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The European Union, Moral Hypocrisy, and Stroking Tension in the Balkans

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Over the past several years, analysts and commentators have noticed a rising tide of domestic support for the Croatian homegrown Nazi movement of the Second World War, the Ustashe, which actively exterminated Serbs, Jews, and Roma in the territory it controlled from 1941-45. Far from condemning this alarming development, the Croatian government, the European Union, and non-state actors within it have tacitly and actively supported the rising tide of sympathy towards the Ustashe.

This disconnect between the ostensible “European values” of human rights and tolerance that the European Union claims to represent, and its tacit support of trends towards extremist politics in Croatia will have a significant impact on the increasing trend of Euroscepticism in Serbia and other Balkan states. Furthermore, the Union’s unabashed condemnation of legitimate populist movements in Europe, including but not limited to the Brexit campaign, as “racist” and “xenophobic,” while quietly supporting genuinely extremist political elements will contribute to the increasingly popular perception of the EU as a morally bankrupt and hypocritical entity.

Surge in Ustasha Sympathy

The Republic of Croatia has, since its independence, often reverted to the imagery of its Second World War predecessor; the Independent State of Croatia (NDH). The NDH was a puppet state sponsored by Nazi Germany and Fascist Italy, and was administered by the Ustashe. During its brief four-year lifespan, the NDH made use of a form of clerical fascism built on the basis of discrimination and systematized liquidation of non-Croatian elements within its boundaries. It was responsible for the deaths of anywhere between 300,000 to 600,000 Serbs and tens of thousands of Jews and Roma.

While restricted by law, Ustashe symbolism is freely exhibited at sporting events, political rallies, and all manners of public gatherings. The penalties for these displays are often restricted to a small monetary fine. By comparison, German law (Strafgesetzbuch section 86a) stipulates that a fine and/or a sentence of up to three years imprisonment will be administered.

Ustasha support among football hooligans (including a recent event during Euro 2016 where Croatian fans openly brandished swastikas) has been popular for decades; a more alarming trend is the active and tacit support of the Ustashe movement and legacy coming from the Croatian government. Earlier this year, the government of Croatia was condemned for appointing Zlatko Hasanbegovic, a prominent and open admirer of the Ustashe regime to be the country’s minister of culture. Croatia’s president, Kolinda Grabar-Kitarovic, is an avid fan of the pro-Ustashe musician Marko Perkovic “Thompson” and, while describing the Ustashe regime as “criminal”, also stated in the past that the NDH “at least protect[ed] the interests of the Croatian people” during its short and incredibly violent reign.

Silence at Best, Encouragement at Worst

Despite ongoing reports by international NGO’s of state-sponsored discrimination against Croatian Serbs and routine desecrations of Serbian churches and cultural monuments at the hands of pro-Ustashe elements in the country, the European Union has remained almost completely silent on the issue of growing pro-Ustashe sympathies in the Croatian government and political scene.

Rather than condemn the rising tide of Ustashe sympathy in the country or denounce the appointment of Ustashe sympathizers to some of the Croatian government’s highest ministries, the European Union has chosen to tacitly support the creeping return of political extremism to Croatia. On June 15th, an exhibition dedicated to Cardinal Alojzije Stepinac was held at the European Parliament, one of the EU’s most important institutions of governance. Cardinal Stepinac, who served as the Croatian Catholic Archbishop of Zagreb from 1937 to 1960, was an active supporter of the Ustashe regime and according to prominent Balkan historian Bernd Jurgen Fischer “had close association with the Ustashe leaders as the archbishop of the capital city, had issued proclamations celebrating independent Croatia, and welcomed the Ustashe leaders.”

The European Union has yet to respond to any of the criticisms lodged against it for hosting an event dedicated to a key supporter of a Nazi-backed regime that murdered hundreds of thousands of innocent civilians during the Second World War.

A recent definition (photo) of the Ustashe regime in the leading German language dictionary ‘Duden’ as a “movement which fought against ‘Serbian centralism’” has also provoked a firestorm of controversy and a rapidly growing online petition sponsored by the humanitarian organization 28 Jun. (full disclosure: we are both members of this organization). The definition makes no reference to any of the Ustashe’s well-documented and numerous crimes against civilian populations, giving it the appearance of a legitimate political movement with reasonable aims. These recent events are contributing to the growing sentiment among many Serbs who feel alienated by the European Union, and as if a double standard is being applied with regards to Serbia.

