Thursday, 29 September 2011

European Parliament: Caspary and De Gucht debated new trade policy for Europe (EU2020)

You can now read the 27 September 2011 debate about the new trade policy for Europe under the Europe 2020 strategy (item 4), posted by the European Parliament in the original languages of the speakers.

We look at some of the main points made by two of the protagonists, the EP rapporteur Daniel Caspary and the trade commissioner Karel De Gucht.

Daniel Caspary, INTA rapporteur

The report from the EP Committee on International Trade INTA was highly critical of the communication COM(2010) 612. The rapporteur, Daniel Caspary, criticised the Commission for the lack of a rigorous analysis of the profound changes taking place in world trade and for failing to present a medium and long term strategy based on these developments.

The starting point for the EP own-initiative report was the trade policy communication from the Commission:

Trade, Growth and World Affairs: Trade Policy as a core component of the EU's 2020 strategy; Brussels, 9.11.2010 COM(2010) 612 final

Karel De Gucht, trade commissioner

The trade commissioner Karel De Gucht found the criticism unwarranted. In addition to the communication, he referred to the two Commission staff documents, which accompanied the communication:

COMMISSION STAFF WORKING DOCUMENT: Report on progress achieved on the Global Europe strategy, 2006-2010; Brussels, 9.11.2010 SEC(2010) 1268 final (23 pages)

An assessment of the Global Europe Strategy adopted by the Commission in 2006, according to De Gucht.

COMMISSION STAFF WORKING DOCUMENT: Trade as a driver of prosperity; Brussels, 9.11.2010 SEC(2010) 1269 final (71 pages)

Rigorous economic analysis as well as available long-term forecasts, according to De Gucht.

Commissioner De Gucht reminded listeners that 36 million jobs in the EU depend on our external trade. He argued that the Commission's new trade policy can generate EUR 150 billion every year, and more jobs at the same time.

De Gucht offered a brief overview of ongoing negotiations for free trade agreements (FTAs), multilateralism (WTO Doha, including the Least Developed Countries), access to public procurement markets, trade and investment barriers, access to raw materials and energy supplies and trade defence measures (anti-dumping and anti-subsidy).

Ralf Grahn

Wednesday, 28 September 2011

EP wants new trade strategy for Europe under EU2020

The press service of the European Parliament tells us the Result of votes Tuesday 27 September 2011.

We see that the INTA report, prepared by Daniel Caspary (EPP, DE), on a New trade policy for Europe under the Europe 2020 strategy (A7-0255/2011; procedure INI/2010/2152) was adopted by 526 votes in favour to 108 against with 9 abstentions.

EP accuses Commission of lack of trade strategy

The report from the EP Committee on International Trade INTA was highly critical of the communication COM(2010) 612:

Trade, Growth and World Affairs: Trade Policy as a core component of the EU's 2020 strategy; Brussels, 9.11.2010 COM(2010) 612 final

In the proposed resolution INTA did not mince its words, when it accused the Commission of failing to come up with an EU strategy for international trade and when it asked for a new strategy by next summer:

Parliament expected to receive a real future trade strategy, which took account of mid- and long-term developments and did not build on the false assumption of a continuing status quo on the world trade stage

1.  Welcomes in general the triple objectives of Europe 2020 of smart, inclusive and sustainable growth and the Commission’s Communication ‘Trade, Growth and World Affairs’, and urges on the Commission to present a forward-looking and innovative future strategy on trade and investment taking into account the new challenges of the EU;

2.  Regrets that many targeted goals of the Global Europe Strategy have not been reached as yet and would have expected a more critical analysis of the Strategy with a view to a better understanding of certain failures to achieve;

3.  Insists that the Union needs a coherent long-term trade strategy in order to take account of the challenges ahead and in particular of the major emerging countries; insists that such a strategy should be based on a thorough analysis of the current trends in world trade, the Union’s internal and external development as well as the diversity of European enterprises, their know-how and their technological advances; regrets that the Communication fails to deliver a profound forecast of how the ‘world of trade’ could look in a policy-planning perspective of 15 to 20 years; considers that this review should establish the Commission’s ambitions for its bilateral trading relationships over this period including a distinct geographical strategy, for example through the creation of new agreements or targets for eliminating tariffs and non-tariff barriers with its major trading partners;

4.  Asks the Commission to deliver such a forecast as a basis and to present a revised mid-and long-term trade strategy by summer 2012, as the Communication on Trade Growth and World affairs fails to do so;

Ralf Grahn

Tuesday, 27 September 2011

EU trade policy review

After the blog entry EU trade ministers ponder comatose WTO Doha Development Round, followed by two posts in Swedish, Vill EU bryta dödläget i WTO:s Doharunda? and EU:s nya handelspolitik i Europa 2020-strategin, we leave the European Parliament debates for a while in order to explore the the basic documents for the common commercial policy of the European Union.

