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Unilateral vs Bilateral Euroisation: Political, technical and practical issues in the curious case of north Cyprus

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The island of Cyprus has been split between a Greek Cypriot south and a Turkish Cypriot north since 1974. The Turkish Cypriot state declared in the north is recognised only by Turkey, while the Republic of Cyprus in the south is recognised internationally and is a European Union (EU) member since 2004. In 2004, 65 percent of Turkish Cypriots voted in favor of the United Nations’ Annan Plan for reunification only for Greek Cypriots to reject it. As a result, Cyprus joined the EU as a de facto divided island. Despite joining the EU as a divided island, the whole of Cyprus is considered an EU territory. However, the EU law is suspended in the north until reunification is achieved.

This resulted in the euro being the legal tender only in the southern part of the island. With the recent and continuous depreciation of the Turkish lira, the long-standing question of whether and how the north could switch to the euro has once again intensified. While a bilateral adoption of the euro is not on the cards until a reunification on the island, north Cyprus could technically unilaterally adopt the euro. However this could cause complications in the future as the EU is adamant that unilateral euroisation cannot be used as a mechanism by Member States to circumvent the stages foreseen by the Maastricht Treaty.

Under normal circumstances, “Member States with a derogation”, i.e. the Member States that have not yet fulfilled the necessary conditions for the adoption of the euro are first required to enter the Exchange Rate Mechanism (ERM II) to achieve eurozone membership. This is a “waiting room” where any country aspiring to adopt the euro is required to stay for at least for two years. It is now a well-known fact that the ECB shares the opinion of the Economic and Financial Affairs Council (ECOFIN), i.e. the meeting of the finance ministers of EU Member States adopted in 2000, that this requirement should not be waived. Assuming the northern part of Cyprus is considered a Member State, the same principle will apply and therefore it would not be welcome to adopt the euro unilaterally, bypassing the convergence process foreseen by the Treaty for the adoption of the euro.

Currently, ERM II comprises the currencies of Bulgaria, Croatia and Denmark. Just like these countries, north Cyprus would be expected to peg its national currency to the euro and, given the consent of the European System of Central Banks, fixe a “central exchange rate” and a “deviation margin” under Exchange Rate Mechanism (ERM II) for a duration of no less than two years. If successful based on its ERM II performance, a final exchange rate would be determined and the redenomination would be done over a transition period. 

In the case of north Cyprus, it is understood that the EU might have already agreed to apply a fast track approach where there would be a one-year transition period. However, this has not been confirmed officially by the EU so the EU’s stance in practice is not known. After all, even Denmark, a Member State which has negotiated an opt-out arrangement before the adoption of the Maastricht Treaty has been participating in ERM II although it chose not to adopt the euro. So the EU’s approach in the case of northern Cyprus would not expected to be too lenient. There is no way to find out unless north Cyprus continues the dialogue with the EU.

In the meantime, a more relevant question is whether a unilateral euroisation could be possible. The short answer is yes. For instance the euro was introduced in Kosovo and Montenegro that did not have a status of a sovereign state at the time. In both cases, the decision was made in 1999. Kosovo, defined the Deutsche Mark as the designated currency, which was replaced by the euro in 2002. Similarly, Montenegro introduced a parallel currency system in 1999, in which the Deutsche Mark was allowed to circulate alongside the then legal tender. In 2001, the Deutsche Mark became the only legal tender and was replaced by the euro in June 2002.

In the case of Montenegro, now an official EU candidate, the adoption of the euro without an agreement with the European Central Bank (ECB) was acknowledged by the European Commission as a measure which had to be taken due to “extraordinary circumstances” present in the country at the time. This could be precedent for north Cyprus. However, it is important to note that the ECB still supports the view that unilateral euroisation is not compatible with the Maastricht Treaty and cannot be a way to bypass the convergence process.

The implications of the Treaty framework for in the case of Montenegro currently remain unknown and are expected to be detailed “by the time of possible future negotiations for accession to the EU”. In particular it remains uncertain whether the country would be required to introduce its own currency before it can join ERM II. Should this be the case as Montenegro makes further progress towards EU membership, this would entail substantial operational and changeover costs. Authorities in north Cyprus, should therefore monitor the developments very closely.