Loss of Credibility

Since Serbia attained candidate status in 2011, the European Union has imposed on it a host of requirements and stipulations that ostensibly deal with human rights and unresolved issues stemming from the Yugoslav Conflicts of the 1990’s. The Serbian government has largely complied with the conditions imposed on it by the European Union and has committed itself to the EU through acts such as extraditing members of its own government and “normalizing” relations with the Republic of Kosovo (a self-declared state which unilaterally declared independence from Serbia in 2008) at the behest of the European Union. Additionally, many EU states voted in favour of a failed UN resolution that sought to classify the controversial events in Srebrenica in 1995 as “genocide”.

Given the fact that the European Union has both passively supported the rise tide of extremist political inclinations in one of its member states by refusing to condemn it and actively supported it by hosting exhibitions in its honor, Serbs’ enthusiasm for joining the EU will likely continue to wane. The European Union has demonstrated a lack of integrity and even-handedness in upholding its stated human rights values by enforcing relatively harsh standards for Serbia while imposing virtually none on Croatia, even going as far as openly supporting some of Croatia’s worst historical human rights abusers. Coupled with growing Eurosceptic sentiments in both Serbia and Europe as a whole, the European Union’s quiet support of radicalized politics in Croatia could jeopardize the EU’s strategic goals of acquiring Serbia as a member.

Furthermore, the double standard shown by the European Union in its dealings with Croatia and Serbia represent yet another example of the moral hypocrisy of the European Union. While top EU officials were quick to denounce legitimate populist movements such as the Brexit campaign as racist and xenophobic, those same officials and institutions have done nothing but tacitly support genuinely extremist politics in Croatia. Eurosceptic parties such as Front Nationale and the Austrian Freedom Party are routinely branded as “far right” and “radical” while political extremism in Croatia is allowed to flourish. If the European Union does not take steps to meaningfully combat this moral hypocrisy, then it is likely that the trend of increasing skepticism towards the Union will continue to rise unabated.

(*)Daniel Jankovic is a graduate of the University of Alberta’s History and Economics program. He studies history and economics, and has an avid interest in political discourse and international relations, especially in regard to the Balkans of Southeastern Europe. He recently completed an in-depth analysis on the death of the residential bar and its social impact in the Balkans. The paper is slated to be published in several academic journals in the upcoming year. He is an active member of 28. Jun, a Canada-based not-for-profit organization and is launching Konstantine, a digital magazine about current events in the Balkans in Winter 2016.

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The projection of Turkish power in the Eastern Mediterranean

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The recent military conflict between Greece and Turkey over potential gas fields located in disputed waters is linked to a complex historical and political conflict between the two nations, so geographically close, but also culturally and politically distant. The superpowers have problems and alliances linked to the two countries, thus globalizing the conflict. Furthermore, all the countries concerned need the cooperation of Greece and Turkey in various fields such as the refugee crisis.

It is symptomatic of the changing nature of geopolitics, geoeconomics and the aftermath of Covid-19. The frictions reflect Turkey’s strategic rebalancing. The conflict in the eastern Mediterranean is mainly the result of a dispute between Turkey and Greece. Two aspects in particular of this balance of power form an explosive mixture in the Eastern Mediterranean, firstly the conflict stems from the fact that there are no agreed maritime borders between Turkey and Greece. The two countries contest their mutual claims on maritime territories and thus contest their respective rights to search for underwater energy resources in the eastern Mediterranean and the Aegean Sea.

Secondly, Turkish policy in the Middle East has helped lure other powers into maritime conflict.

The rift between Turkey and its eastern Mediterranean neighbors mainly affects Cyprus. While the Republic of Cyprus is internationally recognized as a sovereign state, the Turkish Republic of Northern Cyprus has only been recognized by Ankara since its establishment in 1974. And above all, it sees the southern part of the island as secessionist. Turkey has longstanding objections to exploration licenses Cyprus offers to international energy companies, including ENI and Total. These licenses are mainly concentrated in the south and southwest of the island. These zones are included in the exclusive economic zone claimed by Cyprus but which, according to Ankara, violates its continental shelf as well as the territorial waters belonging to.

