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An emerging new European political geometry

Attila Marjan

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A new political geometry is being established in the European Union which has global geopolitical relevance. The most important features of this development are the following:

          The pressing need to sustain Euro through deep economic reforms and political reforms has been and will play an important part in reshaping the institutional setup and the power distribution system in the EU;

          Germany has emerged as a new and less and less “reluctant” European hegemon;

          The United Kingdom has been and will be distancing itself from the EU. Moreover it will probably be faced with prolonged internal troubles (such as the issue of Scotland). These factors will result in loss of regional and international clout;

          France’s economic and political malaise is set to continue which will risk the country’s long established position as member of the Franco-German tandem without which no important EU-wide political reforms are possible;

          Poland, sensing the weakening of the UK and France has started to implement a new geopolitical agenda by presenting itself as a key European player both internally and externally and as an indispensable partner for Germany;

          In the second half of 2014, a new political cycle with new European Commission and European Parliament starts;

          An important new external factor is the re-emergence of an assertive Russia which will result in significant policy shifts in the EU (foreign and security policy, energy policy, and enlargement policy);

          A more clearly institutionalized two-speed Europe has become a realistic option for the Union, not at all a taboo any longer.

As a result, the EU member states (both the political class and the public) have to be prepared to accept these new political realities and also have to find institutional and political solutions to handle issues such as the future role of the UK in the European construct, the relations with Turkey, Ukraine and Russia, and to guarantee the long-term sustainability of the common European currency.

 

A radically different European political framework is appearing before our eyes. And in this new space the role of Europe’s major powers will change, and there will also be a shift in the relative weights of countries. Germany will be the greatest beneficiary of the rearrangement: it will clearly be the regional primate. Almost right across the spectrum, the German political elite supports closer integration, which will assist in mitigating fears of German hegemony, but the German-French tandem will no longer be regarded as a partnership of equals. History (and necessity) has made the economy – and the common currency – the driving force of federalism, rather than political institutional development or the construction of a European cultural identity, which would have favored the French.

 

The French wanted the euro – and the whole process of integration – as a means of keeping the Germans in check, but in reality the opposite happened. The principles of France’s European policy – the multiplication of French power and capacities at the European and global levels and categorical inter-governmentalism – have been sorely wounded. France’s elite must decide what to do with an EU in which Germany is once again powerful and where the supranational principle is coming more and more into view. Without the French, there is no Core Europe, but they too are aware that it will be called “Kerneuropa”.

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the German political elite supports closer integration, which will assist in mitigating fears of German hegemony, but the German-French tandem will no longer be regarded as a partnership of equals

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Germany (“being too big to hide, too suspicious to lead”) needs to redefine its European and global role. The two are obviously very much interlinked. It seems obvious that the low profile it has been performing in global and especially regional issues is no longer an option. During the Eurocrisis its pivotal role in the EU has become crystal clear. So has the weakness of France, who also needs to redefine its European role, which will probably mean the acceptance of the fact that not even pretending to be equal with Germany is credible. In any case Germany will need partners in the so-called European construction, since no one will tolerate any unilateralism and rightly so.

 

Germany has made efforts to keep the UK on board but it seems more and more improbable. In the new European space, the United Kingdom will probably be the biggest loser. In late 2011, British politicians accepted the multi-speed model, having excluded themselves from the first time by not signing the Stability Treaty that sets new rules for the economy. True, the British immediately began organizing a bloc of non-euro-zone members around themselves, but this will have no real significance in the future. It suffices to mention the failure of EFTA or to consider Poland’s ambition to join the euro zone. The British loss of weight in Europe will not be counterbalanced by their “special relationship” with the United States – which has anyway become rather empty, particularly under the Obama administration. Indeed, by turning their backs on Europe, they may even be risking an acceleration of Scotland’s journey to independence. The UK legally is inside the EU, but not psychologically. No matter if the vote on its EU-membership takes places or not in 2017, the question of UK’s place in Europe will not go away. Most probably the answer to this question will be a no.

 

So the UK is distancing itself from integration, thereby creating an environment to press on with establishing Core Europe inside the EU-28. For eurozone key countries surrendering more of their sovereignty will be far less painful than a euro meltdown. Chancellor Merkel seriously believes that the demise of the euro would be the downfall of the EU[1]

With the UK drifting apart and France being bogged down in its economic malaise that prevents it to focus on long-term European strategy, a new candidate has emerged to come to the rescue, namely: Poland. It is obvious that Poland is no match to the UK or France on any important counts (economy, diplomacy, military) and it is not even inside the elite club of the EU, the Eurozone, nevertheless, sensing the shifts in the political status quo inside the EU, their main thrust is to get as close to the key political decisions and to Germany as possible. This entails that, although Poland does not yet fulfil the Euro-entry criteria it pushes hard with the issue, and primarily not for economic but for political reasons. Not only because more and more issues are decided within the Eurozone leaving the non-euro countries out, but there is a good chance that a more pronounced and politically diverging two-speed system will emerge of which the natural (although not perfect) basis may be the currency union.

 

One has to be clear: it is extremely difficult to foresee future developments, especially the specific positions of the various member states if, or when, the quantum leap occurs. It is a fact, however, that barely a year ago no one could have imagined the member states taking action so soon to amend the Lisbon Treaty, the adoption of which had been associated with so much grief and pain. Yet this is what has happened. In the long term, however, tiny steps will not be enough to deal adequately with the challenges of an increasingly heterogeneous union operating in an environment of growing uncertainty.

 

The current 18-member euro zone itself is far from being a certainty in the long term, as economic weakness in Greece and a potential referendum in Ireland (if tax harmonization will be requested to reinforce economic policy co-operation among members of the currency union) will probably lead to the exit of those countries from the zone. For the latter, this will also amount to a failure of its efforts to secure independence from the UK. Other euro zone members (in the south and the east) may well find themselves in a similar situation if they are unable or unwilling to keep pace with what is required of them.

