Germany on Russia. Yes to links, no to rapprochement. OSW Point of View Number 39, March 2014

The German media have been correctly describing the atmosphere between the Chancellor's Office and the Kremlin as the chilliest in years. Various factors have laid bare the fact that the strategic partnership between Germany and Russia is at best currently undergoing a 'technical pause’: the underwhelming outcomes of the German-Russian intergovernmental consultations in the autumn of 2012 and of Chancellor Merkel's meeting with President Putin during the Hanover fair in the spring of 2013, as well as the way in which the EU dealt with the Cyprus debt issue and, finally, the support that Germany has extended to the anti-presidential protests in Ukraine. Meanwhile, the priorities of Germany's foreign and economic policy have changed considerably, not only as a result of the eurozone crisis, but also, even more importantly, because the attention of German business and politics has been shifting to the so-called neue Gestaltungsmächte, or new regional powers. German politicians increasingly believe that Russia should not be offered new methods or mechanisms of co-operation. Firstly, because the existing ones have not been fully utilised, and secondly, because Germany at this stage seems to have no idea of what the long-term strategy of co-operation with Putin's Russia should be.

Spotlight-Europe - March 2015: The EU neighbourhood in shambles. Some recommendations for a new European neighbourhood strategy

Executive Summary. An “arc of instability” stretching from the European Union’s (EU) eastern borders down to the Mediterranean basin has undermined its flagship European Neighbourhood Policy (ENP). This policy was designed to deliver prosperity, stability and democracy to countries surrounding the EU. It has manifestly failed and needs to be radically rethought. Starting with a tabula rasa, the EU should abandon the very concept of a heterogeneous “neighbourhood” in the face of glaring differences among the 16 countries affected, not least because some are uninterested in reform; others may even be failed states. EU member states are themselves pursuing divergent interests and goals. A fundamental review of the ENP should lead to more differentiated, targeted measures to promote “transformational change” within neighbouring states ready to accept it. The EU should offer revised incentives such as participation within the proposed “energy union” or freer trade designed to aid local economic development. It should embrace a wider range of actors, including civil society, promote entrepreneurship and help reform countries’ police and military forces. The review should reassert common EU institutions in negotiating and working with neighbours and give them a central role in preventing and resolving conflicts as well as promoting democratic reform and economic stability. This revised ENP should help underpin the EU’s efforts to forge a genuine Common Foreign and Security Policy.

Europe as International Actor: Maximizing Nation-State Sovereignty. CES Germany & Europe Working Papers, No. 06.3, 1996

The continually increasing literature on foreign- and security-policy dimensions of the European Union (EU) has provided no remedy for the widespread helplessness in gaining a purchase on Europe as an international actor. The basic hindrance to understanding this policy comes from an all-too-literal interpretation of the acronym involved: the CFSP is understood as a total or partial replacement of the nation-states' foreign and security policy. This article aims to point the way to a new understanding of the CFSP in which this policy is not based on the integration of nation­ state foreign and security policy. I suggest that the proper way to grasp the phenomenon of the CFSP is to describe it as an international regime whose goal is to administer links between economic integration and foreign- and security­ policy cooperation in the sense of maximizing the sovereignty of member states. This requires, on the one hand, the prevention of "spillovers" from the economic area that could interfere with the foreign- and security-policy indepen­ dence of member states. On the other hand, it demands applying the EU's economic potential to reinforce the foreign- and security-policy range of member states. Due to the logic of this policy, CFSP priorities and fields of ac­ tion differ profoundly from those of a national foreign and security policy. Expectations on the evolution of the CFSP must be aware of these basic characteristics of this policy.

Germany’s engagement in the resolution of the Syrian conflict. OSW COMMENTARY NUMBER 194/25.01.2016

German Tornado Recce aircraft have been engaged in reconnaissance operations over Syria since January 2016. In December 2015 the German government and parliament decided that up to 1,200 Bundeswehr soldiers would take part in the international coalition fighting Islamic State in Syria. This decision marks a new chapter in Germany’s activity in the Middle East. The increasing destabilisation of the southern neighbourhood and the consequences this has for the EU and Germany have forced the German government to increase its level of engagement in the region. Even though Germany is a third-rate player in the Middle Eastern game, it is nonetheless ever more engaged politically and wants to be viewed as a neutral mediator between the competing actors in the region. It has also allocated more funds on regional development co-operation and humanitarian aid. Germany, whose attention has been directed towards Europe’s eastern neighbourhood, is currently turning its attention to the South. The Middle East (and Africa) is taking on increasing significance in German foreign and security policy. This may affect NATO’s eastern flank and the EU’s eastern neighbourhood since part of Germany’s instruments and funds may be redirected to the South.