EU trade policy review

In November 2010 the Commission published the communication COM(2010) 612, available in 22 official EU languages. The English version:

Trade, Growth and World Affairs: Trade Policy as a core component of the EU's 2020 strategy; Brussels, 9.11.2010 COM(2010) 612 final (22 pages)

One of the two accompanying documents was an assessment of the EU's policy of international economic relations:

COMMISSION STAFF WORKING DOCUMENT: Report on progress achieved on the Global Europe strategy, 2006-2010; Brussels, 9.11.2010 SEC(2010) 1268 final (23 pages)

Global Europe communication

In other words, the assessment concerned the 2006 communication Global Europe and subsequent actions:

GLOBAL EUROPE: COMPETING IN THE WORLD: A Contribution to the EU's Growth and Jobs Strategy; Brussels, 4.10.2006 COM(2006) 567 final (18 pages)

2010 lessons

The progress report SEC(2010) 1268 reviewed main trade policy actions until well into 2010, beyond the adoption of the Europe 2020 strategy (EU2020). Thus, the report can be read as fairly recent history of the EU's economic relations.

The Commission evaluated that (page 21):

Notwithstanding the progress made since 2006 in accomplishing the Global Europe agenda, important experiences have been acquired and lessons learned, which will feed into the EU’s future trade strategy.

Ralf Grahn

Addition 27 September 2011: Actually this series on trade started with a post in Finnish: EU:n kauppapolitiikka valokeilassa maanantaina 26.9.2011.

Monday, 26 September 2011

European Day of Languages 26 September 2011 is Bloggingportal day

It is time to remember the annual 26 September European Day of Languages, now into its 10th edition. Language learning is at the heart of the objectives, so become inspired.

The European Day of Languages is arranged jointly by the Council of Europe and the European Union, as well as by a plethora of organisers in the member states.

Why not make a good resolution by starting a daily check of the multilingual aggregator of euroblogs,, with 853 blogs already listed? A fun and profitable way to learn languages while getting to know Europe from new angles.

Today, 2011 CE could also be your Day of Multilingual Blogging.

Ralf Grahn

Sunday, 25 September 2011

Finland joining EU: Committed leaders Esko Aho and Paavo Lipponen

Finland applied for EU membership in 1992 and joined the European Economic Area (EEA) from the beginning of 1994, but was not content to stay at that level. Thus, Finland pursued full membership and became a full member of the European Union on 1 January 1995, together with Austria and Sweden. In a 1994 referendum, 57 per cent of Finnish voters had approved joining the EU.

(The integration process was not easy for the so called neutral or non-aligned countries. The Swiss derailed the EEA membership and further EU integration in late 1992, leading to a jungle of bilateral treaties on individual issues. The Norwegians rejected accession to the European Communities/European Union for the second time in 1994, remaining at EEA and EFTA level.)

The relations between the acceding Austria, Finland and Sweden (and Norway) with the EU are documented in the 1994 accession treaty.

Finnish EU accession and the formative early years were marked by two prime ministers.

PM Esko Aho

During his time as prime minister of Finland (1991-1995), the young Esko Aho grew into a statesman facing down two historic challenges. His government turned the tide on the deep economic depression of the early 1990s, even if the impopular budget cuts led to election defeat in 1995. In 1992 Finland applied for EU membership and joinded the European Union from 1 January 1995, despite vocal opposition within Aho's own rurally based Centre Party.

PM Paavo Lipponen

The social democratic prime minister for two periods (1995-2003) Paavo Lipponen continued the tight economic policies of the Aho government, which enabled Finland to adopt the euro in 1999. Lipponen was a committed European statesman, as illustrated by his 2000 speech in Bruges, at the College of Europe, where he spoke of the need for a constitutionalisation process.

Before the Treaty of Nice was finalised, Lipponen proposed a broadly based Convention in order to prepare a basic constitution, after naming these crucial reform aims:

For any institutional structure we need a decision-making system that is as simple as possible, democratic, efficient and transparent. Fundamentally, our institutions must enjoy democratic legitimacy.

From Sweden to Finland

A few days ago, I wrote a short series in Swedish about the role of Sweden in the European union, collected in: Svensk EU-politik diskuteras. Then I covered the same ground and some more in English, compiled in: Sweden in European integration (recap).

The op-ed column by the Swedish minister of foreign affairs Carl Bildt and the minister of finance Anders Borg opens up fascinating questions about two-speed, one-speed, slow-speed or no-speed Europe, but perhaps these issues will have to wait.

Namely, we have a more astonishing phenomenon to look at: changing European perceptions of Finland in EU affairs. The essentials about the two dedicated prime ministers, Aho and Lipponen, offer historical background to current events. It is a story of vision and hard work, but what is taking place?