 

If economic and political developments in the long term so dictate, in theory, there is a possibility that the EU – having admitted to its inability to operate the monetary union properly and acknowledging the market and political risks – will withdraw the euro from the market intentionally, doing so with a professionalism to match that displayed at the time of the euro’s introduction ten years ago. But this is only a theoretical possibility; in practice, it is almost unimaginable. So the present generation of political leaders of Europe, the generation, which appears to have lost the globalization contest, will have no choice but to act, to escape forward towards a (multi-speed) political union. Of course, all of this is an extremely dubious project plagued by many uncertainties.

 

Economy and politics walk hand in hand in the process of European integration. This has been clearly seen during the years of the euro crisis. During the worst crisis ever experienced by the EU as from 2008, the euro was not seen as the solution, rather than the source of the problem. But in fact, the lesson from the recent malaise is that the policy system behind the common currency needs significant reinforcement.

The euro is one of the most sophisticated results of the process of modern European integration. It is also a symbol of peaceful collaboration between European countries, which has been accompanied by, or has resulted in, unprecedented levels of peace, stability and prosperity in Europe.

In order to restore confidence in the single currency zone, a high-level fiscal union must be created, which may require further measures of economic integration, such as the creation of a European finance minister, a far bigger EU budget, and an effective bank supervisory authority at euro-zone level. Not all members will be able or willing to go that far in the medium term. A two-speed Europe – as we saw it- has already come into existence in reality with the UK’s decision to stand aside.

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The European Union has tried to establish a monetary union without a political union, but it has become increasingly clear that both are needed – or neither

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Nevertheless, the dynamics of integration is uncertain. This is partly because the alliance between the 18 current members of the euro zone is not a stable formation per se; for many of them, the bar will be set too high, and they will not be able to accept the degree of harmonization needed. An additional factor is that integration is to proceed on an intergovernmental – rather than supranational – basis, and there will be a need to clarify the roles of the EU bodies, in particular that of the European Commission.

By creating the euro (which was in many – especially in economic – respects either an irresponsible enterprise or a visionary act, depending on one’s perspective), Europe crossed the Rubicon: it pushed integration to a point of no return where it either presses on with a fiscal and economic union or must bear the dire economic and social consequences of a break-up of the common currency. As Ottmar Issing puts it: Der Euro “is still an experiment whose outcome seems likely to remain uncertain for a considerable time to come.”[2]

 

Euro-related challenges are not only factors: Europe at the beginning of the 21st century is facing not only a financial crisis but also a political crisis (caused in part by the economic crisis). It is a political crisis in the sense that the political institutions established after World War II, including those of the EU, have lost the confidence of the electorate. Society and the economy are undergoing rapid change. For many, such change is an opportunity, but for even more people it is a threat. This undermines society’s confidence and leads to the chronic rejection of political institutions and a widening of the chasm between the elite and the man in the street. The welfare model that was designed to prevent a repetition of the disastrous social problems of the interwar period is now in a crisis, thereby jeopardizing the social peace that was based on keeping the middle-classes satisfied. This in turn has added to economic and social tensions caused by immigration and to a hysterical fear of globalization. In the view of many, globalization – or as the anti-globalists call it: the unbridled competition of dog-eat-dog capitalism – finds embodiment in the European Union. It is therefore not accidental that there is a growing rejection of European integration, accompanied by a general rejection of the political mainstream.

 

In the history of European integration, crises have acted as the triggers of major political and institutional changes. Europe and the EU face many external and internal challenges, the scale of which has grown in recent decades (greater international competition, a whole series of demographic, social and budgetary problems). Member states have often made feeble and belated responses to such challenges with delayed reforms and poor management of immigration and demographic trends. At the same time the European Union has not been more robust either (weak and eventually failed policy visions as the Lisbon program, diplomatic and geopolitical difficulties due to the lack of a common EU position, years of impasse after the failed European constitutional project, etc.)

 

Historically speaking, hostility, rivalries and war are the norm on the European continent; periods of peaceful co-existence are the exception. Also, in historical terms, modern European integration (voluntary cooperation between sovereign states, based on the respect for common laws, and which was launched after World War II with a strengthening of economic and commercial relations but with the primary purpose of pacifying Germany) is a vulnerable formation. As a consequence, peace and solidarity on the European continent may soon be replaced by growing hostility – if the economic situation deteriorates and becomes crisis-ridden in a geopolitical milieu that is increasingly unstable. The fate of the boldest achievement and symbol of EU integration – the common currency – is intertwined with the fate of integration as a whole: an anarchic collapse of the euro would be accompanied by the break-up of the EU and political paralysis in Europe.

 

The euro is fundamentally a political and symbolic creation; in its present form, it does not have firm economic foundations. In light of the above it is in the interest of the EU to save the euro by establishing a strong economic union. With its present architecture, rules and stakeholders (whether they are the EU-28, the EU-26[3] or the EU-18), the European Union is incapable of moving forward at the right speed and depth. In addition, European public opinion gives a cool reception to any initiative coming from above, from Brussels. The European Union – it seems – faces two possible scenarios in the long term. Under the first scenario, it passively allows the centrifugal forces (markets, member-state sabotage, public disinterest) to break it up or it ceases to exist in its present form, with the unplanned termination of the euro. All of this would be temporarily accompanied by an extremely grave crisis. Under the second scenario, in the extended lands of Charlemagne (Karolus Magnus) a new intergovernmental treaty may be adopted, resulting in strong economic policy integration and preserving the euro.

