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Greeks say ‘NO’ to an open laboratory for violation of human rights

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The Greek debt crisis saga continues with no resolution in sight. As expected, the European leaders rejected a last-minute proposal by Alexis Tsipras, Prime Minister of Greece, requesting an extension of the bailout program that expired on 30th June and seeking a new €29.1 billion bailout package that could have covered country’s debt obligations over the next two years.

The rejection led the country to default on its €1.6 billion loan repayment to the International Monetary Fund. Greece is the first developed country to default to the IMF. Even though the IMF does not use the term default, it will now classify Greece as being “in arrears” and the country will only receive funds in future once the arrears are cleared.

After several rounds of protracted negotiations in Brussels, Greece had rejected the anti-austerity conditions contained in the bailout package prepared by the troika (European Commission, European Central Bank and the IMF). The troika demanded substantial cuts in pension and wages besides overhauling value-added tax as a precondition for releasing the remaining funds from the bailout package which expired on 30th June. Disappointed over the rigid stand taken by troika, on 27th June, Mr. Tsipras announced a referendum to decide whether or not Greece should accept the bailout conditions. The referendum will take place on 5th July.

By announcing a referendum, the Greek government has put the ball in people’s court. It is hard to predict the outcome of forthcoming referendum. It is likely that a No vote would strengthen the bargaining power of the current government which came to power on anti-austerity platform in January 2015. While a Yes vote would make the government’s position untenable and probably lead to general elections.

Capital Controls

On 28th June, the Greek government imposed capital controls and other regulatory measures to maintain liquidity and stability in the banking system. These include:

  • All banks in the country will remain closed for a week (June 29- July 6, 2015).
  • An individual can withdraw up to €60 per card a day from ATM.
  • The foreign bank cards are exempted from this daily limit.
  • The transfer of money to outside Greece will require approval from the official authorities.
  • A specialized agency will deal with urgent payments that cannot be met through cash withdrawals or electronic transactions.

The Accumulation of Public Debt

No discussion on Greek debt crisis would be complete without analyzing how the country’s public debt got accumulated over the years. In 2004, the country’s public debt was €183.2 billion. By 2009, it reached as high as €299.5 billion, or 127 percent of country’s GDP.

Currently, Greece’s public debt stands at €323 billion, nearly 175 percent of country’s gross domestic product. Both the critics and supporters of Greek’s government admit that such a high debt-GDP ratio is unsustainable. The current government is seeking substantial write-off of country’s debt so as to put the country back on a growth trajectory. While seeking debt relief for Greece, several economists and legal experts have referred to London Agreement in 1953 which gave generous debt relief to West Germany by writing off its 50 percent of debt, accumulated after world wars. This debt relief was one of the key factors which enabled the reemergence of Germany as a world economic power in the post-war period.

In 2015, the Greek Parliament set up a Truth Committee about the Public Debt to investigate how country’s foreign debt got accumulated from 1980 to 2014. The Committee has recently released a preliminary report which states that Greek public debt is largely illegitimate and odious. I would earnestly request readers to read this report as it confronts several popular myths associated with the Greek public debt. According to the report, the increase in debt before 2010 was not due to excessive public spending but rather due to the payment of extremely high rates of interest to creditors and loss of tax revenues due to illicit capital outflows. Excessive military spending also took place before 2010.

More importantly, the report reveals how the first loan agreement of 2010 was used to rescue the Greek and other European (especially German and French) private banks. The loan agreements of 2010 (and 2012) helped private banks and creditors to offload their risky bonds issued by the Greek government. In simple words, the debt of the private banks was transformed into public sector debt via bail-outs. As pointed out by Tim Jones of Jubilee Debt Campaign, it is not the people of Greece who have benefitted from bailout loans from the troika but the European and Greek banks which recklessly lent money to the Greek government in the first place.

Out of €254 billion lent to the Greek government by troika since 2010, only 11 percent have been spent to meet government’s current expenditure. Of course, previous governments of Greece are equally responsible for spending beyond its means and falsifying its public accounts.

Who owns Greece’s public debt? Currently, close to 80 percent of Greece’s public debt is owned by public institutions — primarily from the EU (member-states, ECB and EFSF) and the IMF (see chart below) The rest is owned by private creditors.

Austerity Caused a Humanitarian Crisis

The social and economic consequences of austerity measures imposed by troika on Greece have been devastating. Since 2010, Greece’s GDP has fallen by 25 percent and unemployment rate is 26 percent. The youth unemployment rates are at an alarmingly high level. Currently, over 56 percent of young people in Greece are without a job and there are more than 450,000 families with no working members. After five years of fiscal adjustment and economic hardship under the austerity program, Greece’s major indicators (including GDP, employment and incomes levels) are still far below the pre-crisis levels.

The welfare spending cuts proved to be counter-productive. As pointed out by Ozlem Onaran of University of Greenwich: “The wage and pension cuts and fiscal consolidation led to lower GDP, tax losses, and higher public debt. Our estimates show that the fall in the wage share alone has led to a loss in GDP by 4.5%, and a 7.80% point increase in the public debt/GDP ratio. The fall in wages alone explains more than a quarter (27%) of the rise in the public debt/GDP ratio in this period. The conditionalities of the memoranda have not only been counterproductive in terms of its aims regarding debt sustainability, but also engineered a humanitarian crisis.”