Ralf Grahn

Friday, 23 September 2011

Sweden in European integration (recap)

Sweden is fairly British in its EU politics and policies, although more pragmatic and much less abrasive. Here is a recap of some aspects of Sweden in European integration.

Sweden has a long tradition of intergovernmental thinking in international relations. Sweden is one of the top countries in almost all important global rankings, so Swedes do not always see EU standards as an improvement.


With regard to EU2020 growth reforms and sustainable public finances, the member states of the European Union have reason to use Sweden as a model, even if the Swedish government is unclear about defence cooperation, well outside the eurozone core, leading a rich-country rebellion against the proposed long term budget (multiannual financial framework MFF) 2014-2020, willing to promote enlargement with no end in sight, and opposing preassures for core countries to advance more rapidly than the 27-member EU as a whole.

The Swedish government showed its competent and pragmatic qualities during the EU Council presidency during the latter half of 2009, when the Lisbon Treaty finally entered into force (from 1 December 2009).

Ralf Grahn

Thursday, 22 September 2011

Sweden in Europe: Carl Bildt and Anders Borg stress EU unity

The blog post Sweden promotes EU enlargement no end continued the discussion about Swedish EU politics as described in the Statement of Government Policy. There are also links to the earlier blog entries in the post.

Alternatively, you can read more or less the same thoughts in Swedish, with links here: Svensk EU-politik diskuteras.

Against this background, we can now turn to what two Swedish government ministers recently wrote about the institutional cracks and challenges of the European Union.

Carl Bildt & Anders Borg

Carl Bildt is the minister of foreign affairs and Anders Borg the minister of finance. Their op-ed piece was published in the Frankfurter Allgemeine Zeitung 15 September 2011.

A tweet by the author Hanneke Siebelink - @Europewatcher on Twitter – made me notice the column. I decided to write a few posts about Sweden in the European Union before presenting the article by the Swedish ministers.

Here is the English version of the text:

Carl Bildt & Anders Borg: The dangers of two-speed Europe

In German:

Carl Bildt & Anders Borg: Die Gefahren eines Europas zweier Geschwindigkeiten


In the middle of the financial and economic crisis, Bildt and Borg chart a route through fiscal prudence and structural reforms to competitiveness:

States with deficits must pursue serious, substantial, and sustained fiscal consolidation, using all means available, including increased tax revenues and expenditure reductions. They should strengthen fiscal frameworks to help restore fiscal credibility. Similarly, labour and financial market reforms may be necessary domestically.

Growth-oriented restructuring must be a priority.

This is in line with the message in the Statement of Government Policy:

In times of economic crisis, the Government will underline the importance of long-term responsibility and sustainable economic policy. Respect for common rules is crucial. This is the only way we can speed up economic recovery in Europe and prevent new crises.

Unity of EU

After discussing strategic budget measures to restore competitiveness and after recapitulating some of the main actions at European Union level, Bildt and Borg arrive at the crux of their message, their rejection of a two-speed Europe. They see the risk of the eurozone 'closing its doors' on the rest of the EU countries, and they appeal for the continued use of EU institutions and procedures. Economic policy cannot be separated from the rest of the EU 'acquis':

Our existing institutional infrastructure may not be perfect, but the European Council, the ECOFIN Council, including the Euro-group, and the Commission are strong, well-respected, and effective institutions. They, together with the community method of co-ordination, have underpinned the EU's economic development.


In addition, there is no way to separate the economic reform needs of Europe from areas like competition policy, trade relations, research policies and everything else associated with the internal market that remains at the core of the European integration efforts. If separate structures undermine the cohesion of the policies of the internal market we will all suffer badly.

According to Bildt and Borg, the trend towards deciding issues within the euro group or bilaterally between countries would lead back to (even more) old-style intergovernmental coordination. Instead of a core Europe moving ahead, we might get a more profoundly divided Europe with regard to growth and competitiveness:

We thus risk seeing the emergence of a low-growth, transfer-dominated part of the union and a high-growth, more competitiveness-oriented part of Europe - and a gradual weakening of the institutional structures designed to keep Europe together. This must be avoided. It is not in anyone's interest. A great responsibility lies with the leading Euro-states - a responsibility for both the Euro-zone and the future of the wider European project.

Naturally, one part of their worries is based on Sweden being outside the eurozone and loath to lose influence, but it would appear simplistic to brush aside the arguments of Bildt and Borg without further ado. Their column opens up almost too many avenues for further discussion about the basic choices for the European Union and the eurozone.

Two-speed, one-speed, slow-speed or no-speed Europe?

What should we get, and why?

Ralf Grahn

Wednesday, 21 September 2011

Sweden proactively at the heart of the European Union?