 

The second and third groups of countries could join later based on new conditions (which would be far stricter than they are today) if they wish so. The historical and European lesson is that regional integration projects are far from everlasting, and often the temporary break-up of a poorly designed form of integration is the key to a restructured formation that guarantees long-term survival. Historical experience shows that monetary unions are successful when they have among their members at least one economic power-house acting as the engine. Central institutions are also needed to control and enforce the rules.

The most successful ones are preceded by a political union, as in the case of the USA, the UK or Germany. Price and wage flexibility is a fundamental criterion, so that wages can be limited in poorly performing regions, just as inter-regional transfers can be useful. Fixing and applying criteria on economic convergence also prove to be necessary. In the Eurozone, we can hardly talk about real flexibility of labor markets, just as we cannot talk about a political union either. The EU budget is not designed for major income transfers either, as it only disposes of 1% of GDP. The Eurozone meets all of the remaining conditions. The US federal budget is around EUR 3.3 trillion, compared with the EU “federal” budget of roughly 120 billion euros, a good part of which is transferred to non-Eurozone countries. The difference between the internal transfer capabilities of the two monetary unions is obvious. In any case, the euro was created by politics. Politics must also help preserve it. As André Sapir and Jean Pisani-Ferry put it: the euro area needs fewer routine procedures and more ability to act in times of real crises[4].

The question is whether the present crisis, which threatens the existence of the most important achievement of European integration – the common currency – will lead to a “quantum leap” towards closer political integration and a multi-speed Europe. It may indeed result in any of the two.

 

In any case in the medium term, Europe must prepare itself for a decade of sluggish economic growth. The gap in economic, social and political development within the Eurozone will only widen unless there is a major change of direction in the integration process. In the long term, the European welfare state is unsustainable in its present form (cf. ageing and shrinking populations, budgetary over-extension, an increasing competitive disadvantage vis-à-vis Asia). For this reason alone, it would seem sensible to pool European resources and to aim for a common European political and geopolitical agenda. But that will be the result of economic necessity rather than rationality.

 

A lot of discussion is taking place about political union. But one thing has to be clear: not any form European political union should or could mean the formation of a regional world government or the elimination of Europe’s nation states. The nation state is a European invention, and Europe’s nations will never be dissolved into an all-embracing pan-European political unity – if for no other reason than because for Europeans a sense of European identity barely exists, and Europe does not have a common language like the United States does. Political union could mean closer political integration, a real common foreign policy, a real European (or Eurozone) president, real European parliamentary elections, a real (perhaps Eurozone) budget, and a truly common economic policy. It could also mean unified European representation (a single seat and a single voice) in international organizations as well as stronger pan-European symbolism in daily life. The euro would still not be backed by a real country, but there would be regional integration with a far stronger political profile.

Currently, the key question concerning the future of European integration is whether or not a currency without a country is viable. The European Union has tried to establish a monetary union without a political union, but it has become increasingly clear that both are needed – or neither. Some thought that this ambiguous situation would lead to a great crisis, forcing the EU to establish closer political integration. That is to say, what cannot be achieved through nice words, will happen under pressure – as has been the case so many times before. Angela Not only is the common currency without a country; it also has no backing in the form of political institutions or even the basic foundations of economic integration. The EU barely has a budget: in a modern market economy, the budget amounts to 40-50 percent of GDP, while the EU budget amounts to just one percent of European GDP. Moreover, money is not spent on things that a “normal” budget would target, but for very different purposes, such as farm subsidies – which still account for almost every second euro spent. These factors add up to a budget ill equipped to make significant transfers between Eurozone members at different levels of development and in different stages of the economic cycle. An even more important deficiency of the Eurozone is its lack of a common economic policy and the cumbersome decision-making with unanimity required, for instance, to adopt common fiscal rules.

 

A closer union in fiscal and economic policy terms – a European finance minister, Eurobonds, common financial supervision, a closely coordinated economic policy – seems inevitable, as does, in certain respects, a political union. All this will require a new treaty, an amended ECB statute, and above all political will. Closer integration may certainly be envisaged in the form of a multi-speed union.

 

Despite its undoubted successes, modern European integration is – in historical terms – a fragile construct. The main reason for this is the absence of a precise self-definition. Europe is still a nascent formation, consisting of political compromises, a common system of law, a common economic zone, and a collection of political and institutional responses to crises. Although the peoples of Europe have lived side by side for thousands of years, they do not share traditions, living myths, a common identity or language; nor do they project a single image towards the outside world. The political class and the intellectual elite are just as divided: some want more Europe, while others think that even the present level of cooperation is far greater than desirable. The underlying reason is that no one has a clear picture of the function, goal and future development of the EU; there is no agreed vision. Several political analysts and European politicians themselves are skeptical regarding the need for a declared political vision for the European integration. It seems that this view is less and less sustainable.

 

Member states and EU institutions will have to agree on how to guarantee the long-term sustainability of the common currency, and how take the European citizens on board for this especially because most of the steps need to be taken will have significant consequences on national sovereignty. This is in itself a colossal task: the result of the 2014 European elections clearly demonstrated the fatigue or even the enmity of the public vis-à-vis the European project. Nevertheless the grand design of an institutionalized two-speed Europe that makes room for the UK, and maybe Turkey and Ukraine will also have to be on the menu. During the political cycle that starts in the second half of 2014 in Brussels, the economic, political and geographical setup of the EU will be looked at and probably will be significantly rearranged.


References

          Issing, Ottmar: Europe: Common Money – Political Union? European Central Bank, 1999. Frankfurt

          Judt, Tony: Postwar – A History of Europe Since 1945. Pimlico, London, 2007.