Many legal experts argue that the harsh austerity program imposed by troika could potentially pose a violation of human rights. According to Ilias Bantekas, Professor of International Law at Brunel University Law School, “The measures imposed against the Greek people were wholly antithetical to fundamental human rights as these stem from customary international law, multilateral treaties and the Greek constitution. Consequently, these ‘loans’ were held to be odious, illegal or illegitimate.”

It is pertinent to note that not just in Greece, the austerity programs also failed to yield positive results in Cyprus, Spain and Ireland.

Grexit: Pain and Gain

What would happen if Greece abandons or is forced to exit the euro? In the short-term, it would certainly entail greater uncertainty and economic hardship. A massive capital flight by the elites along with collapse of banks and businesses which have borrowed in euros cannot be ruled out. The payments of salaries and pensions could also be delayed for months.

The social and economic consequences could be disastrous for Greek economy and its people if the transition from the euro to a new national currency (possibly drachma – its old currency) is badly managed. Hence, the transition should be well-planned and properly implemented with popular support.

There is a growing consensus that a massive devaluation of drachma would help in increasing domestic demand and improving the prospects of economic recovery. A weak drachma would make Greek exports more competitive and its tourism more attractive and therefore would open up new opportunities to enhance exports and encourage more tourism over the long-term. Exports account for nearly 30 percent of its GDP. Because of a weak new drachma, the demand for domestic goods would increase as imports will become more expensive thereby boosting the domestic demand which, in turn, would also encourage greater domestic production and create more jobs for Greek people.

In addition, Greece will also regain its independent monetary policy and fiscal space to set policies in tune with its own economic needs instead of those of Eurozone economies. Needless to say, a small country like Greece (representing less than 2 percent of EU’s GDP) should never have joined the flawed monetary union in the first place.

Wider Ramifications for Europe

Greece leaving the euro will have serious economic ramifications for the rest of Europe. If Greece leaves the Eurozone, the threat of financial contagion to other weak Eurozone economies (such as Portugal, Ireland, Spain and Italy) looms large and subsequently these economies may as well exit the euro. Not only such a move would weaken the Eurozone but, more importantly, it would spell the end of the single currency experiment and the larger European project towards greater economic integration.

Besides, one cannot ignore the fact that the euro may face massive devaluation if international investors liquidates their European assets and investments en masse.

Furthermore, there are human and geo-political ramifications which are not sufficiently understood by European leaders. How will the EU cope with the influx of migrants from North Africa who enter Europe (via Mediterranean route) without the active cooperation of Greek government?

Technically speaking, an exit from euro does not mean an exit from the EU. A Greek veto on extending sanctions against Russia over Ukraine would further weaken the European strategy to isolate Russia.

The observation made by many commentators that Grexit would isolate the country from the world economy is highly misplaced. Greece can explore new economic partnerships and build strategic alliances with Russia, China and other developing world. Given its favourable geo-economic location in Southern Europe, Greece can emerge as an important regional energy distribution hub. Greece has already launched discussions with Russia to build a gas pipeline to Greece via Turkey and then to Europe. This pipeline could bring immense benefits to Greece’s economy in terms of new investments and jobs. Greece is currently considering joining the New Development Bank (NDB) which was set up in 2014 by BRICS. Becoming a member of Asian Infrastructure Investment Bank is another possibility.

Needless to say, the European leaders need to act more like statesmen as the European Union is founded on the values of respect for democracy, equality, human rights and solidarity.

The Broader Meanings of ‘No’ Vote

Finally, the Greek citizens have delivered a resounding ‘No’ to bailout conditions demanded by creditors in a referendum held on 5th July. The referendum was announced by Greece’s Prime Minister, Alexis Tsipras, on 27th June after bailout talks with the creditors failed. The referendum asked voters to decide “whether to accept the outline of the agreement submitted by the European Union, the European Central Bank and the International Monetary Fund at the Eurogroup of 25/06/15.”

The government-backed ‘No’ side won with 61.31 percent of votes, while ‘Yes’ got the remaining 38.69 percent. Further, not a single electoral district of Greece voted for ‘Yes’. No one in Greece had predicted such a massive victory for ‘No’ vote. Most opinion polls had predicted a tight contest with ‘No’ side winning by a slim margin.

Does a ‘No’ victory mean Greece leaving the euro and the EU? Not exactly. As pointed out by PM Tsipras, “This is not a mandate of rupture with Europe, but a mandate that bolsters our negotiating strength to achieve a viable deal.”

Undoubtedly, the landslide victory in the referendum has greatly strengthened the bargaining power of the current government with creditors. The impacts of the austerity measures imposed by the international creditors have been catastrophic. The Syriza-led government, which came into power on an anti-austerity platform in January 2015, has resisted pressure to implement harsh austerity programs that affect the elderly and the poor.

Another positive outcome of the referendum is that the opposition parties have also given support to the Syriza-led government to negotiate a new deal with creditors. In many important ways, the decisive referendum has brought political stability in Greece which has witnessed four elections in five years.