The blog post Sweden in Europe: EU defence cooperation? started the comparison in English between the Statement of Government Policy, read by the Swedish prime minister Fredrik Reinfeldt at the opening of the parliament (Riksdag) 15 September 2011, and reality as seen from the outside.

Reinfeldt's second paragraph with EU relevance was the self-portrait 'at the heart' and 'proactive':

Sweden must be at the heart of European cooperation. Sweden must be proactive on issues that are crucial to the development of the EU. In times of economic crisis, the Government will underline the importance of long-term responsibility and sustainable economic policy. Respect for common rules is crucial. This is the only way we can speed up economic recovery in Europe and prevent new crises.

Core Europe

Being at the heart of European cooperation presumably means participation in the various core groups, which exist or are taking shape.

The previous blog post showed us that there was no readily available public information about the next steps for European defence policy and defence cooperation, including permanent structured cooperation, a possible future core.

I have seen no indication of either the first or the second Reinfeldt coalition to join the real core of European integration, the eurozone.

These are crucial issues for the development of the European Union, but can the Swedish actions be described as proactive?


If you want to read about Sweden in the European Union, in Swedish, you can find links to a few blog posts here: Svensk EU-politik diskuteras.

Ralf Grahn

Sweden in Europe: EU defence cooperation?

The Swedish prime minister Fredrik Reinfeldt read the Statement of Government Policy at the opening of the parliament (Riksdag) 15 September 2011.

It left me wondering if the government's short descriptions of its EU policies were accurate, or if consumers of public information should be offered some additional facts and viewpoints.

Three paragraphs positioned Sweden in the European Union. The first one is relevant to security and defence.

Solidarity clause

Prime minister Reinfeldt alluded to the solidarity clause, Article 222 TFEU, which entered into force with the Lisbon Treaty. Sweden is ready to help its Nordic partners as well, if struck by a disaster or attacked. Sweden expects reciprocity:

It is clear that our country will not remain passive should another EU Member State or another Nordic country be struck by disaster or attacked. By the same token, there is an expectation that these countries take similar action should Sweden be so affected.

Defence policy

However, who would wait until an armed attack has taken place? Military cooperation and preparation are better done well in advance (Si vis pacem, para bellum), hopefully preventing military aggression from taking place.

Thursday to Friday (22-23 September 2011) the defence ministers of the EU member states meet informally in Wroclaw, Poland, to discuss the priorities of the Polish Council presidency in terms of the military aspect of common security and defence policy, CSDP issues in general and the working schedule for the next six months.

In addition to military engagements elsewhere, the ministers of defence are expected to discuss issues having a bearing on the progressive framing of a common defence policy, ultimately leading to a common defence (Article 42 TEU):

* Work progress related to the development of the EU military potential
* Weimar Triangle initiative
* the “pooling and sharing” mechanism
* relations of the EU and its international partners as part of the CSDP
* relations with other organisations (NATO, UN, and the African Union)

France, Germany and Poland (the Weimar Triangle) have been joined by Italy and Spain to propose the establishment of an operational military headquarters (OHQ), through permanent structured cooperation following the veto by the United Kingdom.

A new EU defence core seems to be in the making, but I found no government information about how Sweden and Finland are going to act, nor how the Swedish minister of defence Sven Tolgfors or the Finnish minister Stefan Wallin are going to contribute to the discussion and the initiative.

Leaving the public in the dark seems a wee bit negligent.

Ralf Grahn

Sunday, 18 September 2011

End of eurozone or beginning of democracy?

Our knowledgeable guides take us on a tour of the hospice of the eurozone.


There is not a minute to spare, if we want to avoid a disaster worse than the Lehman collapse, says Europe-27etc: Madame la Chancelière, Monsieur le Président, n'ayez pas peur !

Chancellor Merkel, president Sarkozy and the rest of the leaders need to give the common euro currency the common government it needs:

C’est donc une question de gouvernement : parce qu’elle a une monnaie unique, la zone euro doit se donner un gouvernement fédéral.

Credibility requires a real representative democracy at federal level:

Seule l’alternance dans un cadre constitutionnel fédéral peut guérir nos maux, rendre à la démocratie représentative ses lettres de noblesse, offrir aux Européens, dans l’unité, le choix entre des politiques immobilistes et des politiques innovatrices, efficaces et donc crédibles aux yeux du monde entier.

Liana Giorgi

Running around like Headless Chickens, is the blog post where Liana Giorgi describes the German enterprise minister Philipp Rösler's (FDP) anti-European, anti-democratic and anti-federalism op-ed as unintelligent and populist. Something different is needed:

Coming up and diffusing negative sound bites is easier than relying upon and diffusing expert knowledge—but this is no excuse for giving into the former temptation.

FT nightmare scenario

The Financial Times earnestly discusses the nightmare scenario for the eurozone.

