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The way forward for the EU – Entice people, embrace change, engage the world

Attila Marjan

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The aim of this paper is to contribute to academic and public debate on issues critical to the future of the European Union as well as to outline recommendations addressed to EU institutions and member state decision-makers.

This concise paper may only serve as an introduction to some bottom-line ideas, without trying to summarize the ongoing academic and political debate on the subject. Nor does it claim to present extensively formulated supporting arguments for the policy actions it recommends. This has to come once the first rounds of discussions on the viability and or the necessity of the outlined actions have taken place. In most cases, actions proposed are not entirely new to public debate.

This paper does not present several sets of possible policy choices to select from, nor does it elaborate on the different “visions on the future of the EU”. It provides one single set of recommended actions, without pondering the chances of implementation.

Federalism in the EU-related discourse is contentious, and lacks a stable definitive value, therefore misleading and unhelpful, I would therefore not relate to it, nevertheless most of the policy recommendations in this proclamation point towards a more unified Union.

The European Union has a remarkably charged political agenda in a turbulent world. Russia is more and more assertive, there is a probably prolonged military crisis in Ukraine, political and military situation is escalating in Europe’s southern and south-eastern neighbourhood with imminent impact on Europe’s societies. The spectre of Grexit reflects the fact that there are fundamental flaws in the Euro project as far as its long-term sustainability is concerned which necessitates further political and economic policy reforms at EU level. Brexit on the other-hand (although the UK’s case is admittedly extreme) is a clear indication of popular disenchantment from the idea European integration. The above factors indeed hinder coordinated action to counter the ever-stronger popular sentiment and well-articulated political agendas that question the usefulness of European integration and sometimes even the basic European values. European institutions and member states suffer to focus and face these challenges including the rising anti-European and in some cases anti-democratic tendencies that will pose significant risks to European integration in the medium-term.

The key message of this proclamation is that the EU does not only need to overhaul its political priorities – which it normally does from time to time – but also needs a new approach towards its very existence, especially the way it interacts with the world and with its own citizens. Similar messages have been reiterated for a long time now by the academia and by some ranks of EU and national political classes, political action nevertheless has been scarce and slow. This to a great extent explains the rise of anti-European or Euroskeptic views.

The author of this paper holds that an overhaul of the functioning of the EU as well as of the general approach to the raison d’etre of European integration is necessary for at least three interconnected reasons:

-firstly, to establish a new societal contract by establishing trust in a disenchanted public without whom no major reforms will be possible, be it economic or political; (“Entice people”)

-secondly, to manage inherent tensions stemming from economic (e.g.: Eurozone long-term sustainability), institutional and political (both central and especially member state) imperfections that loom large in a more and more unpredictable global environment;

(“Embrace change”)

-thirdly, to reverse Europe’s gradual slide to global irrelevance (or put in a different way: to harness its economic might in geopolitics by a stronger Union foreign and military policy profile), moreover to reinforce its failing international competitiveness. (“Engage the world”)

The key determinants of EU-level policy-setting are the following:

-A new geopolitical order is on the rise. Pax Americana has started to give way to a new world order whose defining features are very unpredictable but which most probably be a more unstable one than we live in today by the major rearrangement of the global equilibrium following the rise of new powers, and with a potentially significant level of hostile competition between the key actors.

-Inside the EU major new geopolitical dynamics are gathering importance which includes a quasi-dominant role of Germany, a weakening France, a UK drifting away and in general a more and more heterogenetic and multiple-speed EU with institutions still in the process of self-redefinition.

-European societies are ageing. The old-age dependency ratio will double by 2040. At the same time, the average fertility rate in Europe is below reproduction. These factors represent serious challenges to the long-term sustainability of the European way of life as know it. Immigration as a tool to face and counter the spectre of unsustainability, mainly due to issues of social integration, as it is demonstrated in several EU member states, raises significant social and political challenges if managed badly.

-European economies and societies under pressure will probably be more susceptible to anti-EU sentiment and propaganda.

-The EU, the home to some half a billion people has no story to tell, or rather its story does not reach its citizens.