A New Deal for Greece

In the current circumstances, a new deal is challenging but still feasible. Both sides need to realize the sense of urgency to pursue a realistic agenda. The negotiations between Athens and Brussels should resume immediately in order to avoid a major financial meltdown.

On their part, the leaders of Eurozone should accept a compromised deal to end the impasse. They should not insist that any special privileges to Greece would encourage other potential rule-breaking eurozone countries. The costs of a Grexit are high not only for Greece but also the entire Europe in terms of wider economic and geo-political implications.

It is important to note that the IMF in its preliminary draft debt sustainability analysis (dated June 26, 2015) has sought substantial debt reduction along with extended concessional financing for Greece. This IMF analysis specifically points out that Greece needs “a significant haircut of debt, for instance, full write-off of the stock outstanding in the GLF facility (€53.1 billion) or any other similar operation.” The Greek Loan Facility (GLF) consists of bilateral loans pooled by the European Commission.

A new deal is feasible if the European leaders realize the true importance of ‘No’ vote. The message of Greek referendum is loud and clear: harsh austerity measures imposed by the EU lack democratic legitimacy. And the debt relief should not be treated as a taboo.

Hence, keeping the wider interests of the European project in mind, its political leadership should adopt a more flexible approach towards Greece based on the principles of democracy, human rights, cooperation and solidarity. After all, the financial rules are meant to serve the people, not the other way around.

In return, Greece should also undertake policy measures to check massive tax evasion by oligarchs and streamline its public finances. Needless to say, the Greek government should be given a fair chance to put its house in order. This entails patience on the part of official creditors.

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Tackling migration crises: Fighting corruption may help

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Increasing numbers of migrants are moving towards the Belarus/Poland border.photo: Belarus Red Cross

Twenty-three-year-old Mohamed Rasheed was at a loss after returning to Iraq from a grueling failed attempt to cross the Belarus-Polish border. “There’s no life for us here. There are no jobs; there is no future,” he told a Washington Post reporter.

Another man, who had just disembarked from a repatriation flight from the Belarus capital of Minsk to Erbil in Iraqi Kurdistan, frowned and obscured his face with a scarf, according to the reporter, as he responded to a question about why he had left.

“Those words cannot leave my mouth. Who dares to tell the truth here?” the man said.

The two men were returning to a country whose population has largely been excluded from sharing in the benefits of its oil wealth. Youth unemployment hovers at about 25 per cent. Public good and services are poor at best. Security forces and militias crackdown on and fire live ammunition at protesters demanding wholesale change.

Mohammed and his fellow returnee could have been from Lebanon, a middle-income country in which three-quarters of the population lives under the poverty line thanks to a corrupt elite unwilling to surrender vested interests irrespective of the cost to others.

In fact, they could have been from any number of countries in the Middle East, North Africa, and their African and Asian peripheries.

Almost half of the youth from non-Gulf countries in the Middle East and North Africa want nothing more than to leave in the absence of opportunities and prospects. They are exasperated with corrupt, self-serving elites.

This is a part of the world where devastating wars have wracked Syria, Yemen, and Libya. More recently, these countries were joined by Ethiopia while others in the Horn of Africa and the Sahel reel from jihadist violence that feeds on social and economic grievances.

To primarily hold responsible for the migrant crisis, human traffickers and cynical authoritarian leaders like Belarus President Alexander Lukashenko, who are willing to play power games and turn a profit on the back of innocent men, women, and children is swatting at symptoms of a problem that goes to the root of instability in the Middle East and North Africa.

To be sure, Mr. Lukashenko and the traffickers are part of the problem. Moreover, many Middle Easterners on the Belarus-Polish border appear to be economic, not political refugees with a legal right to asylum.

One could argue that the European Union’s refusal to take in the refugees on humanitarian grounds led to their repatriation to Iraq and Iraqi Kurdistan, which may have shortened their ordeal. Many risked being ultimately rejected, even if they had been granted entry to the EU because they were not political refugees.

The jury is out on whether the refusal will serve as a warning to the many in the Middle East and North Africa contemplating ways to get to Europe by hook or by crook.

All of this describes the immediate aspects of a dramatic crisis. The danger is that the focus on the immediate will obstruct badly needed thinking of ways to prevent or reduce the risk of future such crises and human suffering, aggravated by the willingness of governments to fight their battles on the backs of the least protected.

The framing of the crisis as a security rather than a political, economic, and social problem further takes away from the development of policies and tools to tackle the root causes of repeated migrant crises – economic mismanagement; political, economic, and financial corruption; nepotism; and loss of confidence in political systems and leadership.

“Addressing population challenges, the youth bulge, and refugee and migration pressure from natural or man-made crises will require measures to promote sustainable economic growth and enhanced educational and healthy capacities,” said George M. Feierstein, senior vice president of the Washington-based Middle East Institute and a former State Department official with multiple postings in the Middle East and North Africa.

Acknowledging that a broader US policy focus is likely to prove more challenging than one narrowly concentrated on security, Mr. Feierstein argued that the United States could “bring assets to the table that could potentially enhance its role in the region and strengthen its position as the preeminent outside power.” The former diplomat was referring to big power rivalry with China and Russia in the Middle East and North Africa.

