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.

EU enlargement to the Balkans: will the leopard change its spots? EPC Commentary, 29 September 2014

As the leadership of the European Union hands over the baton to a new management this autumn, will the winds of change blow also through the cobwebs of the EU’s enlargement agenda? Jean-Claude Juncker – the incoming President of the European Commission – has already promised to put the gearbox of further EU widening in neutral for the next five years of his mandate, and has designated the Austrian Johannes Hahn as Commissioner for the re-baptised portfolio of now European Neighbourhood Policy and Enlargement Negotiations, instructing him to focus on the Union’s political and economic ties with Southern and Eastern Europe, and in particular with the Balkans. Such an approach in the field of enlargement – once crowned the jewel of EU foreign policy – has all the appeal of a damp rag but does not necessarily depart from the festina lente strategy of the recent past. Inside the Union, political appetite and public support for expansion have been fizzling since Bulgaria and Romania joined in 2007, and were then severely curbed in the context of the on-going crisis by growing fears of importing organised crime and migrants from the Balkans. Juncker’s logic of consolidation sounds depressingly similar to what it supposedly replaces and incidentally, it also fits neatly with the unambitious and inward-looking mantra favoured at present in discussions at all levels on the future of European integration, more generally. With the 28-member block determined to catch its breath in the immediate time period, and given that even the forerunner countries in the Balkans – that is, Montenegro and Serbia – will realistically need more than five years to complete their accession talks, what priorities should guide Commissioner Hahn, soon to be Directorate-General for Neighbourhood and Enlargement Negotiations – when they get down to business on 1 November?

Why the EU must reengage with Turkey. EPC Commentary, 29 September 2014

Democratic values and basic rights in Turkey are hanging by a thread. Over the past eighteen months the rule of law, civil liberties and freedoms have been eroded which has left many Turks anxious over the direction in which their country is heading. With Turkey’s accession negotiations de facto frozen, the EU finds itself with little leverage over Ankara. Calls of concern have fallen on deaf ears as Turkey’s leadership has become increasingly belligerent, with its EU related narrative overflowing with resentment. Because Turkey’s accession negotiations are irreversibly intertwined with Turkey-EU cooperation in other areas, this has had a negative impact on the broader relationship between both sides. Recent examples include the issue of foreign fighters traveling from Europe to Syria via Turkey. Each side has accused the other of not doing enough to stem the flow. Likewise, following the decision of Russian President, Vladimir Putin, to ban the import of agricultural goods from countries that have placed sanctions on Moscow, the EU asked Turkey to demonstrate solidarity, as a “candidate country”, and not to increase exports of agricultural products to Russia. Turkey rejected this request and is reportedly working on strengthening trade ties with Moscow. Turkey remains an important partner in a number of key areas including trade, energy, foreign and security policy and migration. At a time when the EU faces crises in both its Eastern and Southern neighbourhoods, a reliable and predictable Turkey, with which it can cooperate in the Black Sea and Middle East neighbourhoods is crucial. Hence the vision and plans of the EU’s new leadership, in particular new Foreign Policy Chief, Federica Mogherini, and Commissioner for European Neighbourhood Policy and Enlargement Negotiations, Johannes Hahn, how to shape relations with Ankara is particularly significant. The Union’s current policy is counterproductive and is further eroding trust and cooperation rather than enhancing it. It needs to be turned around.

Value of health - too often ignored and forgotten by EU policy-makers? EPC Commentary, 29 September 2014

Whether on national or European level, policy-makers tend to under-value health, healthy society, and healthy citizens in policy-making. As the European Commission continue to ponder how questions related to health should be reflected in EU policy-making and what role it should take, there are three issues to keep in mind: 1) there is a need to recognise health as a value, 2) health should be considered across policies, 3) the EU has the tools to promote a healthier European society.