International law currently offers few possibilities for resolving maritime complaints. The 1982 United Nations Convention on the Law of the Sea states that coastal nations are entitled to a 200 mile exclusive economic zone where they can claim the rights to fishing, mining and drilling. But shorter distances in the eastern Mediterranean force states to settle on a negotiated dividing line. Turkey’s position adds further complexity to these issues: Turkey is in fact not a signatory to the UN convention and defends a different interpretation of maritime rights, arguing that the waters adjacent to the Greek Cypriot administration remain an integral part of the continental shelf of Turkey.

The agreement of 27 November 2019 signed between Turkish President Recep Tayyip Erdogan and Libyan Prime Minister Fayez al-Sarraj defined a maritime border between the two signatories. The agreement was the most important signal of Turkey’s ambitions. The text delineates a 35-kilometer line that will form a maritime border from the southwestern coast of Turkey to the north of Libya, and crosses the areas claimed by Greece and Cyprus. It tilts the balance of power in the eastern Mediterranean in favor of Turkey. This disrupts the planned route of the 1,900-kilometer Eastern Mediterranean gas pipeline that would carry gas from Israel through Cyprus and Greece to southern Europe. Greece called on the United Nations Security Council and NATO to condemn Turkey’s maritime agreement and for this expelled the Libyan ambassador to Greece. Apparently, as a countermeasure to Turkey’s tactics, Israel, Cyprus and Greece have teamed up to carry out the Eastern Mediterranean pipeline.

It must be said that Ankara has the ambition to be an energy hub for Europe. The Turkish state wishes both to guarantee the Turkish Cypriots a share of future gas revenues and to free Turkey from its dependence on Russian gas supplies. Erdogan had sent his own drilling vessels into disputed waters north-east and west of Cyprus, as well as south of Kastellórizo.

Turkey fears it will be cut off from most of the Aegean Sea and therefore from major sea routes if Greece unilaterally expands its territorial waters and creates new areas of maritime jurisdiction. Erdogan responded by adopting a more assertive line with more aggressive rhetoric. The Turkish government says that as long as talks on maritime disputes are pending and Greece and the Republic of Cyprus continue to do research or drilling, Ankara will too. For their part i Greek officials say Turkey’s new policy is what has reignited the dispute and strained Ankara’s relations with its neighbors. Greeks are increasingly concerned about the safety of hundreds of islands that are very close to Turkey.

Whether it is Turkey or Greece, the two countries are using the migration issue to exert pressure. The situation on the Greek-Turkish borders in fact remains tense and very unstable; the current status quo in the region has all the hallmarks of a hybrid battle. Turkish officials and security forces push migrants to the neighboring country, often even helping them with illegitimate means. Meanwhile, the press and social media are fully used to shape public opinion in favor of interested parties. Propaganda in this context plays a vital role in this conflict. In addition, Ankara also uses its strategic position with the Bosphorus Strait and threatens to close the US Incirlik base to serve its interests.

Turkey has pursued an aggressive and expansive policy in its region for the past decade. This Turkish government approach is steeped in neo-Ottomanism and pan-Islamism. We find in this approach the ramifications of a much older school of Ottoman imperialist thought. The wave of bellicose maneuvers by the Turkish government can be attributed to the 2016 coup attempt, which gave the Erdogan government carte blanche to implement its long-sought power projection policy.

The government’s strategy to create a sense of successful foreign policy in the country, and thereby destroy most of the opposition parties, involves a discourse that emphasizes national interest. This vague but extremely useful term has had a paralyzing effect on the various opposition factions in the country, as they are unable to formulate a counter-narrative without risking being accused of lack of patrioticism. Very often the analysis of modern Turkey’s foreign policy as neo-Ottoman politics ends with the assertion that Erdogan and his party are nostalgic for the restoration of Ankara’s influence in the ancient regions of the Ottoman Empire.

If we take the example of Libya, one of Turkey’s goals in Libya is to completely control the country’s market and establish economic dependence on Turkey. It should be added that Turkey has signed two memoranda with LNG, one on military support and the other on demarcation at sea. Under the maritime border demarcation agreement, LNG has supported Turkey’s demands on part of the waters of Greece and Cyprus. Furthermore, Ankara intends to exploit any gas reserves on the Libyan coast. Indeed, in exchange for military support, Ankara imposed a treaty on Tripoli to take control of a significant portion of the country’s oil and gas wealth and forced LNG chief Fayez Sarraj to support its territorial claims in neighboring countries. This is a classic example of Turkish imperialist politics.