Adopting Mr. Feierstein’s policy prescription would involve greater emphasis on regional approaches to global challenges, including climate change and public health; conflict management and resolution efforts to safeguard populations and minimize internal displacement and migration; and institutional capacity and resilience building; all backed by greater US private sector engagement.

Kyrgyzstan has potentially emerged in what could provide evidence that a de-emphasis of the security aspects of the migration crisis would not automatically surrender real estate and /or leverage and influence to China and Russia.

Part of a Central Asian world sandwiched between Russia and China on which the United States has seemingly turned its back with its withdrawal from Afghanistan in August, Kyrgyz President Sadyr Japarov is using his election pledges to fight corruption and offer financial rewards to whistleblowers to lure the US back.

Mr. Japarov’s proposition, designed to rescue Kyrgyzstan from the clutches of Russia and China, is the central theme of a document that he has sent to the US State Department. The document outlines proposals to revive a broad political, economic, and civic engagement with the US bolstered by anti-corruption measures and affirmation of democratic freedoms.

S. Frederick Starr, founding chairman of the Central Asia-Caucasus Institute, suggested that Mr. Japarov is providing a template for US reengagement with Central Asia and Afghanistan. In fact, the Kyrgyz president is offering a formula equally relevant to the Middle East and North Africa.

If adopted by the Biden administration, Kyrgyzstan “would become ‘The Mouse that Roared’ to cite the title of the droll 1959 British film.  This time, however, the lesser power will have advanced its cause not by threatening military action…but with a sensible proposal by which a great power—the United States—…can once more become a serious presence in a major part of Asia that lies on China’s and Russia’s doorstep,” Mr. Starr said.

In contrast to Central Asia, the United States remains the dominant power in the Middle East and North Africa. But it’s a power seeking to redefine the role it wishes to play going forward in a region struggling to come to grips with an uncertain but changing US approach.

Kyrgyzstan could be showing the way for both United States and the Middle East. However, to make it work and reduce, if not stop, migration flows, the United States and its Western partners would have to prioritise confronting corrupt elites who will stop at nothing, including displacing populations, to preserve their illicitly gained privileges.

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An election, another one, and yet another one: Will Bulgaria finally have a functioning government?

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As of November, Bulgarian voters headed to the polls four times this year. Therefore, the news of a new election evokes little surprise — almost like in Israel before Netanyahu’s ousting. In both countries, the tension kept rising while expectations became more and more modest with each successive electoral round. However, the contests that took place on Sunday 14th were of the utmost importance for the country; and not only. In fact, Bulgaria is the EU’s and NATO’s south-eastern bulwark and hosts a tract of the South Stream gas duct. Moreover, Sofia is currently blockingthe next round of EU enlargement negotiations over North Macedonia’s disrespect of extant bilateral obligations. Finally, the Biden administration has manifested the US’s renewed interest in the Bulgaria’s internal politics and international orientations. Thus, the result of the vote has wider implication for the European and Euro-Atlantic political and geo-strategic stability.

Background — Two failed elections

April 2021: How the parties ‘hung’ the parliament

Last April, Bulgarians voted to renew the sitting parliament in the general elections. However, after a summer-long wave of protests against the Prime Minister and the Attorney General, established parties looked rather weak.

According to most experts, this new season of contestation has mobilised new voters, previously disenchanted about politics. As a result, the parties and the leaders who casted themselvesas supportive of the protests increased their votes. In particular, the neo-liberal coalition Democratic Bulgaria (DB) got the support of the well-educated and those residing in bigger cities. Meanwhile, the personal parties Stand Up! Bastards Out! (ISMV) and There is Such a People (ITN) fished across the board.

But they cannot persuadePM Boyko Borisov’s supporters that his removal from office is a precondition for societal improvement. Thus, despite the many corruption scandals involving Borisov’s cliques, all polls forecasted his party, GERB, would have won the election.

Or, to be more precise, GERB won the ballot count — but without a majority (see Figure 1). Moreover, the indignation did not spare the Bulgarian Socialist Party (BSP), which sometimes vents sympathies  for GERB despite its corruption. In addition, the elderlies are overrepresented amongst the BSP’s voters, the party suffered from Covid’s increasing morbidity during the spring. Hence, the main traditional opposition party lost votes in favour of the abovementioned ‘protest parties’, weakening the wider anti-Borisov front.

Against this background, there was absolutely no chance of seeing a cabinet get through a vote of confidence. In fact, GERB won 75 seats and the DPS, an ethnic-Turkish party closely associated with GERB, got other 30. Meanwhile, the so-called “parties of the protest” had only 93 representatives on the 121 needed to form a government. True, the BSP managed to hold on to 43 seats — enough to make the protest parties’ eventual confidence motion pass. But DB and ITN refused to engage in serious negotiations with the socialists, forcing the parliament to disband.

The President scheduled new election in July.

July 2021: How politicians (did not) made it through another hung parliament

Most Bulgarian parties and their leaders failed to understand the real meaning of the election results in July. In fact, for the first timesince its appearance in 2009, GERB failed to win the most votes. In part, this could be explained arguing that a large share of GERB’s constituency does not vote ideologically. On the contrary, researchers hypothesise that support for Borisov’s party stems chiefly from the networks of clienteleshe has established. Thus, it was relatively uncomplicated for the President-appointed caretaker government to disincentivise practices such as vote buying and controlled voting. Either way, subsequent sociological analyses and available data show that GERB’s voters demobilised more than other parties’ supporters in July.