Based on the above premises, the EU needs:

-A way more unified diplomatic approach to global political developments and clear political stance on the final boundaries of the Union;

-A stronger capacity to exercise hard power; European army

-A stronger and more unified internal security policy;

-A more effective immigration policy and policies to make integration successful;

-Effective responses to negative demographic trends;

-An institutional and political setup and an economic policy framework that guarantees the long-term survival of the common currency, including a separate Eurozone budget;

-A strongly coordinated energy policy including energy diplomacy that guarantees independence, sustainability and competitiveness;

-A stronger sense of ownership and self-identification of European citizens with the European project;

-A new budgetary arrangement, a budget with a new approach that reflects this policy overhaul including the phasing out of controversial policies such as CAP and a fundamental reform of the cohesion policy and introducing a revenue that creates ownership in the society;

The list of actions proposed necessitate fundamental alterations in the way the EU exists. These alterations will probably be precipitated (or maybe to the contrary: jeopardized) by “inbuilt” political developments that are only partly foreseeable (Brexit, Grexit, Russia, Ukraine, Turkey), partly belong to the realm of a less and less predictable geopolitical environment. These alterations often will take the form of new institutional arrangements. Also efforts to reinforce the currently almost inexistent EU-wide political (democratic) sphere are poised to get stronger – in parallel with the continuous rise of anti-EU sentiment and the political articulation thereof by member state political actors.

One has to be realistic: the list of proposed action provided in this paper is not what will be, many of these suggestions seem radical and certainly contested at this point. Most probably member states as usual will look at any to do list with the well-known mind set: how could an almost certainly hopeless Treaty change be avoided, how one can muddle-through on a business as usual basis? Well, this would not lead us any far in the long-term, only towards disarray, insignificance and instability. Some (both in politics and academia) are fascinated by proposing new institutionally focused arrangements to reform the EU. While these are most of the time reasonable suggestions, people simply don’t care. They do not care or even understand why a bi-chamber EP incorporating the Council or a Eurozone budget (so far referred to in the Euro-discourse under as the ‘fiscal compact’ to make sure nobody understands it) is the magic solution. One should therefore be bold to offer things that are tangible, meaningful and educative for the citizen. One should not cynically pretend that people are fully aware of what is going on in the politics let alone international relations, they do need better information and much broader involvement otherwise no major reforms will be possible in the future.

The following is only a list of policy actions deemed desirable for a stronger and more successful Union. It is not a political itinerary, nor does it discuss in detail how these actions should be put in place. Otherwise – as experience shows – it we would end up in a scattered discourse on how this could (not) be done for political and institutional reasons before even a proper appreciation of the proposed actions could take place. Most of the proposed actions are not realistic for the EU28 as a group, they are instead policy options for member states (should things develop in that direction) of the “core”.

Next to some items on the list “B” “T” or “C” signs are visible. “B” denotes that the proposed action involves major budgetary reform and or funding, while “T” means that the action necessitates a new Treaty. “C” represents that it is only or primarily realistic or relevant for a core group of member states that are ready and able to reinforce their unity.

ENTICE PEOPLE

Getting European societies on board is a sine qua non condition for any major change. Endless complaining about the remoteness of the EU has led us nowhere and clearly no ineffective and underfinanced communication campaigns are the solution either. Instead the following actions need to be considered:

•Create post of European (Eurozone) speaker position in national parliaments (who preferably does not bear the host country’s nationality) with the right of intervention if European issues debated (T) (C);

•Introduce the instrument of European referendum – one single pan-EU referendum on the same day counted as a whole on key EU issues (T);

•Replace low-profile bureaucrats at the top of EU Representations, create high profile EU presence in capitals (C);

•If a project is financed by 51% EU it should be inaugurated by EU representative;

•Increase Erasmus spending by at least five times (B);

•Introduce preferably mandatory European values curriculum at elementary and secondary schools;

•Finish with national party lists at EP elections, vote on pan-European platform same day all across EU (T);

•Create a special channel of national parliaments at EP – as MEPs are less and less national, MPs should have a vehicle which is visible and effective to intervene at EP debate. This must be much stronger an instrument than ad-hoc invitations; an institutionalised and permanent solution is preferable (T) (C);

•Elect President of the European Commission or the European Council directly by citizens (T);

•Promote EU values abroad (joint EU cultural and political institutes – having in mind Alliance Francaise, Goethe, etc) (B);

•Facilitate national public and political debates on new European reform initiatives such as the recent one (June 2015) by the German and French economy ministers.

•Run EU joint teams (or individual Olympians) in up to 10 percent of Olympic sports by the 2024 Olympic Games;

•Support language teaching and learning; acknowledge reality: English is lingua franca of the EU, support it (B);

•Set up national offices of the Court of Justice to deal local legal matters with EU relevance more promptly and transparently (T);

•Support Europe-related news broadcasting by national broadcasters. Euronews (in a significantly enhanced quality) minutes in local channels. (B);

EMBRACE CHANGE

Here I mean a much more comprehensive change than normally envisaged by the EU in its subsequent Treaty changes, or new policy initiatives and (most of the time unfulfilled) grand programmes on a change as usual course.