Business Insider and VoA on Greece

Something went wrong. After Geithner Strikes Out In Poland, Papandreou Cancels U.S. Trip And Hurries To Greece, says Business Insider.

At least this remains suspended. Voice of America tells us that EU Finance Ministers Delay Aid Decision.

Summing up

This how the Voice of America summed up two days of ministerial meetings in Wroclaw, Poland: EU Finance Ministers Fail to Agree on New Debt Measures.

The British chancellor George Osborne offered some advice from the outside of the eurozone:

I think everyone here understands the severity of the situation... People know that time is running out. The eurozone needs to know it needs a grip on the situation.

Ralf Grahn

Saturday, 17 September 2011

Eurozone blues

Who is going to be the Herostratus of the eurozone? Many are in the running if we try to follow events.

In the column Public debt in the Eurozone, Japan, and the US, professor Charles Wyplosz presented a report about the ease of accumulating excessive public debt and the difficulties in getting rid of it.

In the Financial Times, Martin Wolf wrote that the failure of Germany's leaders to explain the basic facts (deficiencies) of the eurozone makes it impossible to solve the current crisis. Germany must make the choice between a different eurozone or no eurozone. In the meantime, the ECB should act to prevent meltdown: Time for Germany to make its fateful choice.

At the US Council on Foreign Relations (CFR), Christopher Alessi presented the downgrading of French banks, their share prices being hit, the upcoming trip by US Treasury secretary Timothy Geithner to meet the eurozone finance ministers, worries about European banks generally and the probable lack of coordinated global responses, different views from both shores of the Atlantic and discordant views within the German coalition government. A banking crisis was close, according to some observers. The article offers helpful links to the stories: The Gathering Eurozone Storm.

Professor Hans-Joachim Voth wrote an overview of the European cacaphony for CNN, reminding readers that a rescue in exchange for collateral is not much of a rescue at all. In addition to Finland, other smaller eurozone countries are getting restless and disillusioned: Will the Austrians, Slovaks or Dutch break the euro?

Saturday evening eurozone blues for you.

Ralf Grahn

European Central Bank offers economic policy advice

Eurozone woes seem to be going nowhere, but there are different angles regarding the causes and remedies. The blog post Economic policy making becomes challenging mentioned the latest reports from the European Commission:

Directorate-General for Economic and Financial Affairs (Ecfin) of the European Commission: 2011 Report on Public finances in EMU (European Economy 3/2011)

European Commission (Ecfin): Interim Forecast September 2011 (14 pages)

European Central Bank

The editorial of the latest Monthly Bulletin of the European Central Bank (15 September 2011) is available in 22 official EU languages. The English version:

Editorial – 15 September 2011 – Monthly Bulletin

Uncertainty and risks abound:

... the Governing Council expects the euro area economy to grow moderately, subject to particularly high uncertainty and intensified downside risks.

The ECB does not abandon its anti-inflationary role, but it has participated heavily through market measures to shore up liquidity for banks and governments in trouble. However, the European Central Bank wants to see swift and decisive economic policy action from governments and parliaments in the euro area:

Turning to fiscal policies, a number of governments have announced additional measures to ensure the achievement of their consolidation targets and to strengthen the legal basis for national fiscal rules. To ensure credibility, it is now crucial that the announced measures be frontloaded and implemented in full. Governments need to stand ready to implement further consolidation measures, notably on the expenditure side, if risks regarding the attainment of the current fiscal targets materialise. Countries that enjoy better than expected economic and fiscal developments should make full use of this room for manoeuvre for faster deficit and debt reduction. All euro area governments need to demonstrate their inflexible determination to fully honour their own individual sovereign signature, which is a decisive element in ensuring financial stability in the euro area as a whole.

Fiscal consolidation and structural reforms must go hand in hand to strengthen confidence, growth prospects and job creation. The Governing Council therefore urges all euro area governments to decisively and swiftly implement substantial and comprehensive structural reforms. This will help these countries to strengthen competitiveness, increase the flexibility of their economies and enhance their longer-term growth potential. In this respect, labour market reforms are key, with a focus on the removal of rigidities and the implementation of measures which enhance wage flexibility. In particular, there is a need for the elimination of automatic wage indexation clauses and a strengthening of firm-level agreements so that wages and working conditions can be tailored to firms’ specific needs. These measures should be accompanied by structural reforms that increase competition in product markets, particularly in services – including the liberalisation of closed professions – and, where appropriate, the privatisation of services currently provided by the public sector, thereby facilitating productivity growth and supporting competitiveness.
Not to everybody's liking, but the ECB carries a big stick.