          Khanna, Parag: The second world – empires and influence in the new global order. Random House, New York, 2008;

          Marján, Attila: Europe’s Destiny. Johns Hopkins University Press, 2010, USA;

          Marján, Attila: The Middle of the Map. John Harper Publishing, 2011, London

          McCormick, John: The European Superpower. Palgrave Macmillan, 2007.

          Mennon, Anand – Schain, Martin A. (ed.): Comparative Federalism – The European Union and the United States in Comparative Perspective. Oxford University Press, 2006.

          Moisi, Dominique: The Geopolitics of Emotion – How Cultures of Fear, Humiliation and Hope are Reshaping the World. The Bodley Head, London, 2009.

          Moravcsik, Andrew: Europe: Quietly Rising Superpower in a Bipolar World. Princeton University, 2009. www.princeton.edu/~amoravcs/papers.html

          Pisani-Ferry, Jean – Posen, Adam: The euro at 10: The Next Global Currency? Bruegel/Peterson Institute for International Economics, Brussels, 2009.

          Pisani-Ferry, Jean, et al.: Coming of Age: Report on the Euro Area, Bruegel Blueprint 4. p.4. 2008, Brussels

          Siedentop, Larry: Democracy in Europe. Columbia University Press, New York, 2001.

          Timo Baas and Herbert Brücker: EU Eastern Enlargement: The Benefits from Integration and Free Labour Movement;



http://www.spiegel.de/international/germany/if-the-euro-fails-europe-fails-merkel-says-eu-must-be-bound-closer-together-a-784953.html

Ottmar Issing: Europe: Common Money – Political Union? p. 6. European Central Bank, 1999.

Note that the UK and the Czech Republic has not signed the Stability Treaty

Pisani-Ferry, Jean, et al.: Coming of Age: Report on the Euro Area, Bruegel Blueprint 4. p.4. 2008, Brussels

Hungarian economist, PhD in international relations. Based in Brussels for fourteen years as diplomat and member of EU commissioners’ cabinets. Two times visiting fellow of Wilson Center in Washington DC. University professor and author of books on EU affairs and geopolitics. Head of department, National University of Public Administration, Budapest.

Europe

Russia- Europe: Towards Relations of Pragmatism And Responsible Interaction

Igor Ivanov

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The perpetual topic of Russia-Europe relations was one of the central themes at the recently concluded annual Munich Security Conference. It is no secret that these relations have, for a long time, been in a state of profound crisis. This was not only caused by the events in Ukraine, even though their significance and consequences for both Russia and Europe should by no means be understated. The roots are more profound, related to both parties being unprepared to develop optimal forms of their current interaction.

Nonetheless, speeches and discussions at the Conference showed signs that the involved parties are demonstrating a certain readiness to develop an optimal model for relations. In his opening speech, Germany’s President Frank-Walter Steinmeier clearly said, “Europe should not put up with the ever-greater alienation of Russia. We need other, better EU-Russia relations.” Most European leaders speaking at the Conference agreed, in one way or the other, with the notion that the current state of relations between Moscow and its western neighbours is unreasonable and needs to be revised. As always, it boils down to the matter of what specific, mutually acceptable parameters new relations could have.

For nearly five decades, I happened to be directly involved in the practical issues of developing cooperation first between the USSR and Europe, and then between Russia and Europe. Over this lengthy historical period, the parties consecutively tested three interaction models, yet none of them ultimately withstood the test of time.

The first model, that of “controlled confrontation,” emerged during the Cold War when the USSR and Europe were divided by unsurmountable ideological, political, military and strategic barriers. Back then, the main task was to prevent a direct military engagement between the sides through reliance on the fundamental documents of the postwar world order. Where possible, the parties strove to resolve conflicts through dialogue and simultaneously build mutually advantageous cooperation. The Final Act of the 1975 Conference on Security in Europe and an entire package of treaties and agreements in arms control and confidence measures are among the starkest examples of such policy.

It should be said that, while being far from perfect, this policy made it possible to guarantee peace in Europe in the second half of the 20th century. In some way, back then, the situation in Europe was more stable and predictable than it is today. The rules of the game were acceptable for the opposite party, and dangerous “red lines” in the West and East were more evident than they are now.

The second model, that of a “Greater Europe,” was tested after the fall of the Soviet Union and the consequent collapse of the entire socialist bloc and its institutions. The Charter of Paris for a New Europe signed in November 1990 by the heads of state and government of the OSCE declared that “the era of confrontation and division of Europe has ended” and a new era of democracy, peace and unity of Europe has started. The Charter for European Security signed in November 1999 in Istanbul was intended to “contribute to the formation of a common and indivisible security space” on the European continent. This document, as well as many others, signed by Russia, the European Union, NATO and other parties, was the foundation for establishing far-reaching plans to build a Greater Europe, a Common space stretching from Vladivostok to Lisbon and shared spaces in various cooperation areas, etc.

These developments transpired in front of our very eyes and, to our profound regret, never materialized. Today, after some time, we can objectively assess the steps of Russia and Europe after the Cold War to establish cooperation within the framework of a new reality. Without attempting to shift the blame on the other party, we can confidently say that the different interpretation of both the unfolding historical events and the future direction of the development of our relations constituted the key problem of our partnership.

Without focusing on the details, perhaps failures in implementing large-scale projects of building a new Europe stemmed from conceptual differences between Russia and Europe in their understanding of the fundamental principles of building such a European space, and not from craftiness and malicious intent (which also cannot be ruled out entirely). These differences became apparent and began to gain momentum as political agreements were being put into practice. Europe viewed the shaping of common spaces as the process of integrating Russia into the existing European bodies. At the same time, Russia saw it as the parties being equal participants in developing new mechanisms that accounted for new realities and the parties’ legitimate interests. Such irreconcilable stances were bound to turn into conflict sooner or later, which is precisely what happened.