•Embrace reality which is inevitable for the long-term success of the EU: declare existence of multiple (two)-speed Europe (instead of deleting the reference to an “ever closer union” in the Treaty as the UK requests), and make the institutional setup best fitted to embrace it (T);

•Let UK have a special status (T);

•Let Greece exit Eurozone (T);

•Make Eurozone exit legally possible and planned (T);

•Establish Eurozone budget of 3-5% of Eurozone GDP to use as macroeconomic buffer (T) (B) (C);

The EU budget is not only small but is not at all designed to tackle macroeconomic shocks and crisis in a monetary union, which needs a puffer for shocks and a stable transfer pool which can be deployed in a prompt manner (this may even include pan-Eurozone social benefit schemes as well.)

•Introduce European tax by unionizing a certain percentage point of national VAT rates and thereby finish with member state membership fee. (This can be budget neutral for member states at the end of the day and at the same time underpins the sense of ownership in the society). (T) (B) (C);

The annual EU budget is €142bn (2014 figures) – a large sum in absolute terms, but only about 1% of the GDP generated by EU economies every year. Traditional own resources usually represent about 12% (10,14% in 2013) and the VAT-base related own resource about 10% (9,38% in 2013) of the total budget. At present European budget is financed mostly by member states as a membership or rather ownership fee. Citizens are completely detached from the act of contributing to the common EU budget. “No representation without taxation”. In the proposed new system (European tax) some percentage points from the VAT (standard) rate applicable in member states is payed by the citizen to the EU budget. (It is important to note that this proposed revenue source is completely different from the present levy on national harmonised VAT bases which constitute a resource of the EU budget). This solution is more or less budget-neutral for member states since this source supplements the previous member state contributions (citizen’s money in disguise by the way). Citizens’ act to finance the EU budget (by buying a product or a service) should be clearly indicated for them on every price-tag. By the member state fee terminated, ownership is delegated to people. In this scheme VAT rates do not have to be augmented either only divided into national (say 18%) and EU (2%) shares. Obviously there are currently major differences among member states’ net positions in relation to the EU budget. This has to be calculated with when fine-tuning any new schemes.

•Establish Eurozone finance minister with defined veto rights over national budgets (T) (C);

A Monetary Union without a genuine economic and some degree of a political union is not sustainable. The Euro needs to be accompanied by a solid European economic governance with sufficient own resources and policy leverage. This entails a separate Eurozone budget, an EU treasury headed by a Eurozone finance minister with veto power over national budgets, the transformation of ESM into a European Monetary Fund, finalising the Banking Union, issuance of Eurobonds.

•Cut back CAP drastically (B);

The European Union will spend 373,2 billion EUR on the Common Agricultural Policy between 2014-2020. Although it indicates an 11% decrease compared to the previous EU programming period, CAP still has one of the highest shares – 38.9% – in the total EU budget until 2020. (Approximately, three quarters of the CAP budget is devoted to market related expenditures and direct payments, while one quarter for rural development.) This has to change: a drastic cut in especially direct payments needs to take place.

•Decrease and rationalize cohesion policy spending and establish more possibilities for rapid suspension in case of misuse, fraud or corruption (T);

The efficiency and usefulness of regional policy funds are controversial, dead-weight is very high, moreover they sometimes contribute to corruptive practices.

•Establish full-fledged Energy Union;

•Promote industries, technologies to cater for and institutional arrangements best suited for an ageing society;

•Establish European demography Figure (minister) to initiate and co-ordinate ageing-related policies and to deal with cross-generation tensions in the EU, helping member states to carry out tough reforms and cuts back in the welfare systems (T).

ENGAGE THE WORLD

Without credible hard power capabilities and with its soft power potential seriously underutilized the EU is scoring well under its global weight. The world is becoming less predictable and more turbulent especially at the Union’s imminent borders and close neighbourhood. Illegal immigration related issues put a pressure on European societies. Immigration’s societal consequences and relevant EU and member state policy responses are getting prominence in the daily life of EU citizens and in EU-policy discourse.

•Establish a European army in the medium to long term; (T) (C);

The European Parliament adopted the Synchronized Armed Forces Europe (SAFE) concept in 2009 to create a scheme for joint civilian and military structures and forces under EU leadership on the voluntary basis. This initiative advocates a Defence Ministers Council and a free service based European soldier status law. SAFE would be operated on joint training, tactics and procedures approved by the participating member states. Actual implementation has been almost none but the Russian aggression in Ukraine changes things. The European Corps (Eurocorps) in Strasbourg and the Corps Headquarters in Münster and Szcezin are existing elements to build upon.