A Global Strategy for a soul-searching European Union. EPC Discussion Paper, 13 July 2016

On 28 June 2016, just a few days after the historic Brexit vote, High Representative of the Union for Foreign Affairs and Security Policy Federica Mogherini presented the paper on the new European Union Global Strategy (EUGS) at the European Council, outlining the strategic coordinates for the EU’s foreign and security policy. In this Discussion Paper, Giovanni Grevi takes a closer look at the EUGS and assesses its main rationale, features, added value and prospects against the backdrop of an ever more complex world. Not only is the EU dealing with increasingly contested and polarised politics at home, but the global theatre itself has become hugely disorienting, more integrated and yet more fragmented at the same time. The paper recalibrates the overall foreign policy posture of the EU and sketches out a more modest and concrete approach compared to earlier aspirations, and a more joined-up one compared to current practice. By doing so, the strategy seeks to square the circle between the need for Europe to be cohesive and purposeful in a harder strategic environment and the fact that domestic politics within the Union constrain its external action and drain its attractiveness. The EUGS calls on the EU and member states to fully take on their responsibility to underpin unity, prosperity and security at home by taking more effective and joined-up action abroad. The question is, of course, whether this call will be heeded.

Armanents duplication in Europe: a quantitative assessment. CEPS Policy Brief No. 297, 16 July 2013 [is another Brief with no. 297]

Effectively addressing the issue of duplication in Europe’s defence systems will require a considerable amount of political will and, more importantly, a far-sighted vision of the way to go. Difficult choices will have to be made, and EU member states will have to invest in a complex exercise of coordination of defence and industrial policies and planning. However, the efficient management of EU defence budgets and the maintenance of a viable industrial base demand such efforts. After all, what is at stake is the EU’s ability to guarantee its own security. The author makes a series of proposals to address this issue ahead of the European Council of December 2013, which will be devoted to matters of security and defence.

Historic turning point or just another chapter? The results of a foreign-policy summit. EPC Post-Summit Analysis, 24 March 2014

The March 2014 European Council could enter the history books as a turning point, not only in the EU’s relations with Russia but also in its role as a foreign policy actor. Events in Ukraine inevitably dominated the Summit, with EU leaders adopting a balanced approach aimed at achieving three key objectives – de-escalation, containment/deterrence and cooperation – based on political and economic support for Ukraine, increased but limited pressure on Russia, and moves to strengthen ties with other EU neighbours. The Summit also discussed a range of economic and environmental policy issues, with the situation in Ukraine casting a long shadow over the discussion on energy policy, but failed to reach agreement on the EU’s climate goals to 2030, or to put more flesh on the bones of calls for a European “industrial renaissance”. However, two other developments were particularly significant: the creation of the second pillar of the future banking union, establishing a single regime for winding down failing banks; and changes to the savings tax directive, bringing years of negotiation to an end.

Foreign policy at the service of modernisation: old wine in a new wineskin. OSW Commentary No. 39, 2010-08-31

Russia’s contacts with the external world over the past year have been characterised by a gradual improvement in its relations with the West, as well as the use of non-confrontational rhetoric, the most far-reaching example of which was the address President Dmitri Medvedev gave to Russian ambassadors this July. In an attempt to harmonise foreign policy with the widely propagated programme for the modernisation of Russia1 President Medvedev presented a vision of the Russian Federation as a responsible global power which is open to co-operation. According to this vision, Russian foreign policy would help to attract foreign investments and technologies. The West was presented as a partner, not a rival. Both this rhetoric and the atmosphere of co-operation in relations with the USA and the EU contrast with the assertive and aggressive Russian policy which was symbolised by and culminated in the Russian-Georgian conflict of 2008. The changes observed in Russian foreign policy are quite limited, and are not constructing a new external strategy. Those changes are rather an attempt to find more efficient ways to implement old strategic goals. The new image of a responsible global power is inconsistent, and Russian policy is still assertive and geopolitically motivated. Although a new rhetoric is really in place, the Russian political elite’s perception of their country’s place and role in the contemporary international order remains unchanged. Moscow’s readiness to become engaged in genuine co-operation with the West has not increased significantly; it is still to a great extent declarative in nature.

More Union in European Defence. CEPS Task Force Report, 26 February 2015

Years of uncoordinated cuts in defence spending have eroded the EU’s role as a security actor in what is now a multipolar world. This CEPS Task Force report aims to provide member states and the EU institutions with the narrative to strengthen defence cooperation in the EU, in the face of numerous emergencies in the EU’s strategic neighbourhood and ever-present security threats. The report is a record of the deliberations over several months between high-level experts in the field of European security and defence, who conclude that the Treaty of Lisbon demands and permits a great deal more in terms of our common security and defence activities. And that member states could achieve much more value for money than the €190 billion that they spend to keep up 28 national armies, comprising roughly 1.5 million service personnel. This report suggests policy actions to further the EU’s strategic, institutional, capabilities, and resources cooperation in the field of defence. Ultimately, in the view of the Task Force experts, further integration should amount to a European Defence Union.