Conversely, the so-called ‘parties of the protest’ were the main beneficiary of the disengagement of GERB’s voters. True, most of the ITN’s, DB’s and ISMV’s voters were not ideologically committed to their party of choice either. Nevertheless, the results showed that protest voting can be powerful enough of a force to uproot an already-destabilised party system. In fact, all three parties increased their share of the vote and number of seats (see Figure 2). In addition, ITN’s votes increased in absolute terms by 92,000 units despite an eight-percent reduction in turnout.

After having seen the results, Borisov’s adversaries, especially President Radev, imagined the parties could agree on a new cabinet. In fact, GERB and the DPS lost 13 seats. Meanwhile, the so-called “parties of the protest” had as many as 112 representatives and the BSP was left with 36. Eventually, strong of its 65 deputies, ITN came up with the offer for DB, ISMV and the BPS. Essentially, ITN would form a minority “cabinet of experts” following an agenda agreed amongst the four parties. In other words, ITN came up with a confidence-and-supply arrangement which would have denied its partners any post. However, the populist reason which drives ITN’s strategy led to a massive failure although there was a draft government programme. Namely, according to several rumours, DB requested to rediscuss some of the cabinet members’ nomination as part of the agreement. Predictably, ITN’s preconceived denial to negotiate on the names caused DB’s rebuttalof the entire confidence-and-supply mechanism. Obviously, the BSP and ISMV opportunistically abandoned ITN’s wretched locomotive before the egregious failure of its government in pectore.

The President scheduled new election in November.

Yet another parliamentary… and finally a cabinet?

Considering the previous two votes’ result, it is unsurprising that few analysts tried to call the last electoral round. Indeed, much of this unpredictability stemmed from the decision of two President-appointed caretaker ministers to form a new party. Actually, the names of former finance minister Kirill Petkov and former economy minister Asen Vasilev were little known until May. However, the former’s intense public activity in the revealing the corrupt practicesof Borisov’s administration made him very popular. Moreover, Petkov’s rhetoric emphasises, unlike that of most other Bulgarian political leaders, dialogue, trust and teamwork— especially with Vasilev. Lastly, Petkov and Vasilev made a wit choice in calling their party We Continue the Change (PP). In fact, the name underlines continuity with the caretaker government’s activity and suggests a connection with its appointer, President Radev. After all, the President remains the most popular Bulgarian politician and PP benefitted from his informal blessing (Figure 3).

Overall, the results are surprisingto say the least (Figure 4). Although the turnout fell again to slightly less than 40% of eligible voters, PP achieved a convincing lead over GERB. At the same time, the entire political panorama changed dramatically virtually overnight. After a months-long decline, ISMV failed to clear the four-percent threshold to enter the parliament and risks disappearing. Evidently, the BSP continued its decline, ranking fourth – even after the DPS – and losing 54 seats on its pre-2021 level. Interestingly, PP seems to have syphoned offso many votes from the protest party par excellence, ITN, to shrink it to 25 seats.  The same dynamic drove votes from PP to DB, whose leader admitted the two parties’ self-evident ideological affinity recently. Finally, a nationalist ‘protest’ formationmanged to elect 13 deputies, remedying nationalists’ failures in April and July: Văzrazhdane (‘National Revival’).

Looking at the mere numbers of seats in the parliament, one would reach a simple conclusion. And some already say that the Bulgarians will soon have to deal with a new cabinet, with Petkov as PM. However, the most refined analysts have noted that the parties may fail to form a government for the third time.

Conclusion — What to look for in the next weeks and months

The most fascinating aspects of Bulgaria’s current election cycle is not new to those who follow Israeli politics, for instance. In fact, as it happened in Tel Aviv after Netanyahu’s failure to form a government, many feel changes coming. However, in Sofia like in Tel Aviv, there are still many unknown quantities to deal with in politics’ general equation.

Obviously, the reference is most directly to Văzrazhdane — this absolute newcomer to parliamentary politics. First, the party has adopted rather ‘atypical’ stances on, amongst other topics, Bulgaria’s NATO and EU membership. Curiously, most of the party’s propaganda material is freely and easily accessible online through social networksand Văzrazhdane’s website. Besides the fact that the majority of its activists and candidates are open to have an online chat with anyone. Hence, it is reasonable to expect that at least part of Văzrazhdane’s 127,568 voters is well aware of its ideals. Nevertheless, it may not be able to coalesce with a strongly pro-EU, neo-liberal and verticalized party as PP without denaturing.  Second, the party’s modest success may be more sustainable in the medium to long term than that of PP. Differently from PP, ITN, ISMV and otherBulgarian leader-driven political projects, Văzrazhdane has been growing up for year. In effect, a few sociologists and analysts were already singling out the party’s positive trajectory in July. Thus, its ideas may turn into a long-lasting destabilising factor for Bulgaria’s usually dull foreign policy in the coming years.