Energy and climate - What is the new European Commission thinking? EPC Commentary, 30 September 2014

A visible change of priorities and re-structuring of portfolios in the new European Commission have raised questions about related policy implications especially for climate and energy policies. On the one hand, it is seen that the new structure with Vice Presidents as team leaders for groups of Commissioners could encourage much needed policy coordination between policy areas, such as climate and energy policies. At the same time there are questions over what this could mean for political priorities, to what extent the Vice Presidents will be able to guide policy-making and how responsibilities will be divided. No matter what the structure of the Commission, it is in the EU’s interest to ensure that its climate and energy policies form a framework for action that helps to reduce global emissions, fight climate change locally and globally, secure energy supplies, promote wider socio-economic interests and increase competitiveness – all at the same time.

The ECB AQR and the EBA Stress Test: What will the numbers tell? CEPS Commentary, 23 October 2014

From the Introduction. With the results of its asset quality review (AQR), to be published on 26 October 2014, the European Central Bank intends to provide clarity on the shape of the 120 banks it will supervise in the eurozone, and it may request a series of follow-up actions before assuming its new set of tasks under the Single Supervisory Mechanism (SSM) Regulation in November. On the same day, the European Banking Authority (EBA) will also be publishing the results of its stress test, covering 123 banks across 22 European Economic Area (EEA) countries. For the ECB, it will be a matter of setting the standard for its future task, whereas EBA, seeks to restore the confidence it lost in the 2011 stress test and 2012 capital exercise. Both institutions will need to indicate how they will cooperate in the future in these tasks, and through enhanced disclosure, strengthen the confidence in the European banking system.

Ending the cat-and-mouse embargos game. Making use of EU funds to steer West the Moldovan agriculture exports. EPC Commentary, 30 October 2014

Agriculture in the Republic of Moldova is an important economic sector, accounting for 41% of Moldovan exports and employing 1.3 million people, a large share of the working population. The EU has surpassed Russia as Moldova’s main commercial partner (54% of its exports go to the EU). It is a paradox that the Soviet inheritance still dictates economic trends: the heavy industrialised Transnistria exports, as a percentage, more into the EU than the rest of Moldova does. The right-bank Moldova was designed by Soviet planners as an agricultural basket while Transnistria, on the left bank of the Dniester River, concentrated the heavy industry. As such, from time to time, Russia strikes Moldova where it hurts, with embargos on food and agricultural products

The strength of the Christian Democrats, the weakness of the opposition. Germany before the parliamentary elections. OSW Commentary No. 114, 12.09.2013

The political campaign before Germany’s parliamentary elections to be held on 22 September has in all its glory reflected the trends visible during the last four years of the government of Chancellor Angela Merkel – the strength of the Christian Democrats, the weakness of the opposition and the increasing marginalisation of the coalition partner, the FDP. The CDU/CSU remains the most popular political choice in Germany, largely because Angela Merkel has consistently remained the most popular German politician. Everything indicates that the CDU/CSU will win the election, even though it has been running a passive campaign and the Chancellor herself has been avoiding confrontation, presenting herself as a kind of cross-party representative of the interests of all social groups. The Christian Democrats’ main competitors, the Social Democrats, have been unable to play to their strengths and present themselves as a serious alternative to the CDU/CSU. The Christian Democrats, despite their difficult cooperation with the liberal FDP, have declared their willingness to continue doing so during the next parliamentary term. If the numbers make that impossible, and the Social Democrats and the Greens have too few votes to be able to form a government, a grand coalition of the Christian Democrats and the SPD will be formed in Germany.

“An appalling way to behave”. CEPS Commentary, 4 November 2014

Aside from David Cameron’s childish behaviour in protesting the additional payment of €2 billion due to the EU budget by December 1st, there is no point in discussing further whether the UK should contribute more to the EU budget. As underlined in this Commentary, the basic point is simple: clear rules on the contributions of member states were agreed, by common consent, whose implementation essentially involved putting numbers into a spreadsheet. This was done expressly in order to remove the political element out of a potentially contentious process. The authors accuse those countries that are now contesting the numbers as acting in bad faith. The EU cannot work if commonly agreed rules are thrown overboard whenever they do not suit a large member state.