Ralf Grahn

Friday, 16 September 2011

Economic policy making becomes challenging

In a 2010-2014 perspective, according to the convergence programmes of the non-eurozone EU members and the stability programmes of the euro area member states, the public finances were returning to more sustainable deficit levels as a whole:

In the EU, the general government deficit is planned to fall from 6.3% of GDP in 2010, to 4.6% in 2011, 3.4% in 2012, 2.3% in 2013 and 1.4% in 2014. Meanwhile, the corresponding figures for the euro area are 6.0%, 4.3%, 3.1%, 2.1% and 1.3%.


Directorate-General for Economic and Financial Affairs (Ecfin) of the European Commission: 2011 Report on Public finances in EMU (European Economy 3/2011), page 38

However, both global and European growth prospects have dimmed considerably since then. According to the updated Commission forecast economic growth in the EU and the eurozone would practically grind to a halt during the third and the fourth quarters of 2011:

Ecfin: Interim Forecast September 2011 (14 pages)

The less economic growth, the more challenging the making of economic policy becomes, especially where robust and democratic structures are in short supply.

Ralf Grahn

Thursday, 15 September 2011

Finland: budget disciplinarian seeing red

In the world of intergovernmental EU economic and eurozone politics, Finland is seen as one of the disciplinarian hawks alongside Germany, Austria and the Netherlands.

However, the return path to sustainable public finances is slow and difficult.

Yesterday evening, the Finnish ”six-pack” government agreed on its budget proposal for next year, after only a day of cross-party talks.

The 2012 budget of Finland promises to be EUR 7.1 billion in the red, which is 13.6 per cent of total central government expenditure amounting to EUR 52.3 billion.

The government points out that the projected 2011 central government deficit is EUR 8.2 billion, so the deficit decreases by more than a billion in absolute terms in 2012. The improved balance is based on expenditure cuts as well as increased revenue through economic growth and higher taxes.

The government plans to shrink the deficit at a measured pace until the end of the electoral period, both in absolute terms and relative to GDP.

Next year the government debt of AAA-rated Finland will grow to EUR 89 billion, but about 44 per cent of GDP is still unusually low in the European Union and the eurozone.


Ministry of Finance (Finland), press release 14 September 2011: Government budget proposal for 2012, key figures in the spending limits decision and Finland's economic outlook

Ralf Grahn

Tuesday, 13 September 2011

EU permanent structured cooperation: operational military headquarters OHQ

After the UK veto against a permanent military headquarters for the European Union, is a new EU core taking shape through the establishment of permanent structured cooperation in the context of the common security and defence policy (CSDP)?

The British veto resulted in a letter from France, Germany, Italy, Poland and Spain to the EU high representative Catherine Ashton to explore ways to make progress.

Group of five

Bruxelles2 noted that the foreign ministers of Italy and Spain publicly confirmed that they adhere to the proposal by France, Germany and Poland to establish a military HQ for Europe. Following the UK veto, the new letter demands action from the high representative Catherine Ashton. According to Nicolas Gros-Verheyde, everyone knows that the counter-argument about duplicating NATO structures is rubbish: Le club des 5. Espagne et Italie rejoignent le trio de Weimar sur le QG européen (3 September 2011).

Interestingly, the Polish press release about the informal (Gymnich) meeting of the foreign ministers does nothing to enlighten us about the development of defence policy or the initiative by the group of five countries: Informal meeting of the Ministers of Foreign Affairs of the EU Member States (undated).

On EUobserver, Andrew Rettman reported on the call for action: Group of five calls for EU military headquarters (9 September 2011)

The Spanish Europa451 website published an article with some details about the letter from the five countries – France, Germany, Italy, Poland and Spain – to the high representative Catherine Ashton: España y cuatro países piden crear un ejército europeo (9 September 2011).

Public Service Europe

Yesterday on Public Service Europe, Hylke Dijkstra argued that Europe needs permanent military capabilities to respond quickly to international events, while creating efficiencies for member states; in the blog post: Why the EU needs a military headquarters (12 September 2011).


The ideas about an operational HQ have been around before the letter from France, Germany, Italy, Poland and Spain.

Sven Biscop and Jo Coelmont (Editors): Europe deploys towards a civil-military strategy for CSDP (Egmont paper 49, June 2011) suggested:

The EU could be the first to create a permanent civilian-military Operational Headquarters (OHQ), in Brussels, which could plan for and conduct both civilian and military operations and, allowing for close interaction with all relevant EU actors, could implement a truly comprehensive approach to crisis management.


Here is a description (in German) of permanent structured cooperation in the Treaty of Lisbon.

Christian Mölling described the only concrete security and defence policy reform of the Lisbon Treaty, in: Ständige Strukturierte Zusammenarbeit in der EU-Sicherheitspolitik (SWP-Aktuell 2010/A 13, Februar 2010, 4 Seiten).

Need for European action

With or without the help of the EU institutions and the national governments, there is the need for a truly European debate about the strategic defence choices concerning all citizens. Here are a few of my blog posts about the issues and the need for action.