Normally, non-euro area Member States are denied the option of unilateral euroization due the principle of equality, i.e. the EU considers bypassing the convergence process incompatible with the EU Treaty and actively discourages it.In particular, the Treaty sets out that there has to be a Community assessment of the fulfilment of these criteria and mutual agreement on the appropriate exchange rates. This means that the ECB does not welcome unilateral euroisation, as such an adoption of the euro outside the Treaty process would run counter to the underlying economic reasoning of European Monetary Union.

However, as north Cyprus is already an EU territory the adoption of the euro could be considered a “common interest of the EU” and therefore an exception could be possible. In fact, the policy of the EU with regard to the Turkish Cypriot community which was set out by the General Affairs Council in 2004 states that “the Council is determined to…facilitate the reunification of Cyprus by encouraging the economic development of the Turkish Cypriot community”. So in the case of north Cyprus, a switch to the euro could be allowed by way of exception although this would obviously imply circumventing the process of multilateral assessment by the EU Member States.

While the EU could give the green light to adoption of the euro by north Cyprus without a successful exchange-rate procedure under ERM II, it would not allow this to undermine the process of convergence prior to the adoption of the euro. In other words, the Convergence criteria outlined in the Maastricht Treaty would still remain relevant and important as the Treaty requires Member States to achieve a high degree of sustainable economic convergence before they can join the euro area.

In other words the economies of Member States with a derogation must be able to keep pace with those already using the euro. Exchange rate stability, for instance, is evaluated by assessing whether the exchange rate of the country’s currency has remained within the fluctuation bands provided for by ERM II for at least two years without devaluating against the euro.

Besides exchange rate stability, the convergence criteria also include price stability, sound public finances, and convergence in long-term interest rates. This means, for instance, that a country’s long-term interest rate, measured on the basis of long-term government bonds or comparable securities, should not exceed that of the three best-performing Member States in terms of price stability by more than 2 percentage points during the one-year observation period prior to the assessment.   

On the other hand, a country is considered to meet the price stability criterion if its average inflation rate does not exceed the inflation rate of the three best-performing EU Member States by more than 1.5 percentage points during a one-year observation period. These criteria are intended to ensure the sustainability of public finances and that the government is able to manage its debts.

Article 140 (1) of the Treaty on the Functioning of the European Union (TFEU) requires the European Commission (EC) and the European Central Bank (ECB) to report to the Council, at least once every two years, or at the request of a Member State with a derogation on the progress of the country in fulfilling their obligations regarding the achievement of economic and monetary union. In addition to preparing these “Convergence Reports”, both the ECB and the Commission regularly monitor progress throughout the year.

A Convergence Report is normally published at least once every two years or at the request of an EU Member State which would like to join the euro area. Both the ECB and the European Commission issue these reports describing the progress made by non-euro area Member States towards achieving the criteria necessary for a country to adopt the euro. According to the latest report, among countries legally committed to adopting the euro, Croatia and Sweden fulfil the price stability criterion, Bulgaria, Czechia, Croatia, Hungary, Poland and Sweden fulfil the criterion on public finances, Bulgaria, Czechia, Croatia, Hungary, Poland and Sweden fulfil the long-term interest rate criterion. However none of them meet all the requirements for adoption of the euro. So convergence process is very strict and challenging.

In particular, it should be noted that convergence must be sustainable, meaning that satisfying the economic convergence criteria at one point in time is not enough and they are expected to be met on a lasting basis. A Member State’s general financial position is considered sustainable based on two criteria, namely, the government’s annual fiscal deficit should not exceed 3% of gross domestic product, and overall government should not exceed 60% of gross domestic product. This is very important for northern Cyprus as it will need to ensure that its economy is resilient.