Furthermore, one can argue at length on what these results say on the state of Bulgaria’s liberal democracy. Sure, neither PP nor GERB are a serious threat to democracy as a procedural rule involving elections. However, both parties pose an unmistakable menace to the country’s already fledging liberal institutions. In fact, both Borisov and, in his short tenure to nowadays, Petkovhave shown little appreciation of parliamentarism. Moreover, Petkov embraces a brand of neoliberalismwhich implies a few carrots(e.g., raising pensions) and much more stick. In fact, he has only criticised entrepreneurs whom others have already associated with Borisov and promised not to raise taxes. In addition, he has an open feud with the Constitutional Courtover his dual citizenship — which invalidated his ministerial appointment. Finally, Petkov and his associated have approached the pandemicas a common-sense matterdespite the ongoing compression of citizens’ freedoms.

Therefore, the future remains unpredictable. Especially assuming that a Petkov cabinet would have the support of both the EU and the President. In fact, left unconstrained by Brussels in the name of stabilitocracy and supported by Radev to finish off his archenemy, Borisov, Petkov and his associated may end up rewriting the rules of Bulgarian politics in an elitist way. After all, they have already done it by violating all constitutional customs on caretaker governments’ self-restraint. Why not to try again?

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Engaging Morocco: A Chess Game Spain Does Not Want to Lose

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In a game of chess, each player knows the type of game they are playing and takes turns moving the pieces. In addition to the relative advantage of making an opening consistent with your objectives, you must anticipate your opponent’s moves and plan accordingly.

Morocco moved pieces on May 17 and 18, 2021, when it let in 8,000 immigrants in the city of Ceuta, a Spanish territory in Africa and external border of the European Union. It did so without warning, neglecting its functions as border guardian and allowing the entry of a mass of migrants amounting to 9.5% of Ceuta’s population.

This episode is of unprecedented character: it occurred in the context of a geopolitical change in the Maghreb, within an unparalleled worsening of Rabat-Madrid relations, and it was of an unmatched magnitude. The particularity of the event demands an assessment of the relations between both countries and of Spain’s strategy towards Morocco. Does Madrid know that it is playing chess with Rabat? Is it capable of reading the moves of Morocco in advance? Does it have an effective strategy?

Background

This act takes place during a period of dramatic change in the Maghreb area. Namely, hostilities over Western Sahara broke out again in 2019. Further, Morocco’s relations with Algiers have drastically deteriorated, while its relations with Europe have become more strained following the CJEU rulings in 2021 and conflicts with France and Berlin. Washington has increased its support for Morocco, recognizing its sovereignty over Western Sahara and providing arms supplies and military cooperation. In parallel, Rabat is making a pivot to Africa, strengthening ties with the Sahel and extending its diplomatic contacts with Nigeria, Senegal and other West African countries. These changes enhance the importance of Morocco’s movements and highlight the relevance of its interactions with its only European neighbor: Spain.

Relations between Spain and Morocco have always been conflictive and prosperous in equal parts. In addition to the positive aspects of trade relations, economic complementarity and cooperation in the fight against terrorism, there are also problematic aspects: territorial claims over Spanish possessions in Africa, maritime delimitation issues and immigration. Morocco’s rejection of the principle of Uti possidetis juris, seeking to change the borders inherited from colonialism, has brought conflict to its relations with its neighbors. With Spain, this is evident in events such as the Ifni War (Morocco-Spain), the Green March, the Perejil crisis and the events in Ceuta in May of this year.

In the media, relations between the kingdoms of Spain and Morocco are shaped by conflicts, such as the Perejil Crisis in 2002 and 2010-2011 without a Moroccan ambassador to Madrid. These confrontations, usually involving Spanish territories in Africa or issues of great public sensitivity such as migration or the Western Sahara, are short-lived and normally quickly resolved. As a result, relations between Madrid and Rabat are cyclical in nature and form part of Spanish domestic politics. This conditions that the high points in their relations never last long and that Spain’s responses in discussing the Sahara, Ceuta and Melilla publicly are avoidant rather than assertive. Within this framework, the events in Ceuta 2021 can be understood as a new setback in the development of complex relations.

These conflicts contrast with Spain’s deeply intertwined economic interaction with Morocco. Sectors such as automobiles, textiles and agriculture form part of the same value chain. Morocco is Spain’s second largest non-EU partner while Spain has overtaken France as the main supplier to Morocco. This responds to the concept of the “cushion of interests” put forward by Spain in the 1990s. The core idea of this strategy is that increased economic interdependence will reduce political tensions. According to this theory, since Morocco’s economy is more dependent on Spain than Spain is on Morocco, Rabat would be constrained in its political movements. However, given the frequency of conflicts between the two kingdoms, this liberal approach is of doubtful effectiveness.

The combination of frequent misunderstandings and growing economic interaction is not the only paradox to be noted in the relations of the two kingdoms. On the political level, the synchronization between the countries’ royal houses (mainly between Juan Carlos I and Hassan II in the past but also between Mohamed VI and Felipe VI at present) stands in contrast to the six years without the annual high-level meetings required by the Treaty of Friendship between the two countries. Moreover, Prime Minister Sanchez has broken with the Spanish tradition of paying the first foreign trip to Morocco, in place since the 1980s.

In short, the problems between Madrid and Rabat are cyclical and greatly affect Spanish domestic politics. Neither the strength of the commercial interaction nor the closeness between their kings are enough to smooth relations between the two countries.