The third relations model emerged after the acute stage of the 2014 Russia-West crisis. Subsequently, the European Union labelled it “selective engagement,” and this wording was included in Federica Mogherini’s “five guiding principles.” The idea was of Europe interacting with Russia where it suited Brussels interests, and opposing Russia where the interests of Moscow and Brussels diverged. On the whole, this concept was in line with Russian sentiment. It appeared that “selective engagement” would delineate mutually acceptable parameters of the “new normalcy” for a long time to come.

However, the new model appeared to have shown its deficiency as well, at least because the European Union still failed to form a united opinion on what degree of “engagement” in relations with Moscow was necessary. A new algorithm of interaction with Russia has never been elaborated in a single EU document. Additionally, the interests and capabilities of Moscow and Brussels are clearly asymmetrical; therefore, finding a mutually acceptable balance of interests in every specific area appears to be exceedingly difficult.

We believe, though, it to be far more critical that “selective engagement” essentially reduces the positive interaction between Brussels and Moscow exclusively to tactical, situational cooperation pertaining to current problems and specific, rigidly delineated areas. However, the challenges Moscow and Brussels face today are not only tactical and situational, but also strategic and long-term, and the responses, therefore, should also be strategic and long-term.

Unless they want to continue repeating old mistakes, both historians and politicians should focus their attention on past experiences. What conclusions can we draw from the past 30 years of Russia-EU relations?

Our relations should be primarily based on pragmatic assessments of current opportunities and limitations, and not on emotions. As a result of diverging history, culture, religion, and lifestyle traditions, Russia and the European Union are not ready to create common spaces in the principal areas of their activity (apart from shared spaces, say, in the humanitarian, cultural, or educational areas). Swept by the euphoria induced by the end of the Cold War, we were clearly too hasty in declaring the prospect of creating a “Greater Europe.” No matter how attractive this goal appears, we will not come close to implementing it soon.

In the current state, Russia and the European Union are tackling various development tasks that are sometimes far from being identical and can even contradict each other. This applies to politics, economy, and security. Any cooperation mechanisms will be workable only if they account for both shared interests and objectively existing diverging interests. This means that by “cooperation” we should imply combining common or coinciding interests, as well as minimizing expenses and costs stemming from inevitable rivalry and even elements of confrontation.

If this is the case, pragmatism should form the foundation of Russia-Europe relations. However, pragmatism alone is not sufficient for building stable relations. The “selective engagement” model claimed to build upon the pragmatic dialogue between Brussels and Moscow. However, the experience of the past six years demonstrated that bare pragmatism is barely different from opportunism and attempts to outmanoeuvre the partner somehow using one’s relative advantage in a particular area.

Therefore, the concept of “pragmatism” should be supplemented with the idea of “responsible interaction.” Responsibility here entails primarily the parties’ ability and readiness to account both for their immediate situational interests and their long-term strategic interests. One does not need to be Nostradamus to arrive at the obvious conclusion that the further into the future we look, the more areas of coinciding Russian and European interests we see. We should not allow the sentiment and emotions of the current moment to block the view of long-term prospects.

Additionally, “responsibility” entails accounting not only for one’s own interests, for also for those of one’s partner, as well as the broader interests of the entire international system. Both the future of Russia-Europe bilateral relations and largely the future of the world order depend on Russia and Europe today. As we think of interaction in areas such as global and regional stability, nuclear non-proliferation, combating international terrorism, managing climate and migration flow, we need to always keep our collective responsibility for the emerging world order in mind. We simply do not have the right to think that “a game without rules” or a “war of all against all” is the historically inevitable new world order.

Combining pragmatism and responsibility will require significant intellectual and political efforts of both parties. At first, Russia and Europe should embark on building such interaction mechanisms, including cooperation at the highest political level, that would promote better understanding and open up opportunities for fruitful cooperation. Naturally, such an effort should be bolstered by persistent work on all other levels and in all other venues, including joint work of officials, diplomats, military personnel, experts, and civil society activists.

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From “Selective Engagement” to “Enlightened Realism”?

Dr. Andrey KORTUNOV

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Photo: kremlin.ru

Four years ago, High Representative of the European Union for Foreign Affairs and Security Policy Federica Mogherini announced that Brussels was looking at new approaches to building relations with Moscow. These approaches would later become known as the “five Mogherini principles.” These principles represented the culmination of a long and emotionally taxing discussion within the European Union that represented the varied positions of the 28 states that made up the EU back then. A difficult compromise was made between those who favoured a hard-line approach towards Russia and those who preferred a softer approach.

“Selective Engagement” as the Foundation of the “New Normal”

It was, of course, through compromise that the European External Action Service was able to prevent a split from forming within the European Union on a crucial issue, which turned out to be a historic moment for the organization. We should note in passing that Brussels has thus far been unable to reach a similar consensus on other issues that are of fundamental importance to the European Union, such as the issue of Kosovo, the Israeli–Palestinian settlement, the civil conflict in Venezuela and the expansion of the European Union itself.

In terms of a specific policy, the most significant strategy of the European Union is the fourth of its five guiding principles – “Selective Engagement with Russia.” On the whole, “selective engagement” appeared to be a reasonably logical approach given the “post-Ukrainian reality.” Europe could not conceivably go back to cooperating with Russia the way it had done in the past, turning a blind eye to the dramatic events in Crimea and Donbass, as this would mean it was somehow condoning the “aggressive behaviour of the Kremlin.” Nor was it inclined shut itself off from Moscow completely with another cordon sanitaire, as the latter was key to solving numerous issues of European politics.