As a result, Recep Tayyip Erdoğan’s Turkey has engaged in the past two years in a remarkable series of geopolitical foreign interventions from Syria to Libya via Cyprus and more recently alongside Azerbaijan. Some have called it Erdogan’s “New Ottoman Empire” strategy. Yet a collapsing lira and a collapsing national economy threaten to unexpectedly put an end to its great geopolitical ambitions. To date, in 2020, the lira has fallen 34% against the US dollar and 70% over the past five years. While some believe it would increase Turkey’s exports of goods, what it does is expose the entire Turkish banking system and economy to a colossal debt explosion. It can also be noted that at this point Erdogan’s interventions met with unserious sanctions or opposition from the EU. One obvious reason is the high exposure of EU banks to Turkish lending. Spanish, French, British and German banks have invested more than $ 100 billion in Turkey. Spain is the most exposed with 62 billion, followed by France with 29 billion. This means that the EU is walking on eggshells, unwilling to pour more money into Turkey but hesitant to precipitate a collapse on economic sanctions.

The eastern Mediterranean has become a hot spot for the natural gas industry. The discoveries have generated growing interest among several international oil companies and countries. It all started with Noble Energy (based in Texas) which announced the discovery of the Tamar field off the coast of Israel in 2009, with an estimated capacity of 280 billion cubic meters. In the space of two years, Noble Energy announced two further discoveries: the Leviathan field, also off the coast of Israel, in 2010 and the Aphrodite field, in Cypriot waters, in 2011. This has reinforced regional ambitions to make the Eastern Mediterranean a gas exporting region. . These ambitions were also based on two assessments made by the US Geological Survey (USGS) in 2010, which estimated the presence of nearly 9.8 trillion cubic meters of undiscovered technically recoverable gas and over 3.4 billion barrels of petroleum resources in the area. However, the real turning point (for regional energy ambitions) came in 2015 when the Italian Eni announced the discovery of the gigantic Zohr gas field off the coast of Egypt. With its 850 billion cubic meters of estimated average gross resources, the Egyptian offshore field is the largest ever discovered in the Mediterranean Sea. It should be added that these fields have another feature: geographical proximity. Thus was born a regional alliance with a pipeline project that excludes Turkey from the energy dynamic. The presence of natural gas has become an axis of cooperation and rivalry in the region. It can be said that gas is the main motivation behind Erdogan’s maneuvers. Indeed, Turkey’s unique geopolitical situation stems from the fact that it is poor in hydrocarbon reserves while its neighborhood has abundant resources. It is therefore imperative for Ankara to maintain stable energy ties with neighboring energy-rich countries or regions. In line with Turkey’s growing domestic demand, efforts to focus on energy security have become an integral part of the country’s foreign policy over the past two decades. The search for hydrocarbons, in particular natural gas, has become a fundamental geopolitical and geo-economic objective for the country.

The rationale for Turkish natural gas policies can be described by three aspects:

1. Being a country dependent on imports, Turkey’s main objective is to guarantee its access to natural gas supplies to satisfy its internal demand.

2. aims to diversify its current supply structure and counterbalance Russia’s dominant role in its energy portfolio.

3. Turkey aims to strengthen / increase its integration into the regional energy security architecture by promoting its role as an energy transit country and a potential hub for supplying Europe.

At the moment, the Eastern Mediterranean region does not supply gas to Turkey, with the exception of market agreements with Egypt. However, it emerges as a critical point on the Turkish foreign policy agenda, as the region is viewed by Ankara not only through the prism of energy security, but also through the prism of its protracted conflict with Cyprus and in the broader context of competition for regional power in the eastern Mediterranean.

In line with the above, it is possible to identify at least five key factors that explain Turkey’s greater involvement in the Eastern Mediterranean:

1. Turkey looks for potential gas reserves in its waters that could bring economic benefits to the country.

2. Turkey does not want to be excluded from developing a new regional energy agenda and is ready to protect its interests.

3. Turkey intends to be an energy transit country that could strengthen its role as an energy hub and undermine rival projects such as the EastMed pipeline.