•Member state should stop military spending cuts and they should aim for synergy (B);

The European defence capabilities have been gradually reduced over the years. One and a half million soldiers served in the EU member countries in 2013, half a million less than in 2006. EU countries spent only 190 billion euro (12% of total world spending) for military purposes. From 2006 to 2013, the European defence spending decreased by 15% (€ 32 billion). World military expenditure in 2013 was 1.747 billion $, around 2.4% of World GDP. However, China (188 billion US $) and Russia (88 billion US $) continuously increases the military budget. 80% of the European defence spending is by France, Germany, United Kingdom, who also reduce their military budgets.

•Reform CFSP: do away with unanimity, or at least make prompt actions possible by an easily applicable flexible institutional solution for a group of member states, something similar but more flexible than the so-called reinforced cooperation. (T) (C);

The new functions brought about by the Lisbon Treaty are modest innovations. The High Representative is very far from a European Foreign Minister, so is the European External Action Service from a European Foreign Ministry.

•Reform EU immigration policy, render it more effective, and base it on a way longer-term oriented policy approach that encompasses factors of sustainability (in a broad sense including long-term demographic and budgetary considerations) and societal sentiment (B);

For 2014-20, the overall Home Affairs budget amounts to only EUR 9.26 billion. Immigration policy is not only underfinanced but remains fragmented in the EU marred by conflicts of policy objectives, namely the paradox of the free movement, solidarity and security. The issue of legal and illegal immigration and refugees and even terrorism are often fudged in the minds of people which is sometimes reinforced by demagogic and or Euroskeptic national politics. At the same time, the growing feeling of insecurity in the society and also the failures in the integration of migrant communities in European societies are key issues to face. In 2014 276000 migrants entered the EU irregularly, which represent an increase of 138 percent compared to 2013. The number of asylum applicants registered in the EU has also increased significantly in 2014 (626.000 applications). The mandate of the EU agency EASO (European Asylum Support Office) should be significantly expanded to make it a proper Common European Asylum Service. In general for migration and asylum matters more resources have to be deployed at EU level. A special representative on migration for the External Action Service is to be established.

•Reinforce Frontex significantly (B).

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.

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EU-Republic of Korea Summit: Building on a well-established partnership

MD Staff

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The 9th EU-Republic of Korea Summit took place on 19 October in Brussels. It marked the 55th anniversary of diplomatic relations between the EU and the Republic of Korea and set the stage for a further strengthening of bilateral ties.

Jean-Claude Juncker, President of the European Commission and Donald Tusk, President of the European Council, represented the European Union at the Summit. The Republic of Korea was represented by its President, Moon Jae-in. The EU High Representative for Foreign Affairs and Security Policy/Vice-President of the European Commission, Federica Mogherini and EU Trade Commissioner Cecilia Malmström also participated, alongside several Ministers from the Republic of Korea.

“In 2011, the EU agreed its first Free Trade Agreement with an Asian country. That country was the Republic of Korea”, said President Jean-Claude Juncker. “The beneficiaries of this agreement have been our citizens and our businesses, but if our trade relationship is to reach its full potential, we need to ensure that it is being implemented properly. At the same time, we must continue to dispel the notion that protectionism protects, continue to invest in multilateralism, and continue to increase our cooperation in sustainable development and the implementation of the Paris climate agreement. I am confident that in the years to come, our relations will be even more dynamic and our ties even stronger than now.”

Presidents Juncker, Tusk and Moon committed to further develop the EU-Republic of Korea Strategic Partnership, which is underpinned by three concrete pillars: an enhanced Partnership and Cooperation Agreement; an ambitious Free Trade Agreement; and a Framework Participation Agreement for EU crisis management operations. The Summit provided an opportunity to explore further areas for cooperation within the Strategic Partnership.

Discussions focused on the situation on the Korean Peninsula, the broader situation in the world, and trade relations. The Summit also provided an opportunity for the initialling, by the European Commission and the Republic of Korea, of a Horizontal Aviation agreement and the signing of a Joint Statement committing to work closely together to fight against Illegal, Unreported and Unregulated fishing.

Jointly addressing global challenges

The EU and Korea are united by common values of democracy, human rights and the rule of law. The Leaders reaffirmed their strong commitment to multilateralism and the international rules-based order, politically and economically, while also supporting global action on climate change and the environment. The EU and Korea will continue promoting free, fair and rules-based trade, modernising the WTO-based multilateral trading system, and maintaining international cooperation against protectionism.