The axes of the relationship between Spain and Morocco

The complexity of the relationship between Spain and Morocco revolves around six axes: migration, terrorism, energy, Sahara, Ceuta and Melilla, and the European Union. Each axis generates a series of opportunities and vulnerabilities for Spain, and it is the confluence of these axes that determines the ups and downs between the two countries.

The first of these axes is migration. Due to its sustained omnipresence in the media, it is the one that most concerns Spanish domestic policy. Sub-Saharan and Moroccan immigrants arrive to Spain through two different routes: by sea (to the peninsula and the Canary Islands) and by land (through the Spanish cities in Africa of Ceuta and Melilla). Since 1992, Madrid has increased cooperation with Rabat in this area.

Currently, the border externalization system is present in the repatriation of immigrants, the joint maritime police patrols, the joint police stations, the raids against massive assaults on border fences, and the construction and control of the Nador fence in Morocco. These projects are financed by European funds, which Morocco would like to see increase. This collaboration is asymmetrical: Morocco has sole control of the border, and Spain depends on its goodwill. Rabat, aware of this, does not hesitate to instrumentalize the issue.

The second axis is anti-terrorism and security cooperation. Collaboration in this area originated with the terrorist attacks in Madrid on March 11, 2004. Cooperation now extends to police, judicial and intelligence cooperation. In addition, with the aim of controlling radicalization, Rabat appoints part of the imams in Spain. Here again, the asymmetry is in favor of Morocco. The Moroccan imams could position themselves in favor of the interests of their country of origin. Moreover, anti-terrorist cooperation is essential for Spain’s national security, and its potential loss would put Spain at risk.

The third axis is energy. The Spanish presence in this field is extensive, with participation in Morocco’s solar and wind power development and in its combined cycle power plants. In addition, Spain exports electricity to Morocco through two interconnections with the Iberian Peninsula, which accounts for 20% of the Moroccan demand. Spain used to be dependent on the Maghreb-Europe gas pipeline, which passed through Morocco. Its closure in November 2021 has reduced this dependence but has posed a problem to guaranteeing gas supplies to Spain. In this field, Spain has the upper hand: it has vetoed the Mediterranean Solar Plan in Morocco (to avoid competition with Spanish renewable production) and has rejected a 3rd electricity interconnection requested by Morocco.

The fourth axis is that of Western Sahara. This former Spanish colony is of visceral importance to Morocco. In the heart of its territorial claims, the conflict remains ongoing since it began in the 1970s, and Rabat lacks international support on its position. Moreover, it is a topical issue, around which Morocco has recently won American support, French and German rejection, and on which it has declared that it will not sign trade agreements that do not include Western Sahara.

Spain faces a dilemma since it must choose between its public opinion (sensitive to the Saharawi cause) and its trade relations with Morocco. As a result, it maintains a dual position. Officially, Spain supports a solution through the UN, sends humanitarian aid to the Saharawi refugee camps in Tindouf, recognizes the Polisario Front as representative of the Saharawi people and rejects Moroccan claims to Canary Islands waters on the grounds that Rabat has no sovereignty over Western Sahara.

Nevertheless, it applauds the autonomy project proposed in 2007 by Morocco (which does not envisage independence), rejected the US initiative to extend MINURSO’s mandate to human rights monitoring in 2013, and defends Morocco’s interests (and its own) before the judgments of the CJEU on trade agreements involving Western Sahara. The complexity of this axis, which forces Spain to walk in two directions at the same time, is a threat to any constructive relationship with Morocco.

The fifth axis is Morocco’s claims over the autonomous cities of Ceuta and Melilla and the Spanish islands off the Moroccan coast. Rabat’s endeavor to re-establish its “authentic” borders does not end in the Sahara, further extending into these Spanish territories, over which it has a permanent claim.

These territories have four problems.

  1. Economically, they are dependent on Moroccan trade and on Spanish subsidies,
  2. demographically, the growth of the population of Moroccan origin causes changes in the social structure that can be a source of conflict,
  3. international protection is relative, since the Spanish territories are not explicitly protected by NATO, and although they are part of the EU and the Schengen Area, they are not within the Customs Union,
  4. the islands do not appear in the Spanish Constitution nor in the Spanish territorial organization.

Taking advantage of these weaknesses, Morocco has used different strategies to strengthen its claims: economic blockades, vetoes against further integration into the EU, a rhetoric of colonialism, and comparisons to Gibraltar, and even the Perejil crisis in 2002, in which a small group from the Moroccan navy occupied one of the Spanish islands. This axis has a latent presence in the relations between both countries: although Madrid avoids its public mention, Rabat’s claims may end up in direct confrontation Spanish national interests.

Finally, the sixth and last axis is the European Union. Spain´s relationship with Morocco is based on the European Neighborhood Policy and on the Union for the Mediterranean. Besides, this relationship currently revolves around the provision of funds to Morocco for the externalization of borders, the agriculture and fisheries trade agreements, and the rulings of the CJEU on these, which since 2015 have complicated Brussels’ relations with Rabat. Indeed, Morocco has changed its attitude towards the EU since 2008, reducing its concessions, increasing its demands and adopting a more pragmatic discourse. In the framework of Madrid-Rabat relations, the EU has acted as an appeaser, reducing bilateral conflicts. However, Spain is limited within the multilateral structure, since it cannot impose its preferences and its power is confined to blocking initiatives (as it did with agricultural liberalization for example). Moreover, the judgments of the CJEU have poisoned the bilateral relations between Spain and Morocco.