Grahnlaw: EU military headquarters – CSDP permanent structured cooperation (9 September 2011)

Grahnlaw Suomi Finland: Finland and non-aligned in EU: With UK or Europe on defence? (9 September 2011)

Grahnlaw Suomi Finland: EU common defence: Military HQ first choice (10 September 2011)

Grahnlaw: Common European defence: some questions (10 September 2011)

Grahnlaw Suomi Finland: Rejoice! EU CSDP transparency & European Year of Citizens (11 September 2011)

Grahnblawg (in Swedish): EU: JA eller NEJ till permanent strukturerat militärt samarbete? (12 September 2011)

Ralf Grahn

Saturday, 10 September 2011

Common European defence: some questions

In the blog post EU common defence: Military HQ first choice we continued to look at the main groups of European Union members with regard to military cooperation.

Few political developments are as self-evident as a common European defence, until European politicians get involved.

Coulisses de Bruxelles

Last spring, Jean Quatremer on the Coulisses de Bruxelles blog painted a woeful background picture of how the EU governments lack the military resources and the political will to achieve results in the military field: Quelle défense pour l'Europe et pour la France ? (18 April 2011)

European Geostrategy

On the European Geostrategy blog, Sarwar Kahmeri argued that the answer to NATO’s woes is to bridge the alliance with the European Union’s common security and defence policy, and shift the responsibility for the defence of Europe and its periphery to the European Union: CSDP – the Atlantic Alliance's Saviour? (27 April 2011)


Nicolas Gros-Verheyde on the Bruxelles2 blog, dedicated to EU foreign, security and defence policy, noted the Europe day speech of commissioner Michel Barnier at the Humboldt University in Berlin: Barnier rallume la flamme de la Communauté de la Défense ! (9 May 2011)

There is an English version of the speech 'Towards a New Europe' (SPEECH/11/317), where Barnier discussed many common challenges. He pleaded for a truly European defence policy:

60 years on, work on a European defence community needs to be restarted, if necessary through the “structured cooperation” which is now possible under the Lisbon Treaty. A true military staff structure, systematically bringing together research efforts and resources, and favouring European products when purchasing equipment. All of this goes far beyond the necessary, but insufficient, cooperation between France and the United Kingdom, or between Germany and Sweden.


If there are good reasons for a common European defence, why are we still so far from achieving it?

Ralf Grahn

Friday, 9 September 2011

EU military headquarters – CSDP permanent structured cooperation

The euroblogger Jon Worth - @jonworth on Twitter – made me notice the Telegraph article by Bruno Waterfield: 'Big Five' tell Baroness Ashton to bypass Britain over EU military HQ.

Jon also had the kindness to point out that my old blog post about the legal base for deeper military cooperation between willing member states turned up first on Google search: EU Treaty of Lisbon: Permanent structured cooperation (1 February 2008).

Permanent structured cooperation history

My blog post offers the drafting history of permanent structured cooperation within the EU framework at treaty level, without dramatics.

I can only marvel at the editorial style of The Telegraph, but I think that a few comments are in order after the government of the United Kingdom vetoed the establishment of the military HQ for the European Union. See EUobserver: UK snubs Ashton over EU military headquarters (19 July 2011).

CSDP aims

The common security and defence policy (CSDP) of the European Union is an integral part of its common foreign and security policy (CFSP) (Article 42(1) TEU).

The common security and defence policy shall include the progressive framing of a common EU defence policy. This will lead to a common defence when the European Council, acting unanimously, so decides (Article 42(2) TEU).

There are still a few EU member states which describe themselves as neutral or non-aligned, there is the United Kingdom and perhaps a few other special cases.

CSDP permanent structured cooperation

Thus, the intergovernmental conference leading to the Treaty of Lisbon agreed on a formula to satisfy the countries with shared and higher ambitions in the military field.

If their military capabilities fulfil higher criteria and they have made more binding commitments to one another in the military area with a view to the most demanding missions, they shall establish permanent structured cooperation within the EU framework (Article 42(6) TEU).

Since the UK veto on the EU military headquarters prevents progress for the union as a whole, the advance group of willing countries has set in motion the procedure to establish permanent structured cooperation among themselves, according to the procedures outlined in Article 46 TEU and Protocol (No 10) on permanent structured cooperation established by Article 42 of the Treaty on European Union.

The British nationality of the EU high representative for foreign affairs and security policy, Catherine Ashton, is totally irrelevant. It is her duty to act in accordance with the EU Treaties.

European defence, NATO and the UK

If I have understood correctly, the cash-strapped US administration is experiencing a severe case of imperial overreach, and they have clamoured for the Europeans to take responsibility for their common defence, while preserving the fundamental transatlantic bridge through the NATO alliance.