The Leaders discussed a number of pressing issues on the global agenda, chief among them prospects for achieving lasting peace and security on a Korean Peninsula free of nuclear weapons and finding a comprehensive solution through diplomacy, while fully implementing the relevant UNSC Resolutions. The EU supports the Republic of Korea’s efforts and diplomatic initiatives, in particular the three inter-Korean Summits and the US-DPRK Summit, and the implementation of their outcomes. The EU sees the development of inter-Korean relations, the denuclearisation of, and the establishment of a peace regime on the Korean Peninsula as vital for peace and security not only in East Asia, but for the entire world. In this context, the EU stressed the requirement for the Democratic People’s Republic of Korea (DPRK) to completely, verifiably and irreversibly dismantle all its nuclear and other weapons of mass destruction, ballistic missiles and related programmes and facilities.

The EU and the Republic of Korea reiterated their commitment to maintaining close coordination on foreign and security issues. In the field of crisis management, the EU and the Republic of Korea will continue the good cooperation under the EU-Republic of Korea Framework Participation Agreement, through which the Republic of Korea has regularly contributed to the EU’s naval counter-piracy operation off the coast of the Horn of Africa, EU NAVFOR Atalanta. Similarly, they discussed and agreed to cooperate more closely on implementing the 2030 Agenda for Sustainable Development and achieving its Sustainable Development Goals, and will bolster their bilateral policy dialogue on international development issues and promote joint cooperation in areas and third countries of mutual interest, notably in Asia and Africa.

Expanding the bilateral agenda to bring further benefits to citizens

The leaders recalled that the EU-Republic of Korea Free Trade Agreement has been an economic success that has increased wealth on both sides. The EU is Korea’s 3rd largest trading partner and Korea the EU’s 8th largest; annual trade in goods between the EU and Korea is now worth about €100 billion. With that in mind, the leaders exchanged views on how to ensure that our citizens and businesses can reap the full benefits of the agreement. The EU highlighted several important issues: for example, ensuring the full implementation of the long-standing, binding labour commitments under the Trade and Sustainable Development Chapter; opening the Korean market to EU beef from all EU Member States; and fully implementing commitments in the area of intellectual property rights, including protecting new Geographical Indications.

The Summit also provided an opportunity for the European Commissioner for Environment, Maritime Affairs and Fisheries, Karmenu Vella, and Kim Young-Choon, Minister for Oceans and Fisheries of the Republic of Korea to sign a joint statement committing to work closely together to fight against Illegal, Unreported and Unregulated fishing.  The Republic of Korea is the fourth country with whom the EU signs such a joint statement as part of its efforts to tackle the most serious threats to sustainable fishing and to marine biodiversity in the world’s oceans, with devastating environmental and socio-economic consequences. The new partnership, in line with the objectives of the EU’s Ocean Governance strategy, will help exchange information about suspected Illegal, Unreported and Unregulated activities, enhance traceability of fishery products and promote sustainable fishing through education and training.

Excellent progress has been made in the area of transport, where this week the European Commission and the Republic of Korea initialled a Horizontal Aviation Agreement on certain aspects of air services. The agreement will restore legal certainty to all 22 bilateral air services agreements that the Republic of Korea has with EU Member States by bringing these into conformity with EU law. The number of passengers travelling directly between the Republic of Korea and the EU has grown on average 10.1% over the past five years, totalling 3.4 million passengers in 2017. Currently, direct passenger flights are operated between 10 EU Member States and the Republic of Korea. The Horizontal Aviation Agreement reflects this growth in the EU-Republic of Korea aviation market and should serve as a catalyst for increased flows.

Leaders also stressed their commitment to implementing the Paris climate agreement. To translate this political commitment into concrete projects, the EU has set up a platform to exchange best practice on climate action and support the implementation of the Korean Government’s Emissions Trading System (ETS) to reach the goals of the Paris Agreement. The EU’s Partnership Instrument also financially supports exchanges of cultural practitioners and artists from both the EU and Korea, economic cooperation between companies, as well as the promotion of research and teaching on EU-related issues in Korea, adding to the overall breadth of the relationship.

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ASEM Summit: Europe and Asia – Global Partners for Global Challenges

MD Staff

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The 12th ASEM (Asia-Europe Meeting) Summit took place on 18-19 October in Brussels, bringing together 51 countries, as well as EU and Asian institutions. Under the title “Global Partners for Global Challenges”, leaders addressed some of the world’s most pressing issues.

Jean-Claude Juncker, President of the European Commission and Donald Tusk, President of the European Council, represented the European Union at the Summit. Heads of State or Government of the 28 EU Member States, Switzerland and Norway, in addition to 21 Heads of State or Government from Asian countries, as well as the Secretary General of ASEAN (the Association of Southeast Asian Nations), were also invited. The High Representative of the European Union for Foreign Affairs and Security Policy/Vice-President of the European Commission, Federica Mogherini, and the Vice-President of the European Commission for Jobs, Growth, Investment and Competitiveness, Jyrki Katainen, also participated at the Summit.

