From supervision to resolution: next steps on the road to European Banking Union. Bruegel Policy Contribution 2013/04, February 2012

The European Council has outlined the creation of a Single Resolution Mechanism (SRM), complementing the Single Supervisory Mechanism. The thinking on the SRM’s legal basis, design and mission is still preliminary and depends on other major initiatives, including the European Stability Mechanism’s involvement in bank recapitalisations and the Bank Recovery and Resolution (BRR) Directive. The SRM should also not be seen as the final step creating Europe’s future banking union. Both the BRR Directive and the SRM should be designed to enable the substantial financial participation of existing creditors in future bank restructurings. To be effective, the SRM should empower a central body. However, in the absence of Treaty change and of further fiscal integration, SRM decisions will need to be implemented through national resolution regimes. The central body of the SRM should be either the European Commission, or a new authority. This legislative effort should not be taken as an excuse to delay decisive action on the management and resolution of the current European banking fragility, which imposes a major drag on Europe’s growth and employment.

Down the road to Dubrovnik – Doing without an Ottoman Empire bypass bridge. CEPS Commentary, 29 July 2013

As Europeans speed down the road to Dubrovnik, Croatia's treasured jewel of the Adriatic coast, Michael Emerson discusses in a seasonal commentary one topical issue: What to do now over the 9 km of Bosnian coastline that separates north and south Croatia? Several options are under consideration, one of which would mean a very expensive bridge and dubious use of EU structural funds.

Road to Proscription: The EU and Hezbollah since the Arab Spring. EU Diplomacy Paper 07/2013

The European Union (EU) has traditionally taken a rather nuanced view of the activities of Hezbollah. Despite historic links to violent activity, Europe always remained reluctant to place the Lebanese militant group on its list of terrorist organisations. Internal divergences among member states, as well as the strategic-realist goals of the EU in both Lebanon and the Middle East more generally meant that such a listing never materialised. This remained the case even in the initial turmoil following the Arab uprisings, when Hezbollah’s relatively moderating objectives were viewed as a force for stability. However, the EU shifted policy in July 2013 by listing the military wing of Hezbollah as a terrorist entity. This paper will investigate the reasons behind this decision, as well as the likely implications and effectiveness of the new policy. Two principal catalysts were behind the decision. The first was a Hezbollah-linked bombing in Bulgaria which provided the focal point around which a consensus of the EU member states could emerge in the Council. Secondly, the escalation both of the Syrian conflict and Hezbollah’s role in it provided a more political and strategic impetus for the decision. This paper maintains that although a change in policy was somewhat necessary, it is questionable whether the artificial separation of Hezbollah’s political and military wings and the symbolic proscription of the latter is the most propitious choice to achieve European objectives.

The Transatlantic Trade and Investment Partnership: A long hard road to multilateralism? EPC Commentary, 26 September 2014

The seventh round of the Transatlantic Trade and Investment Partnership (TTIP) negotiations between the European Union and the United States will take place in Washington on 29 September. If concluded successfully, the TTIP would become the world’s largest free trade pact. The EU and the US account for nearly half of the world’s GDP and 30% of world trade with exchanges of goods and services worth around €723 billion a year and €1.8 billion a day. The Partnership, unprecedented in its scope and ambition, has generated great expectations which will be hard to meet in reality. It could however have a beneficial effect on trade multilateralism, provided that it is the result of an open negotiating process.

Taking its place in Europe – Iceland’s long road to its EU application. Jean Monnet Occasional Paper 03/2013

Iceland applied for EU membership in 2009. Before that it had sought to alleviate pressures on her to fully integrate with Europe firstly by pursuing limited integration through membership of the European Free Trade Association (EFTA) and later by joining the European Economic Area (EEA). This paper traces the steps taken by this peripheral European country from its struggle of independence from Denmark, through World War II, American occupation, the founding of a republic, NATO membership and the Cod Wars with Britain. The paper analyses the various phases of the debate on the ties to the European institutions leading to EEA and Schengen membership, the “miraculous economic success“ which ended in the epic crash of 2008 which precipitated a much contested EU application.

The Rocky Road to an EU-Armenia Agreement: From U-turn to detour. CEPS Commentary, 3 February 2015

The EU was taken by surprise when the President of Armenia, Serzh Sargsyan, stood by his Russian counterpart and announced Armenia’s plans to join the Russian-led Customs Union in September 2013. After all, before this announcement Armenia and the EU had successfully concluded negotiations on their Association Agreement. Armenia is still suffering the consequences of the Kremlin’s coercion to reject this Association Agreement. Indeed, as Armenians around the world commemorate the centenary of the Armenian Genocide by Ottoman Turkey, the Republic of Armenia is facing mounting challenges. The country remains subject to an economic blockade by Turkey and is in conflict with Azerbaijan. Ever since President’s Sargsyan’s astonishing volte-face, the EU and Armenia are still in the process of trying to rework the failed agreement. The author of this commentary argues that because the future of any new agreement is uncertain, negotiations should be accompanied by a pragmatic EU-Armenia roadmap. This roadmap, alongside the start of the visa liberalisation process and Armenia’s signing up to the European Common Aviation Agreement and Horizon 2020, could become a deliverable at the Riga Summit on 26-27 April 2015.

Europe on the Road to the Third Stage of EMU: Recent Evidence. CES Germany & Europe Working Papers, No. 07.2, 1996

The paper deals with Europe's effort to proceed to the thud stage of EMU and establish a common currency. It is argued that the success of the common currency experiment will greatly depend on the fulfillment of the Optimum Currency Area (OCA) criteria, on the adoption of the proper adjustment policies as well as on the political desirability of the project. The paper is organized as follows: Section 1 deals briefly with the index of criteria that define an OCA. Section 2 examines the extent to which Europe experiences common demand disturbances, while sections 3 and 4 focus on evidence about the mobility of factors of production across Europe, namely labor and capital. Section 5 examines the possibility of an increase in trade volume across the EU under fixed exchange rates or a common currency regime. Section 6 sheds light on the possibility of the EURO (the ex-ECU} to become a vehicle currency in the international financial system, and Section 7 is concerned with the benefits and costs of the establishment of a European Central Bank (ECB), paying special attention to seigniorage revenues. Section 8 deals with the necessity of establishing an EU federal mechanism facilitating adjustment. Section 9 sketches out a proper role for a hegemonic power in a common currency regime. Finally, section 10 examines EMU prospects during the transitional period. The paper closes with some concluding remarks, where the role of politics and coordination of economic policies are particularly emphasized as of cardinal importance on the road to the third stage of EMU.

On the Road to Democracy? Political Liberalization in Myanmar. Asia Policy Brief 2014/01, January 2014

Myanmar’s liberalizing reforms initiated by President Thein Sein after taking office in March 2011 are raising high hopes of peace and democracy in the country. Progress, after nearly three years, has however been uneven: there have been positive developments in the area of press freedom, with regard to political prisoners and in dealing with the political opposition. At the same time the dialogue with ethnic groups has stagnated and ethnic and religious violence has escalated. This Asia Policy Brief critically assesses the reform policy and weighs up the chances of democratization of the long-time military regime.