It is sad that the United Kingdom, with its military know-how and resources, is dead set against participation, so the willing countries have to proceed with what they have. One more EU core is in the making.

The EU military HQ issue is but a small step, but sooner or later it will hopefully lead to a common European defence, the long term aim of the Treaty on European Union.

Ralf Grahn

Wednesday, 7 September 2011

WEF: PIIGS competitiveness rankings

Thinking about the long term prospects for the eurozone and its members. The World Economic Forum offers us fresh insight.

The Global Competitiveness Index 2011-2012 rankings for the so called PIIGS are (out of 142 countries and territories):

Portugal 45
Ireland 29
Italy 43
Greece 90
Spain 36

Ralf Grahn

Tuesday, 6 September 2011

EU: Campaigning in presidential style

If not for the ambiguous word 'stunt', EurActiv's headline description ahead of the 5 to 11 September 2011 week in the European Union would been the dream of the campaign manager for the probable next president of the European Council: Van Rompuy takes lead in eurozone crisis stunt.

Herman Van Rompuy was (s)elected president of the European Council from 1 December 2009 for two and a half years, until 31 May 2012.

The term is renewable once. Van Rompuy seems to embrace the idea of a second term (RTE).

If we look at the agenda of Van Rompuy, he happens to meet members of his electoral college, 27 persons in all with a vote: the heads of state or government of the EU member states.

Very civilised campaigning, far from the 'hoi polloi'.

Update 6 September 2011 about 09:30 EET: I have noticed that Stanley Pignal on the FT Brussels blog discussed Van Rompuy's campaign in a blog post published yesterday. Recommended reading.

Ralf Grahn

Thursday, 1 September 2011

Merkel's Germany in Europe

Update: I have posted a readable version of this article on Grahnlaw Suomi Finland, because my first experience with the new Blogger interface resulted in the text "sausage" below, and I was unable to create separate paragraphs to make the text readable. On 28 May 2009 I posted the text of chancellor Angela Merkel's speech at the Humboldt University on Europe in the blog post Merkel's Germany: The European mainstream? The following day I wrote an entry with my impressions: And Quiet Flows the Spree – Merkel's Germany in the EU. The tenor of the address, as I saw it:
The first things that come to mind are the limits set by Merkel, on the scope of the speech and the European agenda.
For Merkel, the European Union seemed to be very much a union of heads of state and government – first of all those of Germany and France – assisted by their governments. Despite this predominantly intergovernmental view, shared by most national governments in the EU member states, Merkel must have known how brittle the hopes of effective international action and internal reform on energy and other crucial issues are, but she offered no visions beyond the Lisbon Treaty. Later crises Since then, we have entered the second global financial crisis. The Lisbon Treaty has entered into force, and events have proven its shortcomings, but the Franco-German ”engine” is still focused on looking for intergovernmental solutions within the scope of the current treaties. With the governments mainly silent, outside observers increasingly question the will of the European Union and the eurozone to establish robust and democratic structures. Spiegel International Online Spiegel International Oline offers a broad compilation of thoughts about how Germany's EU policies, but also transatlantic relations, have changed during the chancellorship of Angela Merkel: Self-Important Approach Worries Berlin's Allies (31 August 2011). Democratic, very German Even now, with a population of 82 million, Germany is the elephant in the China shop, both in the European Union (502.5 million) and the euro area (332 million) (Source: Eurostat). However, Germans would be even more influential in a European federation, based on 'one person, one vote', encompassing the citizens of for instance the current eurozone countries. Should Germans be afraid of a European level representative democracy? Should anybody else reject a parliament and a government giving each voter approximately the same weight? Joschka Fischer For ideas outside the dogms of the Franco-German ”engine”, let us turn to the person who made the 2000 Humboldt speech on Europe. What does Joschka Fischer think today? His latest Project Syndicate column appeared 30 August 2011: Europe's Shaky Foundations. Fischer's analysis of the political weaknesses of the economic union, the ineffectiveness of remedies currently employed and his geopolitical views merit discussion among Europeans interested in our (or even only their own) future. Is his analysis correct? Does he offer the right remedies? Why is he vague about the democratic underpinnings of real powers at European level? These are some of the questions we as Europeans need to discuss. Bloggingportal For continuing discussion about the eurozone challenges, the future of Europe, as well as EU politics and policies, follow the new articles from 841 euroblogs on multilingual, an important part of the European public space. I invite you to read and to discuss on my four blogs about EU politics and law: Grahnlaw (EN), Grahnblawg (SV), Eurooppaoikeus (FI) and Grahnlaw Suomi Finland (EN SV FI). I am also active on Twitter (although I can follow back, only as slots become available) and on Facebook. Ralf Grahn P.S. Sorry. The new Blogger interface made the blog post into a "sausage", and I was unable to correct it by getting the paragraphs separated.