The judicious decision was thus made to work with Russia only when and where it would serve the specific interests of the European Union. Mogherini’s statement touched upon potential points of contact with the Russian side, including Iran, Syria, the Middle East as a whole, migration, the fight against terrorism and climate change. “Selective engagement” can be compared to a “buffet” in a restaurant, where patrons serve themselves from a wide selection of dishes instead of being offered a set meal from the menu.

As far as we can tell, the principle of “selective engagement” was mostly supported in Moscow, albeit with little enthusiasm. Generally speaking, cooperation between Russia and the European Union was primarily selective before 2014 anyway, and the prospect of creating a unified “Greater Europe” had more or less fizzled out by the end of the 2000s. This is why, three months after the “five guiding principles” had been announced, the Russian side presented President of the European Commission Jean-Claude Juncker with a list of proposals regarding possible areas of “selective engagement” during his visit to the St. Petersburg International Economic Forum.

Of course, the proposals that had been prepared for Juncker primarily reflected the interests and priorities of the Russian side. Thus, there was already friction about who would put on the spread for the “buffet” and who would fill their plates. Nevertheless, cautious hopes were expressed in 2016 that the new approach could indeed work, at least for a transitional period.

Four years down the line and we have no option but to conclude that the principle of “selective engagement” has enjoyed limited success in relations between Europe and Russia, if any at all. Not a single “road map” or holistic strategy has emerged from it over these past four years, nor has it served as the basis for marking out “red lines” in bilateral relations. In fact, “selective engagement” has remained nothing but a general political declaration on the part of the European Union. Relations between the eastern and western parts of Europe continue to be built by fumbling around in the dark, through trial and error. And since no one wants to risk making a political faux pas, there is no great desire to try something new. Any step forward is taken with enormous difficulty, political inertia extinguishes new ideas, and discussions of Europe–Russia relations increasingly come down to rehashing old, worn out and decrepit initiatives that were bandied around two, three and even four years ago.

It would hardly be fair to blame certain politicians or public officials or even single out individual EU members for the apparent shortcomings, if not the complete failure, of “selective engagement.” These shortcomings are, in our estimation, associated with quite objective circumstances.

Why Mogherini’s Fourth Principle Failed

First of all, there is nothing close to a consensus on either side as to what degree of “selectivity” would be optimal for engagement. There are two distinct camps in the European Union. The first is made up of those who advocate the “historical reconciliation” of Russia and Europe, while the second consists of those who want to stand up to the “Putin regime.” This division remains. Little has happened in the past six years to convince either camp to change its tune or alter the balance of powers between Europe’s “hawks” and “pigeons.” Neither Donald Trump’s victory in 2016, nor the results of the 2019 European Parliament elections, nor the decision of the United Kingdom to leave the European Union in 2020 managed to shift the equilibrium in Brussels.

This is why the European Union merely continues to renew the 2014 sanctions, each time announcing a victory for “European unity.” Agreeing on such an important and very specific issue as the feasibility of building the Nord Stream 2 pipeline has proved impossible. Perhaps this is why the substantive content of the “selective engagement” with Moscow has never been brought up as a topic for serious political discussion in Brussels. After all, any discussion in this vein would inevitably jeopardize the much-vaunted “European unity,” laying bare the fundamental incompatibility of opinions within the European Union regarding the state of and prospects for relations with Moscow.

While a fierce behind-the-scenes struggle has raged among individual EU member states for the last four years in Brussels regarding the limits and possibilities of “selective engagement” with Russia, in Moscow, the concept of “selective engagement” continues to be a field of an equally fierce confrontation of influential institutional and group interests. Europe does not have a consistent long-term strategy with regard to Moscow, but Russia does have such a strategy with regard to Brussels.

In some cases, the confrontation between Moscow’s “Europhobes” and its “Europhiles” even spills over into the public space. For example, existing official and semi-official assessments of the impact of the EU sanctions and Moscow’s countersanctions on the Russian economy, as well as estimates regarding the success of the import substitution strategy vary greatly, from the clearly alarmist to the unabashedly triumphant. If the parties cannot work out their own positions on the matter, then how can we expect them to find common ground in negotiations with one another?

What is more, Russia and the European Union are very different players on the international stage, with different comparative advantages and different sets of instruments of power and influence. Significant asymmetries of both interests and opportunities between the “Russian elephant” and the “European whale” are inevitable. And this makes it extremely difficult to find a “fair” balance of interests in each specific case. For example, Mogherini talked about the desirability of working with Moscow on the issue of North Korea, but what exactly can Brussels offer Moscow in this area? Moscow, for its part, is trying to get the European Union to recognize the Eurasian Economic Union (EAEU) as an equal partner; however, the economic potential of the EAEU is minuscule compared to that of the EU.

Moreover, while Moscow takes pride in its sovereignty and the fact that it can make independent decisions, the sovereignty of the European Union is limited one way or another by the one-sided nature of its relations with the United States. And this means that attempts to create a balance between the European Union and Russia will ultimately turn into a far more complicated game involving the decidedly scalene Brussels–Moscow–Washington triangle. Even if there is still some hope for the “Russian elephant” and “European whale” to come to an agreement, the “American tyrannosaurus” will do its best to make sure that does not happen.

Finally, we should not lose sight of the fact that “selective engagement,” as well as the balanced exchange of mutual concessions and the tactical coordination of the positions of the parties, are mainly applicable as mechanisms for resolving specific issues in the here and now. For example, offering mutual concessions on the post-conflict reconstruction of Syria, salvaging the Iranian nuclear deal or resolving issues related to the de-escalation of the Libyan Civil War are acceptable solutions. These areas can, to a certain degree, be isolated from the general background of relations, while at the same time preserving individual islands of cooperation in the vast ocean of confrontation.