It is known that the Maastricht Treaty provides some flexibility and the final assessment depends on the ECOFIN Council. Whether and how this would apply in the case of northern Cyprus remains a mystery. While details remain unknown to the public, the one-year transition period envisaged in the case of northern Cyprus could be related this. However, it should be noted that the decision on whether north Cyprus can adopt the euro would ultimately be a political one and would lie with the Council of the European Union. This means that representatives from all EU countries would be required to take a decision based on a proposal by the EC and after consulting the European Parliament.

Given that participation in the ERM II is a precondition for as well as fulfilment of the nominal convergence criteria to join the euro, it is binding and is unlikely to be waived for any country regardless of any special circumstances. This is because ERM II provides the framework to manage the exchange rates between EU currencies, which is necessary for exchange rate stability. As such north Cyprus would be expected to participate in the mechanism without devaluing its central rate against the euro before it can qualify to adopt the euro.

While no provision of the EU Treaty states explicitly that Member States with a derogation must have their own currency, the Treaty is by and large based on this assumption. In addition, the entry into ERM II is decided by mutual agreement of all ERM II parties, which consist of the ministers of the euro area Member States, the President of the ECB and the minister and the central bank governor of Denmark, as the only non-euro area Member State currently participating in the mechanism.

So in the case of north Cyprus adoption of the euro could mean that the country should first introduce its own currency. This could be a more viable alternative and north Cyprus could then peg its currency to the euro as a preparation for an eventual switch to the euro. Indeed, some countries joined ERM II with their preexisting currency pegs. To give a recent example, the currencies of Bulgaria and Croatia were already closely tied to the euro at the time of applying to the ERM II. Bulgaria had a currency board, first with the Deutsche Mark, and subsequently with the euro after 1999. Croatia had a peg first with the Deutsche Mark, and from 1999 to the euro, with a narrow band.

During this process, legal requirements should not also been underestimated. Article 140(1) of TFEU requires the convergence reports to assess the compatibility of national legislation, including the statutes of the national central bank and the Statute of the European System of Central Banks and of the ECB. There could also be additional unprecedented requirements and countries may be required to commit to implementing specific policy measures on a variety of topics. For instance, in the case of Bulgaria and Croatia, such requirements range from the anti-money laundering framework, state-owned enterprises and the insolvency framework, to the non-banking financial sector, corruption and even organised crime. It is highly unlikely that the national legislation in north Cyprus is currently compatible with that of the EU as the latest convergence report suggests that the respective national legislations in none of the seven new EU Member States would be deemed “fully compatible” with the exception of Croatia.

In fact, the former north Cyprus President Mustafa Akıncı himself had confessed that “serious work” would needed to ensure the harmonization of the national institutions with the EU acquis. As can be seen in the case of Croatia and Bulgaria, this has now become a prerequisite not only for joining the EU but also in terms of adopting the euro as a new Member State. For instance, this was the main reason behind the delay in Bulgaria’s acceptance to ERM II. Bulgaria was able to get the green light to join ERM II two years after it formally announced its intention to join the mechanism.

The delay was due to the requirement imposed by the Eurozone governments requiring Bulgaria to join ERM II and the Banking Union simultaneously. This prerequisite is known as “the Cooperation Decision” and requires Member States which adopt the euro to also participate in the Banking Union, i.e. the Single Supervisory Mechanism (SSM), the Single Resolution Mechanism (SRM) and the Single Resolution Fund (SRF). . Therefore, participating in ERM II with a view to later adopting the euro will also involve preparing for joining the Banking Union.

This requirement will now apply to all future candidates including north Cyprus. However, it should also be noted that the procedure for entering the Banking Union is separate from the assessment of the convergence criteria. Joining the Banking Union is irreversible and involves direct powers of the SSM and the SRM over its banking system. This has important implications for the banking sector as banks that will come under the direct supervision of the ECB will also be subject to the direct supervision of the Single Resolution Board (SRB).