The Baltic states’ Territorial Defence Forces in the face of hybrid threats. OSW Commentary Number 165, 19.03.2015

From the Introduction. Russia’s annexation of Crimea and its aggression in eastern Ukraine have triggered a debate about the main directions of defence policy in the Nordic and Baltic region. In the Baltic states, but also in the Nordic countries and Poland, much attention is being paid to questions of Territorial Defence Forces (TDF). TDF are viewed as one of the elements in the national defence systems’ response during the early stages of a hybrid conflict. The Baltic states have decided to adapt their Territorial Defence Forces to new threats by making a number of changes to their functioning, depending on the local conditions in each case. Given the growing uncertainty in the region, they have opted not to undertake any in-depth reforms of TDF at this stage, as that could entail a temporary disorganisation in the armed forces. In the coming years Estonia, Latvia and Lithuania will invest in increasing the size and combat readiness of their Territorial Defence Forces, providing them with better training and equipment, and creating a system of incentives to encourage more people to serve in volunteer formations.

The European Union as a System of Differentiated Integration: Interdependence, Politicization and Differentiation. IHS Political Science Series No. 137, 10 July 2014

This paper conceptualizes the European Union (EU) as a system of differentiated integration characterized by both variation in levels of centralization (vertical differentiation) and variation in territorial extension (horizontal differentiation) across policy areas. Differentiation has been a concomitant of deepening and widening and has increased and consolidated as the EU’s powers, policy scope, and membership have grown. Turning to explanation, the paper attributes the pattern of differentiated integration in the EU to the interaction of interdependence and politicization. Differentiation among the member states (internal differentiation) results from supranational integration under conditions of high interdependence and politicization. By contrast, external differentiation (the selective policy integration of non-member states) occurs in highly interdependent but weakly politicized policy areas. These constellations are illustrated in case studies of differentiation in the internal market, monetary union, and defence.

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.

Pro-American non-alignment. Sweden and Finland develop closer military co-operation with the United States. OSW COMMENTARY NUMBER 205/31.03.2016

Russia’s increasingly aggressive policy and its enhanced military activity in the Nordic-Baltic region has led to revaluations in Sweden’s and Finland’s security and defence policies and a rethinking of the formats of their military co-operation. While remaining outside NATO, the two states have been developing closer bilateral defence co-operation and working more closely with the United States, while at the same time developing co-operation with NATO. Sweden and Finland perceive the United States as the guarantor of regional and European security. From their point of view, the United States is currently the country that has both the necessary military capabilities and the political will to react in the event of a conflict between Russia and NATO in the Nordic-Baltic region, in which both countries would inevitably become involved despite their non-aligned status. For Sweden and Finland, intensified co-operation with the United States offers an alternative to NATO membership, which is currently out of the question for domestic political reasons. Meanwhile, the US has also become increasingly aware of the strategic importance of the two states, which, for the purposes of contingency planning, are in fact an extension of NATO’s north-eastern flank.

Monetary policy and banking supervision: coordination instead of separation. CEPS Policy Brief No. 286, 12 December 2012

Introduction. Following the June 2012 European Council decision to place the ‘Single Supervisory Mechanism’ (SSM) within the European Central Bank, the general presumption in the policy discussions has been that there should be ‘Chinese walls’ between the supervisory and monetary policy arms of the ECB. The current legislative proposal, in fact, is explicit on this account. On the contrary, however, this paper finds that there is no need to impose a strict separation between these two functions. The authors argue, in fact, that a strict separation of supervision and monetary policy is not even desirable during a financial crisis when the systemic stability of the financial system represents the biggest threat to a monetary policy that aims at price stability. In their view, the key problem hampering the ECB today is that it lacks detailed information on the state of health of the banking system, which is often highly confidential. Chinese walls would not solve this problem. Moreover, in light of the fact that the new, proposed Supervisory Board will be composed to a large extent of representatives of the same institutions that also dominate the Governing Council, the paper finds that it does not make sense to have Chinese walls between two boards with largely overlapping memberships. In addition, it recommends that some members of the Supervisory Boards should be “independents” in order to reduce the tendency of supervisors to unduly delay the recognition of losses.

Brazilian climate policy since 2005: continuity, change and prospective. CEPS Working Document No. 373, February 2013

In the five-year period 2005-09, Brazil has dramatically reduced carbon emissions by around 25% and at the same time has kept a stable economic growth rate of 3.5% annually. This combination of economic growth and emissions reduction is unique in the world. The driver was a dramatic reduction in deforestation in the Amazonian forest and the Cerrado Savannah. This shift empowered the sustainability social forces in Brazil to the point that the national Congress passed (December 2009) a very progressive law internalising carbon constraints and promoting the transition to a low-carbon economy. The transformation in Brazil’s carbon emissions profile and climate policy has increased the potentialities of convergence between the European Union and Brazil. The first part of this paper examines the assumption on which this paper is based, mainly that the trajectory of carbon emissions and climate/energy policies of the G20 powers is much more important than the United Nations multilateral negotiations for assessing the possibility of global transition to a low-carbon economy. The second part analyses Brazil’s position in the global carbon cycle and public policies since 2005, including the progressive shift in 2009 and the contradictory dynamic in 2010-12. The final part analyses the potential for a transition to a low-carbon economy in Brazil and the impact in global climate governance.