“We want to give our relationship with Asia, which is already very dynamic – as illustrated by the numerous trade and cooperation agreements we have, fresh impetus“, said President Jean-Claude Juncker at the Summit’s plenary session this morning. “Only a multilateral approach will enable us to confront global challenges. This is why I reiterate our commitment to support multilateral organisations in all their efforts, including the United Nations and the World Trade Organisation – a World Trade Organisation that we have to reform together, so that its rules correspond better to the new realities. It is by acting together that we will be able to preserve our planet […], contribute to resolving conflicts, eradicate poverty, reduce inequalities, […] and that we can better manage migration flows and develop free and fair trade.”

“What Europe and Asia agree together matters not only for the two of us, but for the entire world. Together we represent 55% of global trade, 60% of global population, 65% of global economy and 75% of global tourism; together we represent a real global power“, said the High Representative/Vice-President, Federica Mogherini at the Summit’s press conference. “We come out of this two-day Summit with a reinforced global partnership between Europe and Asia. It has allowed us to translate our global weight into concrete policy initiatives – on regional and international security, foreign policy issues, climate change action, free and fair trade, and the digital agenda to name a few. Together, we can make a real difference for the world.”

A Chair’s Statement, covering the wide range of areas discussed and focussing on ASEM’s three pillars – namely political, economic and financial, and social and cultural – has also been issued.

Sustainable connectivity between Europe and Asia

In his address at the Summit’s plenary session, President Juncker highlighted the importance of investing in more sustainable connectivity between the European Union and Asia. The European Union has this week adopted a new strategy on connecting Europe and Asia, building on the proposal of the European Commission and the High Representative in September. With financial, environmental, and social sustainability at the core of the EU’s approach to connectivity, the EU’s objective is to develop sustainable connectivity networks across the digital, transport, energy and human dimensions, as well as to strengthen partnerships at the bilateral, regional and international levels, in particular to ensure a rules-based approach and interoperability of standards.

As a contribution to enhancing Euro-Asian connectivity, as well as to demonstrate the huge potential of the relationship, the European Commission has this week launched the ASEM Sustainable Connectivity Portal, offering policymakers, researchers, businesses and other stakeholders alike a wealth of data on the political, economic and societal relationships between the two continents. A full press release and factsheet are available online. In parallel to the Summit, a number of events to bring Europeans and Asians together are taking place in Belgium, such as the ASEM Cultural Festival, the Young Leaders’ Summit, the Business Forum, the People’s Forum for civil society, the Labour Forum and the Parliamentary Partnership Meeting.

Strengthening EU-Asia bilateral ties

In the margins of the ASEM Summit, the European Union signed a number of bilateral agreements to deepen and expand its relations with Singapore and Vietnam respectively.

President Juncker,President Tusk and Austrian Chancellor Sebastian Kurz signed, together with the Prime Minister of Singapore, Lee Hsien Long, the EU-Singapore Free Trade Agreement. In the presence of the leaders, EU High Representative/Vice-President, Federica Mogherini and the Minister of Foreign Affairs of Singapore, Vivian Balakrishnan signed the EU-Singapore Framework Agreement on Partnership and Cooperation and Commissioner for Trade Cecilia Malmström and Mr S Iswaran, Minister for Communications and Information, and Trade Relations of Singapore signed the EU-Singapore Investment Protection Agreement. These agreements represent a significant step forward for a more comprehensive and mutually-beneficial relationship between the EU and Singapore, opening new opportunities for European producers, farmers, service providers and investments, as well as strengthening political and sectoral cooperation through more formal and intensive exchanges for example in environment, climate change and counter-terrorism.

The European Union is also stepping up its relations with Vietnam. Earlier this week, the European Commission adopted the EU-Vietnam trade and investment agreements, paving the way for their signature and conclusion. The trade agreement will eliminate virtually all tariffs on goods traded between the two sides. The agreement also includes a strong, legally binding commitment to sustainable development, including the respect of human rights, labour rights, environmental protection and the fight against climate change, with an explicit reference to the Paris Agreement. Today, the EU and Vietnam signed a Forest Law Enforcement, Governance and Trade Voluntary Partnership Agreement. The Agreement will help improve forest governance, address illegal logging and promote trade in verified legal timber products from Vietnam to the EU, and other markets. In addition to the variety of social, economic and environmental benefits associated with better management of the forestry sector in Vietnam, the licensing will simplify business for timber traders.