4. Turkey intends to involve other countries in the region to support its objectives, as seen in the case of the maritime border agreement with the government of national agreement based in Tripoli in Libya, to promote its position by preventing it from doing so. way for others to gain influence;

5. Turkey intends to demonstrate its capabilities as a military power in the eastern Mediterranean.

The Greek-Turkish crisis is likely to influence the shift in the balance of power in the Eastern Mediterranean region. It is possible that over time the United States will relocate its military base from Incirlik to one of the military installations in Greece. Athens wishes to modernize and strengthen the army and navy to contain Ankara. Greece, Cyprus, France but also regional actors such as Egypt and Israel do not agree with the Libyan-Turkish synergy. Analyzing the differences in this balance of power, it is clear that Erdogan appears to be in a position of strength. But from this analysis it also emerges that Ankara does not have sufficient capacity to realize its imperialist ambitions .

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Recovery action plan of the Union: On Next Generation EU & a New Independent authority?

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The first address of the European Commission since the pandemic was one highly anticipated by all the citizens of the EU block. On September 16, President Ursula van der Leyden took it upon herself to reveal the EU’s roadmap for a post-Covid world following the approval of the recovery funds last July which constituted a breakthrough and sent a welcome signal in terms of cohesion and solidarity on the part of the 27 members.

Aside from paying tribute to our frontline workforce and praise the courage and human spirit showed by all in the face of virus spread, van der Leyen set out what she called NexGenerationEU; a movement to breathe new life into the EU but also and most importantly to adapt and lead the way into shaping tomorrow’s world. Through her speech, the president highlighted roughly 8 key themes which will be at the centre of this new European era’s agenda for the next 12 months, in accordance with the cardinal principles of trust, tolerance and agility. In other words, the 750 billion recovery funds raised extra-ordinarily will be directed towards the following areas:

1° Economy: the Union members must all breed economies that offer protection, stability and opportunities in the face of the continuous health crisis with a specific wish expressed for a stronger Health union – and thereby an extension of the Union’s competencies on the matter – but also the advent of European minimum wages.

2° Green Revolution: the Union will adopt more radical attitudes towards mitigating climate-change and safeguarding our planet, starting with the ambitious aim of becoming the first climate-neutral continent by 2050 through the EU’s Green Deal. So called ‘lighthouse’ high-impact and hydrogen-based projects will become an additional focus.

3° Technology: Europe has to step up its game and become a digital leader through securing industrial data and using it to support innovation. Delineating the use of AI by regulating the field, creating a secure EU e-identity and ensuring connectivity deployment so as to fully cover rural areas are also high on the list.

4° Vaccine management: The Union praises the open approach followed up until now in facing the virus whilst many others have opted for withdrawal and undercutting of cooperation. Having served as an example regarding vaccines research and funding, the EU must uphold its policy all the way to the finish line and ensure its accessibility for every citizen around the world.

5° Multilateralism: the current international order system needs some rethinking and international institutions need reform in order to de-paralyze crucial decision-making in urgent situations. This starts with the EU taking faster univocal positions on global issues (Honk-Kong, Moscow, Minsk, and Ankara) and systematically and unconditionally calling out any HR abuses whilst building on existing partnerships with EU’s like-minded allies.

6° Trade: Europe will be made out as a figure of fair-trade by pushing for broker agreements on protected areas and putting digital and environmental ethics at the forefront of its negotiations. Global trade will develop in a manner that is just, sustainable, and digitized.

7° Migration: A New Pact on Migration will be put forward imminently as to act on and move forward on this critical issue that has dragged for long enough; in that regard every member state is expecting to share responsibility and involvement including making the necessary compromises to implement adequate and dignifying management. Europe is taking a stand: legal and moral duties arising from Migrants’ precarious situations are not optional.

8° Against hate-inspired behaviours and discriminations: A zero-tolerance policy is reaffirmed by the Union by extending its crime list to all forms of hate crime or speech based on any of the sensitive criteria and dedicating budget to address de facto discriminations in sensitive areas of society. It is high time to reach equal, universal and mutual recognition of family relations within the EU zone.