What Cameron should have known: Q &A. CEPS Commentary, 4 November 2014

The surprise revelation that the UK would be paying a surcharge to the EU budget of €2.1 billion sent Prime Minister Cameron into a rampage. How could this misunderstanding have arisen, as the resources mechanism of the EU budget uses a rather rigid method of calculation agreed by all member states? In this Commentary, CEPS budget specialist Jorge Núñez Ferrer has adopted a Q&A format to provide a straightforward technical explanation of how the surcharge came about in an attempt to dispel the Machiavellian phantasies it has inspired in journalists and eurosceptics alike.

The case of the disappearing Fiscal Compact. CEPS Commentary, 5 November 2014

Following the Commission’s autumn forecast showing that only five euro-area countries exhibit a fiscal balance better than the 0.5% of GDP deficit allowed by the Fiscal Compact, Daniel Gros and Cinzia Alcidi attempt to explain in this new Commentary why there is precious little policy debate over these flagrant treaty violations. They find that it is not possible to put fiscal policy in a legal straightjacket and that the tight rules enshrined in the new Treaty and in national constitutions are discarded as soon as they become politically inconvenient.

Europe’s Dog in the Nighttime. CEPS Commentary, 12 November 2014

Two recent instances of flagrant infringement of agreed EU rules – the submission by Italy and France of budget plans for 2015 that clearly violated their governments’ vows of continued austerity under the Stability and Growth Pact and David Cameron’s petulant refusal to pay a back payment of billions of euros to the EU budget – threaten the EU’s fundamental workings, which are based on a clear rulebook enforced vigorously by a strong Commission. As warned by Daniel Gros in his latest CEPS Commentary, Juncker’s Commission risks losing its authority from the start if rules can be bent or broken to accommodate the larger member states’ domestic political priorities. He also calls upon leaders in member states to play their part as well. Pandering to populists may be attractive in terms of short-term electoral gains, but the long-term cost in terms of credibility, both their own and that of the EU, will be very high.

The Dano case – Or time for the UK to digest realities about the balance of competences between the EU and national levels. CEPS Commentary, 14 November 2014

The European Court of Justice's new judgment on the Dano case should be reverberating around the UK. In Michael Emerson's view, it shows how national competences can be deftly used to control for 'benefit tourism' without challenging EU law, and that the Court is not acting as the agent of 'EU competence creep', as alleged in the Eurosceptic's stereotype.

Diplomatic Spin: EU3+3 talks on Iran’s nuclear file. CEPS Commentary, 21 November 2014

The Joint Plan of Action agreed upon with Iran on 24 November 2013 gave negotiators one year to forge a comprehensive agreement that restricts the country’s ability to militarise its nuclear programme. That deadline will lapse in the next few days and diplomats involved in the talks have been trying to rein in expectations that a deal will be struck on time. Satisfying domestic constituencies in Iran and the US is what makes the politics of dealing with the nuclear file so much harder than the physics of slowing down the nuclear programme. Any future deal will have to stand on its own merits, enabling Iran and the EU3+3 to cooperate on the other geopolitical challenges they face. Both parties should therefore balance their demands with what they can realistically offer and make concessions to reach a compromise. The author of this CEPS Commentary argues that if no deal is reached on November 24th, then diplomacy should be allowed to keep on spinning for a few more months.

The Juncker Plan: From €21 to €315 billion, through smoke and mirrors. CEPS Commentary, 27 November 2014

On the face of it, the €315 billion euro in additional investment announced by Juncker to kickstart Europe’s economy should make a material difference. But, explains Daniel Gros, without actually having any margin of manoeuvre in the EU budget there cannot be any financing for new investment and there cannot be any real growth impulse. The European Commission should have made the completion of the internal market, in particular the integration of Europe’s energy markets, a precondition for any new investment plan.