But the fact of the matter is that the most fundamental challenges facing Russia and Europe are not tactical, but rather strategic in nature. These include the reduced clout of the two sides in the world economy and population, the technological inferiority of Europe and Russia compared to North America and East Asia, the rise of political populism and radicalism, the long-term decline in stability in neighbouring regions, etc. In confronting these challenges, trading specific concessions and negotiating tactical compromises do little. Such agreements are not a substitute for a common vision of the long-term future of Russia–Europe relations and, more broadly, a shared view of the direction in which the world is headed. Agreements on specific issues should, in one way or another, be embedded in this common vision.

Nikolay Chernyshevsky vs Immanuel Kant

Anyone in Russia who has at least the vaguest memories of reading Nikolay Chernyshevsky’s didactic novel What Is to Be Done? at school ought to remember the theory of “rational egoism” that he loved so much. Nothing can be done about a person’s inherent egoism, and there is no point hoping for them to change their nature and suddenly become selflessly altruistic. Chernyshevsky was a militant atheist and categorically rejected the existence of Kant’s “moral law” in such people.

However, according to Chernyshevsky, people do not come into conflict with one another because of egoism as such, but rather because of how they perceive their own interests. Most people are so focused on achieving their near-term goals, serving their basic instincts and acting in a reactionary manner that they not only ignore the interests of those around them, but also effectively neglect their own longer-term ambitions. This inevitably impacts both the egoist’s environment and the egoist himself.

“Rational egoism” proposes articulating these interests in a “rational” manner, that is, by taking the interests and wishes of others into account and building a rational hierarchy of diverse desires, propensities and personal tasks – all without denying a person the opportunity to pursue their own interests. Reason softens the most dangerous and destructive manifestations of egoism without encroaching on the fundamental features of human nature.

As applied to international relations, the theory of “rational egoism” could be interpreted as “enlightened realism.” An analogue of Kant’s “moral law” in this case would be the unity of fundamental values between Russia and the European Union. However, since the European and Russian elites are never going to agree on values, relations should be built on interests instead. That is, not on non-dogmatic religious views of Immanuel Kant, but instead on the atheist rationalism of Nikolay Chernyshevsky.

It would seem that the theory of “enlightened realism” could complement “selective engagement” as a platform for the development of EU–Russia relations moving forward.

Why We Need “Enlightened Realism”

The noun realism in this formulation implies a sober assessment of the specific moment we are experiencing, as well as the constraints associated with it. We cannot go back 20 years to the “honeymoon” period of Moscow–Brussels relations. And even if we could, it would only mean a return to a situation of “bad infinity” and the very same problems that continued to pile up and eventually led to the 2014 crisis. “Realism” forces us to acknowledge that, in all likelihood, we will not be able to find a solid institutional basis for developing relations that is acceptable for both sides in the foreseeable future.

Relations between Europe and Russia are going to be shaky for a long time to come, regardless of the paths of political transit that have already been embarked upon in the East and the West. Irrespective of who will be in power in Moscow and Brussels five or ten years down the line and regardless of whether or not we can reach a fair and satisfactory solution to the “Ukrainian issue” during this time. The difficulties are caused by differences in geographical location, historical experience, existing traditions and the psychologies of the respective peoples. We cannot merely draw up some kind of framework agreement or charter to get past the crisis; this did not work in the past, and it will not work now.

The noun enlightened places the concept of “realism” into a certain framework. To be sure, the politics of Donald Trump can be characterized as “realistic” (and also pragmatic, transactional, self-centred or cynical – underline as necessary). However, Trump’s “realism” is in no way “enlightened.” “Enlightened realism” means that the sides should take both their tactical and immediate interests, as well as their strategic and long-term needs, into account.

Foreign policy decisions should be made not only with a view to the next presidential campaign or how the general public might react, but also with an understanding of the strategic challenges, opportunities and priorities facing the sides. The further into the future we are prepared to look, the greater the number of areas of common interest between Russia and the European Union we will find.

What is more, “enlightenment” implies that the parties have to be mindful not only of their own interests, but also of the interests of the system of international relations as a whole, since the destruction of this system does not bode well for Russia or Europe. No tactical victory can outweigh the strategic costs associated with the destabilization of the global system, the breakdown of international organizations, the degradation of international law, and the transition to a “game without rules” where “every man” is “for himself” in world politics.

This understanding is especially relevant today, when other leading centres of power in world politics (the United States, China and India) are, for various reasons, not ready to bear the responsibility for preserving regional and global stability. It is in these conditions that Europe and Russia are inevitably assuming greater responsibility for maintaining peace and resolving conflicts in such regions as the Middle East and North Africa.

Let us stress once again that we are not talking here about abandoning “selective engagement” once and for all. Engagement will continue to be selective for the foreseeable future, as the only alternative would be no interaction whatsoever. The task right now is to give this engagement a new depth, greater clarity and a fresh perspective. Figuratively speaking, we are talking about moving from two-dimensional interaction to three-dimensional interaction, or, in other words, leaving the rowdy market square where narrow-fisted buyers haggle prices with dodgy traders for the tranquillity of university laboratories where we can start designing the future European and world order.

This will require a qualitatively different level of interaction between the two sides both at the level of political leadership and at the level of diplomatic missions, ministries of economy, independent experts and non-governmental organizations. Not a return to the rather meaningless biannual EU–Russia summits, but the beginning of practical work on the implementation of large, forward-looking joint projects.

The only way that the principle of “enlightened realism” can work in the engagement between Europe and Russia is if the sides endeavour to apply it to themselves first and foremost, and then to the other party. After all, “enlightened realism” is not about making concessions to the other side or surrendering one’s position. Rather, it is merely a more extensive and less opportunistic understanding of one’s own interests. Right now, both Brussels and Moscow are following in the spirit of Oscar Wilde’s famous words: “[T]he nuisance of the intellectual sphere is the man who is so occupied in trying to educate others, that he has never had any time to educate himself.”