Granted, the European ‘priorities forecast’ feels on point and leaves us nearly sighing in relief for it had been somewhat longed for. The themes are spot on, catch words are present and the phrasing of each section is nothing short of motivational with the most likely intended effect that the troops will be boosted and spirits lifted subsequently. When looking closer to the tools enunciated for every topical objective, there seems however to be nearly only abstract and remote strategies to get there.

This is because a great number of the decisive steps that the Union wishes to see be taken depend on the participation of various instruments and actors. Not only does it rely for most on the converging interests, capabilities and willingness of nation States (inside and outside the euro zone), but it is also contingent on the many complex layers and bodies of the Union itself. And when a tremendous amount of the proposed initiatives for European reconstruction is reliant on such a far-reaching chain of events, it simply calls into question the likelihood for the said measures and objectives to be attained – or at the very least in which timeframe.

One might then rightfully wonder whether good and strong willpower coupled with comprehensive projections can be enough. And perhaps in the same vein, whether we can afford to wait and let it play out in order to find out? In his recent writing Giles Merritt, founder of the platform ‘friends of Europe’ tends to suggest we most certainly do not have the luxury of waiting it out and not pushing the forward thinking even further. Indeed, according to him, Europe could and should do more. More than a call for action and change that might end up echoing and fading in the depths of the EU’s bureaucracy, the Union would be expected to back up its ambitious intentions with the setting up of an independent planning agency to ‘ensure revolutionary ideas and projects are speedily implemented’, to borrow Merritt’s words.

Whilst van der Leyen’s announcement was promising and efficient in that it sent an important message – the EU is wanting to get in the driver’s seat – only the follow-up with radical motions such as the creation of a readily available tool to implement fast and impactful changes can lend support to a claim that Europe is in a position to resolve current internal and external EU challenges, and more generally to bounce back from conceded decline suffered in the most recent decades.

As a matter of fact, Diplomat Ali Goutali and Professor Anis Bajrektarevic were the firsts to make an analysis in that sense as they articulated their proposal for the Organization of Islamic Cooperation (OIC) earlier this year. Faced with similar challenges and need for sharper thinking and tools in order to be at the forefront of the economic and technologic challenges ahead, the OIC had relied heavily on its Committee on Scientific and Technological Cooperation and agenda reform to reinforce its cooperation and innovation capabilities as a global player.

Nevertheless, Goutali and Bajrektarevic already felt months ago that additional steps ought to be taken for the OIC to be able to respond swiftly and reaffirm further its mandate of facilitating common political actions. To that end, it was suggested that a mechanism for policy coordination in critical times – the Rapid Reaction Capacitation – in charge of, primarily, vaccines management and AI applications should be introduced. Furthermore, the stakes behind the urgent need of strengthening our international order through cohesive endeavours are evidently the same for both the EU and the Arab World. That is to permanently leave behind a pseudo-competitive nation-based attitude that is nothing but a relic from the past and has achieved little in the context of the Covid outbreak.

Hence, if such an independent body was to be established, all three authors agree that it could gather the indispensable political power and resources to carry out the desired reforms on multilateralism, cyber and digital infrastructures, Covid recovery measures or geopolitical partnerships. Necessarily streamlined in order to avoid undue blockades, these new regional bodies could be composed of energetic forward thinkers across the private and public sectors empowered to map out and act on adequate strategies for a post-Covid world. This is because we all share the same goal: achieving solidarity not only on paper or as a conceptual motto but in real life and in real time. And after all, didn’t von der Leyen herself concur with that line of thinking as she enjoined Member states to move towards qualified majority voting to avert slow and cumbersome decision-making processes?

It seems pretty clear to me that such discussions in relation to the aggressiveness in actions and potential bureaucratic barriers might raise an old-as-the-world yet still very important questions: Should we, Europe, be ready to risk losing some of the legitimacy or democratic aspects of our political bodies in order to gain in speed and efficiency in times of crisis? And if not, considering the embracement of some of our supra-national entity’s actions is already on shaky grounds, how can we ensure that such bold measures may still be reconciled with maximal legitimacy given our equally urging need for unity?

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Deciphering EU’s new investment deal with China

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The perceived economic gains of the Comprehensive Agreement on Investments (CAI), which the 27-nation European Union recently struck with the People’s Republic of China, come at the cost of disregarding human rights, which the Western bloc is known for, amid clear and irreconcilable systemic differences.