EU-ASEAN Leaders’ Meeting

Following the ASEM Summit, a Leaders’ Meeting between the European Union and ASEAN took place. President Jean-Claude Juncker and President Donald Tusk, accompanied by EU High Representative/Vice-President Federica Mogherini represented the European Union, whilst the Association of Southeast Asian Nations was represented by the Prime Minister of Singapore, Lee Hsien Loong, as the country holding the ASEAN Chairmanship for 2018, the Prime Minister of Thailand, Prayut Chan-o-cha, as the country which will hold the Chairmanship of ASEAN in 2019, and the ASEAN Secretary General, Lim Jock Hoi.

“The EU’s partnership with ASEAN is founded on common interests across many areas. We share common values – in the European Union and in the founding charter of ASEAN – which need to be respected by all”, said President Juncker at the opening of the Leaders’ Meeting. “Proof of our intense cooperation is the number of agreements with Singapore that we have just signed. These, I hope, will be the first in a long series of such agreements with ASEAN countries, and will eventually result in a region-to-region agreement.”

At the Leaders’ Meeting, alongside matters of trade, connectivity and transport, leaders addressed global peace and security challenges, including climate change, non-proliferation, the Joint Comprehensive Plan of Action – the Iran nuclear deal, counter-terrorism, maritime security and migration. They agreed to strengthen the EU-ASEAN relationship, in particular to address global challenges and to work together to reinforce the rules-based international order and multilateralism.

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A New Redrawing of Balkan Borders: A Road to Hell

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More than a decade after Kosovo region’s unilateral declaration of independence from Serbia, the issue of redrawing borders is back on the agenda. The ongoing negotiations between Belgrade and Pristina on the settlement of bilateral relations under the auspices of the European Union may lead to an unexpected result – the breakaway of Serbia’s three predominantly Albanian-populated southern Serbian regions of the Presevo Valley and their accession to Kosovo – which, in turn, will be carved up into Serbian and Albanian parts. Such a scenario, in turn, can set off disintegration processes in Macedonia, Bosnia and Herzegovina, Montenegro and even Greece (with Albanians enclaves in the north).

The Pesident of the self-proclaimed Kosovo Republic, Hasim Thaci, said that in the event of an agreement signed between Belgrade and Pristina, the Presevo Valley adjacent to the Kosovo border, would likewise join Kosovo.

According to him, “the requests of the Albanian population of the Presevo Valley for joining Kosovo are institutionalized,” and if an agreement is reached between Belgrade and Pristina, neither the EU, nor NATO or the US would be able to interfere with its implementation. Moreover, he said that the problem of Presevo will soon be discussed in Brussels anyway.

However, he once again ruled out the possibility of Kosovo proper being divided into Serbian and Albanian parts (which is increasingly being discussed in Serbian political and public circles), although he was rather vague about the possibility of “adjusting the Kosovo-Serbian border.” For his part, Serbian President Aleksandar Vucic supports the idea of carving up Kosovo, which he argues would help avoid a new conflict.

“A territory, if you don’t know how to treat it or who it belongs to, is always a source of potential conflicts and problems.” “I am foursquare behind this [separation] and this my policy, whether people like it or not. I am holding out for separation with Albanians,” Vucic stated. rts.rs.

Serbia’s current Foreign Minister Ivica Dacic was the first top-level politician to come up with the idea of dividing Kosovo, describing it as a long-term compromise solution to the Kosovo conflict. In an interview with the Pristina-based Albanian-language newspaper Zeri, Ivica Dacic, who was then First Deputy Prime Minister and Interior Minister, said that “the only real solution is to leave the Serbs in Serbia and separate the other part where Albanians live. It will be a working mechanism to quickly solve the problem. Other options will be just a waste of time.”

However, the idea of partitioning Kosovo can now become part of a broader “package” agreement on the normalization of relations between Belgrade and Pristina. The European Commission makes Serbia’s admission to the European Union, which in this case could come in 2025, strictly conditional on a legally binding agreement signed by Belgrade and Pristina.

Many media outlets consider the division of Kosovo and a territorial exchange a very likely scenario. The Croatian newspaper Jutarnji List even claims that the matter is already a “done deal,” and warns of possible negative consequences: “In fact, it’s not just Kosovo. Pandora’s box may be thrown open. This could have a knock-on effect. Just imagine the worst possible scenario the partition of Kosovo could lead to. Bosnia and Herzegovina would immediately follow suit, followed by Macedonia. Montenegro could possibly come next.” jutarnji.hr

The Albanian leaders of southern Serbian Presevo Valley, which is home to three mixed Serbian-Albanian communities, admitted the possibility of a “territorial exchange” as envisaged by pertinent agreement between Belgrade and Pristina, as early as in 2012. The leader of the Presevo community, Ragmi Mustafa, emphasized that the three communities (Presevo, Medvedja and Bujanovac) “must join Kosovo,” while “northern Kosovo must join Serbia.” He believes that a pertinent proposal should be discussed in Brussels.