From our partner RIAC

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Europe

Shaping Europe’s digital future

Ursula von der Leyen

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Photo: European Commission

I am a tech optimist. My belief in technology as a force for good comes from my experience as a medical student. I learnt and saw first-hand its ability to change fates, save lives and make mundane what once would have been a miracle.

We now take for granted that we can take an antibiotic when we have an infection or go for an x-ray or MRI scan when we get injured or sick. These are all miracles that have changed the course of humanity for the better.

Thanks to technology, these miracles are becoming more breathtaking and more regular by the day. They are helping to better detect cancer, support high-precision surgery or tailor treatment for the needs of each patient.

This is all happening right now, right here in Europe. But I want this to be only the start. And I want it to become the norm right across our society: from farming to finance, from culture to construction, from fighting climate change to combatting terrorism.

This is the vision behind the new digital strategy that the European Commission will present this week.

We believe that the digital transformation can power our economies and help us find European solutions to global challenges. We believe citizens should be empowered to make better decisions based on insights gleaned from non-personal data. And we want that data to be available to all – whether public or private, big or small, start-up or giant. This will help society as a whole to get the most out of innovation and competition and ensure that we all benefit from a digital dividend. This digital Europe should reflect the best of Europe – open, fair, diverse, democratic, and confident.

The breadth of our strategy reflects the scale and nature of the transition ahead of us. It covers everything from cybersecurity to critical infrastructures, digital education to skills, democracy to media. And it lives up to the ambition of the European Green Deal, for instance by promoting the climate neutrality of data centres by 2030.

But, as we will set out this week, the digital transformation cannot be left to chance. We must ensure that our rights, privacy and protections are the same online as they are off it. That we can each have control over our own lives and over what happens to our personal information. That we can trust technology with what we say and do. That new tech does not come with new values.

I fully understand that, for many, technology – and especially those who own it – have not yet earned that trust. I see how that can break down when big online platforms use their own customers’ data in ways they shouldn’t. Or when disinformation drives out responsible journalism and clickbait matters more than the truth.

So I get and respect why some people are tech sceptics, doubters or even pessimists. And this is why I believe we need a digital transition which is European by design and nature. One that rebuilds trust where it is eroded and strengthens it where it exists. As part of this, big commercial digital players must accept their responsibility, including by letting Europeans access the data they collect. Europe’s digital transition is not about the profits of the few but the insights and opportunities of the many. This may also require legislation where appropriate.

The point is that Europe’s digital transition must protect and empower citizens, businesses and society as a whole. It has to deliver for people so that they feel the benefits of technology in their lives. To make this happen, Europe needs to have its own digital capacities – be it quantum computing, 5G, cybersecurity or artificial intelligence (AI). These are some of the technologies we have identified as areas for strategic investment, for which EU funding can draw in national and private sector funds.

Making the most of digital and data is as important for big industries as it is for SMEs. Although the biggest ideas often come from the tiniest start-ups, scaling-up can be an uphill task for smaller European firms in the digital world. We want European start-uppers to enjoy the same opportunities as their counterparts in Silicon Valley to expand, grow and attract investment.

For this, we will need to overcome fragmentation in our single market that is often greater online than elsewhere. We need to join forces – now. Not by making us all the same, but by leveraging our scale as well as our diversity – both key factors of success for innovation.

And we will also need the resources to match ambition. This is why at this week’s European Council I will push for a modern and flexible EU budget that invests in our future – and in the research, innovation deployment and skills to bring it to life.

This will be needed if we want Europe to lead the way in the areas with the most potential, such as data and AI. This week, we will put forward our plans for both alongside our wider digital strategy.

The starting point on data will always be personal protection. Europe already has the strongest rules in the world and we will now give Europeans the tools they need to make sure they are even more in control.

But there is also another kind of data that is the uncovered, unused goldmine of the data-agile economy of the future. I am thinking of anonymised mobility data or meteorological data gathered by airliners, satellite images, but also industrial and commercial data on anything from engine performance to energy consumption.

These types of non-personal data can underpin the design and development of new, more efficient and more sustainable products and services. And they can be reproduced at virtually no cost. Yet today, 85% of the information we produce is left unused. This needs to change.

We will develop a legislative framework and operating standards for European data spaces. These will allow businesses, governments and researchers to store their data and access trusted data shared by others. This will all be done under secure conditions that create greater value for all and ensure a fair return for all.

These pools of data will in turn drive our work to promote excellence and trust in artificial intelligence in Europe. AI is already helping small companies reduce their energy bill, enabling greener, automated transport, and leading to more accurate medical diagnoses.

To help businesses big and small to harness the full potential of AI, we will invest in a network of local digital innovation hubs and in centres of excellence for advanced research and education.

At the same time, we will act to ensure that AI is fair and compliant with the high standards Europe has developed in all fields. Our commitment to safety, privacy, equal treatment in the workplace must be fully upheld in a world where algorithms influence decisions. We will focus our action on high-risk applications that can affect our physical or mental health, or that influence important decisions on employment or law enforcement.

The aim is not more regulation, but practical safeguards, accountability and the possibility of human intervention in case of danger or disputes. We successfully shaped other industries – from cars to food – and we will now apply the same logic and standards in the new data-agile economy.

I sum up all of what I have set out with the term ‘tech sovereignty’. This describes the capability that Europe must have to make its own choices, based on its own values, respecting its own rules. This is what will help make tech optimists of us all.

This article by the President of the European Commission Ursula von der Leyen was published on the occasion of presentation of Commission’s strategies for data and Artificial Intelligence.

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