***

The closing days of 2020 saw the European Union and China striking a deal known as the Comprehensive Agreement on Investments (CAI), thereby concluding seven long years of negotiations, as per the year-end deadline. China is also the EU’s biggest trading partner after the United States, but a strategic and systemic rival too.

The European Commission, Brussels-based executive arm of the EU, primarily led the negotiations on behalf of the bloc. Germany, being the holder the EU Council Presidency and led by Chancellor Angela Merkel’s continued push, combined with Beijing’s last-minute concessions, proved instrumental in expediting the process of finalising the CAI before the end of 2020.

However, the deal will still have to wait for a formal ratification by both sides and an approval by the Strasbourg-based EU Parliament, a tougher task, before finally setting it on course to be effective in a couple of years’ time, if not by early 2022.

Better rules, level-playing field for European businesses

The EU, by this deal, aims to widen the access for European companies to lucrative Chinese markets, with billion-plus consumers, on a wide range of sectors, particularly in services such as healthcare, finance, cloud-computing and air travel, among others, that has always been restrictive to foreign players in the past.

The deal could bring in a level playing field in the conduct of European businesses in China wherein Chinese state-owned enterprises will no longer be given preferential treatment through subsidies, thereby promoting fair competition and ensuring transparency in technology transfers. Newer possibilities for the expansion European businesses in China will be opened.

The CAI also promise better rules, investment protection, and an investment dispute settlement mechanism within two years of signing, which will replace all the separate bilateral investment treaties currently signed between China and EU member states. The EU maintains that the main purpose of this new deal is to address the economic imbalance in its relations with China.

However, the most striking aspect of the CAI is that, for the first time, China commits to follow accepted standards on climate and labour aspects, even though in a vague form. And for the EU, the timing of this deal with China is significant as a way of signalling its reengagement with the world in the aftermath of a post-Brexit scenario.

At the same time, the CAI reaffirmed reciprocal access for Chinese companies into European markets, which they always had. So, the deal matters to Europe, more than it matters to China. So, the real question is the extent of compromises which European negotiators had to make to strike the deal with the Asian superpower.

The issue of forced labour in China

Many EU member countries and the US had been apprehensive about the human rights situation in the northern Xinjiang province of China where there have been evidences and investigations on the use of forced labour from the media and elsewhere, which has not been duly factored in while concluding the investment deal.

It has been alleged that in the past several years, the Chinese government has forced over a million Uighur minorities in Xinjiang to perform seasonal labour against their will and are often underpaid. But, the Chinese government has repeatedly denied such allegations.

Many European lawmakers believe that China is not interested in fully complying with international agreements after signing it and is not a responsible and trustable partner. The presence of mass detention camps in this province, as verified by satellite imagery and other documents, is also a human rights concern which the EU was not supposed to ignore, considering its historical commitments to human rights.

US concerns and strategic rivalry

The incoming Biden administration has also raised concerns about the CAI, stating that it would “welcome early consultations” with its European partners on shared concerns surrounding China’s unfair economic practices, hinting at the issue of forced labour and the deal’s lacking on the question of enforcement of human rights.

Being a security and strategic partner of the US and part of the North Atlantic Treaty Organisation (NATO), any such deal which EU and its member countries sign with its strategic rival, China, could effectively undermine American-led efforts to counter the strategic and geopolitical threat posed by Beijing’s aggressive and expansionist policies around the world.

It also flies in the face of an incoming Biden administration which is openly committed to mend relations with allies in Europe that had been worsened under Donald Trump. Many experts in the US have felt the EU should’ve waited for a few more weeks until the Biden administration takes charge to form a co-ordinated approach, as it related to their common systemic and strategic rival, China.

Moreover, the deal comes at a time when individual EU members such as Germany and the Netherlands have recently released their own outlook on the Indo-Pacific strategy, which is perceivably aimed at containing China’s rise and to ensure balance of power in the region. Meanwhile, France’s outlook is in existence for two years now.

Way ahead for implementation

The deal has now been reached at the technical level, paving way for a final ratification. But, getting the deal through the European Parliament, which attaches far more significance to human rights concerns than the Commission and the Council, is going to be a tough task, as many European legislators are increasingly sceptical of Chinese intentions and commitments to any deal.

The coming months are going to be crucial with regard to how the European legislators will debate and take forward the deal to the next level.

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