What nowadays is cooperation in migration, security and energy, due to conflicts around the Sahara or Ceuta and Melilla may one day become an undesirable dependency. Too many issues related to Spanish national security are subject to Rabat’s goodwill. That is why the disagreements between the two countries cause so much commotion in Spain, even if they do not always revolve around each of the 6 axes described above.

Ceuta 2021 — Another crisis or a point of no return?

This article begins with the events of May 18, 2021, when Morocco loosened its border controls and allowed more than 8,000 undocumented migrants, mostly young Moroccans, to enter the city of Ceuta. The figure is unprecedented, around 10 times higher than what used to be received until then. It is worth asking whether this event is a simple downturn in the cyclical relations between Morocco and Spain, or whether it implies something different.

When the Ceuta crisis in 2021 is put into context, an extraordinary deterioration of relations between Morocco and Spain is observed, enhanced by unilateral actions by Rabat. In 2018, Morocco closed the commercial border with Melilla. In 2019, it toughened the fight against smuggling in Ceuta, hindering the border crossing and prohibited its officials from entering Ceuta or Melilla. To this day, this has subjected both cities to an unprecedented economic asphyxiation. In 2020, Morocco vetoed the entry of Moroccan fish into Ceuta and revived the dispute over the delimitation of maritime borders in Canary waters. In 2021, it installed a fish farm in Spanish waters near the Chafarinas Islands without permission. In recent years relations between the two countries have worsened gradually, camouflaged behind the Covid-19 pandemic and around issues of relative relevance, which only indirectly affect the 6 axes above mentioned.

In contrast, the Ceuta crisis is relevant in almost every aspect.

  1. Morocco is instrumentalizing immigration, leaving aside its obligations as border guardian.
  2. The Western Sahara conflict lingers in the background: the crisis was a form of protest by Rabat against the hospitalization in Spain of the Polisario Front leader Brahim Ghali, organized in an opaque manner by Madrid.
  3. Despite Rabat’s attempts to keep the crisis within the bilateral framework, it escalated to the European Union, where Spain received the support of the European Commission, the European Parliament (which issued a condemnation for violation of children’s rights against Morocco), and even of France.
  4. The crisis was followed by the reactivation of territorial claims over Ceuta and Melilla: The Moroccan Prime Minister compared the situation to Western Sahara.

Faced with the numerous and unusual vectors of this crisis, Spain must identify what objective Morocco is pursuing, and what its next steps will be. Rabat is obviously trying to capitalize on the momentum provided by the U.S. recognition of its sovereignty over the Sahara and its vigorous relations with some of its African neighbors.

Moreover, the deterioration of relations has coincided with a deterioration of Spanish domestic politics, while Morocco is taking advantage of independence, government instability, COVID-19, etc. Is Morocco pursuing a strategy against Spain? That is what the Spanish intelligence presumes, without knowing very well what strategy it is. In fact, the CNI considers the Ceuta crisis not to be an immigration problem, but an invasion that can be repeated again. Rabat could have taken the conflict into a gray zone, in which case it would be establishing the environment, waiting for opportunities.

The current situation is not part of the cyclical pattern that characterizes its relations with Morocco. Ceuta and Melilla are suffocating, Spanish intelligence fears losing anti-terrorist collaboration with Morocco, Rabat is in a strong position, and Madrid is unable to recognize what Morocco’s next step will be, limiting itself to trying to put an increasingly entrenched relationship back on track. The impetus with which Rabat is pushing for the recognition of its sovereignty over the Sahara, and its extrapolation of this to Ceuta and Melilla, suggests that the disagreements with Spain are not over.

In all this, Spain’s strategy towards Morocco is ineffective. The liberalism of the cushion of interests has failed. It was based on elements that were of national interest for Spain (migration, terrorism, etc.) but not for Morocco. The only sphere where Madrid has an advantageous position is energy: Spain exports electricity to Morocco, continues to refuse to establish a third electricity interconnection, and is receiving Moroccan requests for Spain to re-export Algerian gas. Moreover, Spain has learned that Morocco fears losing its reputation with the European Union and is trying to prevent the EU from getting involved in its bilateral relations. Thanks to the EU intervention, Morocco made a misstep during the Ceuta crisis this year.

However, everything suggests that Madrid is confident that the ups and downs will continue to prevail in its relations with Rabat and it accepts Mohamed VI’s invitation to inaugurate an unprecedented stage in the relations between the two countries. It is foreseeable, therefore, that Spain will keep Morocco as one of the two pilot countries of its Focus Africa 2023 plan, giving it and Senegal unparalleled attention in the development of constructive relations, and will export this experience to other African countries. In a game of chess, each player knows the type of game he is playing and takes turns moving the pieces. Spain knows that it is playing, but it has not realized that the game has changed, and that the chessboard is different. It has skipped several turns and, for too long now, its pieces have been sitting immobile.

From our partner RIAC

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