“I think that this holds the future for our region,” he said. A year before that – in the summer of 2011 – representatives of Albanians living in Kosovo and Presevo Valley, including Ragmi Mustafa, met in Gnilan and adopted a resolution on “facilitating the return” of Presevo Valley communities to “independent Kosovo Republic,” including with the participation of the international community. The latter, according to the participants, would help deter the Serbian government from “obstructing the free will of the Presevo Valley population.”

Accurate and reliable data on the ethnic composition of the three communities is not available. However, if we compare the estimates, we will see that 90 percent of Albanians and 10 percent of Serbs live in Presevo, 60 percent of Albanians and 30 percent of Serbs live in Bujanovac and 30 percent of Albanians and 60 percent of Serbs live in Medvedja. Thus, Albanians now constitute an absolute majority in  Presevo and Bujanovac.

Just as the President of the Turkish International Cooperation Agency in Ankara, Umut Arik, warned as early as in the mid-1990s, all talk about creating a security system in the Balkans makes no sense until “decisions relating to nation-states can be made and revised unilaterally”. This is exactly what has recently been happening around Kosovo. What is also evident is the interrelated development of disintegration processes going on in the Balkans. This may force the leading world powers and international institutions to abandon what they have professed all these years – “a policy focused on the state, rather than territory” as the University of Pristina professor of public law Enver Hasani puts it.

Such a policy provides for solving the problems of each Balkan country separately from one another. This approach was at the heart of the Stability Pact for Southeast Europe, devised by the European Union and introduced in 1999.

The unilateral declaration of independence for Kosovo in 2008 embedded in this concept a provision about the “uniqueness of the Kosovo case.”

However, amid the current impasse around Kosovo Serbs and the growing activity of Albanian nationalists, the international curators of the Balkan settlement, above all the most business-minded and openly cynical of them in the form of the administration of the US President Donald Trump, could switch to a “territory-focused policy,” which views a region not as an combination of already established states, but as a system of territories in dynamic equilibrium and, therefore, capable of reformatting.

“For some Balkan politicians, talk about territorial division and redrawing of maps is like adrenaline,” the Croatian newspaper “Jutarnji list” rightly wrote.

“The question is, what will happen to the federation of Bosnia and Herzegovina? Will this catastrophic disintegration of Bosnia and Herzegovina affect Croatia, or will a peaceful Bosnia finally emerge taking in “parts of Croatia”!? Another question is, how would the Bosnians and their defenders, such as Turkey, react to this?! Perhaps, for Serbia, the matter would not be limited to Presevo, and the processes would affect both Sandzak and the very north of Serbia. On the other hand, the exchange of territories with Kosovo could raise the issue of ‘consolidating the Albanian nation,’ which would revive old ideas of dividing Macedonia. And with the process of Albanian consolidation on and with the Republika Srpska already  part of Serbia, this would whet Serbian appetite, if not for the whole of Montenegro, then at least for its ‘Serbian parts,’” the newspaper forecasts and makes a sad conclusion: “Despite the seeming simplicity (“we give you, you give us”), this decision leads to hell.” jutarnji.hr

In all fairness, any new changes in the situation in the Balkans – and above all, the delineation of borders – will raise the discussion to a higher international level and may potentially bring them back to the floor of the UN and the UN Security Council where Russia  wields a veto power.

Simultaneously, such scenarios are forcing Belgrade to work more closely together with Moscow, which is one of its key international allies.

The Serbian political class is aware that it cannot move forward without progress toward resolving the long-standing Kosovo issue. But in order to save face with its constituents, the Serbian leadership has to come up with some settlement in which Serbia will not be perceived as the total loser of the Kosovo dispute. To that end, Serbia must have a great power backer in the negotiating process, and as Serbia lacks a patron in the West, Russia is useful in that role. As long as Kosovo remains in play and as long as Serbian leadership lacks a settlement acceptable to public opinion, Russia will have a high place in Serbian foreign policy considerations. The West should be cognizant of this. For their part, both the European Union and the United States need to be aware that close ties between Russia and Serbia are in large part the result of taking Serbia and the Balkans for granted,” The American Interest emphasizes.

Given the situation at hand, Russia needs to figure out the possible options of such a reformatting of the Balkans and choose the ones, which are best suited to its geopolitical interests and those of its allies and partners in the Balkans region and beyond.

First published in our partner International Affairs

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