current capability, the crucial assumption is that there is political will to rapidly provide new resources. The same applies, if a major financial crisis develops before the banking union is fully operational.

The Challenges of the EU Banking Union - will it succeed in dealing with the next financial crisis? Bruges European Economic Policy (BEEP) Briefings 36/2015

The EU Banking Union combines micro- and macro-prudential regulation. It aims at breaking the “doom loop” between banks and sovereign debt, promoting financial stability and mitigating the next financial shock to the real EU economy, at the lowest possible cost to the financial institutions and to the taxpayers. Success, or failure, is determined by how the banking union copes with the challenges to its two main pillars, the Single Supervisory Mechanism (SSM) and the Single Resolution Mechanism (SRM). Under the SSM, in its new supervisory role, the ECB may be subject to conflicts between the objectives of price and financial stability, and the single-supervisor role may be sub-optimal. Two regulators might have been preferable and more focus on ECB accountability will now be required. The shock-absorbing Single Resolution Fund (SRF), which is part of the SRM, may not have the capacity to deal with a crisis of the size of the one of 2008. Especially as the nature and severity of a future financial crisis cannot be forecasted. The design of the banking union is not the result of theoretical studies, but a political compromise to deal with an acute crisis. The theoretical studies that are included in this paper are not supportive of the banking union in its current form. Nevertheless, there is a good chance that the EU Banking Union may succeed, as ECB supervision of the 123 systemically important banks should contain potential demands on the SRM. In the event of a crisis that is too severe for the banking union to absorb with its current capability, the crucial assumption is that there is political will to rapidly provide new resources. The same applies, if a major financial crisis develops before the banking union is fully operational.