To be more specific, this means that, the ECB will become responsible for the direct supervision of the significant credit institutions following the “significance assessment process”. This applies to banks considered to meet the “materiality criteria” as set out in the SSM Regulation (Regulation 1024/2013) and the SSM Framework Regulation (Regulation 468/2014). The criteria include “economic importance for the country” so could technically apply to banks in north Cyprus despite their insignificant sizes in comparison to the EU economy. Therefore, for new joiners like north Cyprus the accession process would involve not only the harmonization with the aquis but also the strengthening of their institutions and administrative capacity that will enable them to implement and monitor the enforcement of the harmonized legislation.

Therefore, adoption of the euro by north Cyprus, bilaterally or unilaterally, would not be as easy as it may look. More than anything else, this would require political will, courage and determination. The former President Mustafa Akıncı, a devoted supporter of a federal solution and the EU, had set an ambitious target of the euro going into circulation “from the first day” in the case of a reunification. However with the failure of the last reunification talks in 2017 in Crans Montana, Switzerland, political conditions have changed dramatically. The current President Ersin Tatar who is a very passionate proponent of the two-state solution is wholeheartedly against the EU and the euro. Therefore, the general stance towards the adoption of the euro in the northern part of the island remains fragmented. Given these circumstances, adoption of the euro in north Cyprus seems a distant prospect.

Mete Feridun serves as the Chair of the Center for Financial Regulation and Risk Management and a Professor of Finance at the Department of Banking and Finance at Eastern Mediterranean University. He previously worked at the Bank of England, Prudential Regulation Authority, and the Financial Conduct Authority. He also served as a regulatory strategy consultant at PwC and has held various visiting professor positions at University of Cambridge, University of Oxford, London School of Economics and King’s College London.

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Is European humanity skin deep?

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At the border crossing between Ukraine and Moldova at Palanca, refugees stand in line. © UNICEF/Vincent Tremeau

When talking about security the most common line of thought tends to be war and the actors involved in the attack, however, all the people who had regular lives within those territories that are jeopardized are as important. With the increasing tensions and armed conflicts happening within the Twenty First Century, the movement of people searching for shelter has increased. More asylum seekers leave their home countries every single day and contemporary politics is still struggling to find a way to catch up. Europe, history wise, is the zone of the world that deals with more refugees wanting to enter the continent due to different factors: geography, proximity, democratic systems, level of development and more. Nevertheless, with the Russia-Ukraine conflict, true sentiments towards refugees are now being put on display.

Even though all refugees are fleeing their countries because their lives are in mortal danger, authorities and government officials do not seem to care. Processes to apply for the refugee status are getting harder and harder. In Europe, to apply for a refugee passport, people are asked for identifications, online questionaries and many other unrealistic aspects that if not answered correctly, the whole process is cancelled. It is ridiculous to believe that when people are scaping in order to stay alive, they will take under consideration all these requirements to receive help, sometimes even from neighboring countries. Which inevitably leads to the following question: why are refugees accepted based on the legality of their applications and not of their status?

By 2016, nearly 5.2 million refugees reached European shores, which caused the so called refugee crisis. They came mainly from Syria, Afghanistan, and Iraq: countries torn apart by armed conflicts. Similarly, with Russia’s invasion over the Ukraine in 2022, only few days deep within the fighting,  874,000 people had to flee their homes. Nonetheless, the issue seems to be that, for Europe, not all refugees are the same. When the refugee crisis in 2015 was declared, the European Union called for stopping and detaining all arriving refugees for around 18 months. There was a strong reluctancy from Europeans towards offering them shelter. On the contrary, countries such as Poland and Slovakia have said that Ukrainian refugees fleeing will be accepted without passports, or any valid travel documents due to the urgency of the situation. Therefore, stating with their actions, that Ukrainian refugees are more valuable or seem to be more worthy of help than refugees from Asia, Africa, or the Middle East.

Correspondingly, it is true that not all countries inside Europe deal and act the same way towards refugees, be that as it may, with the current refugee crisis it has been proved that they all share strong sentiments of xenophobia and racism. For instance, Hungary is a country that refused to admit refugees coming from outside Europe since 2015. In 2018, Prime Minister Viktor Orban described non-European refugees as “Muslim invaders” and “poison” to society, in comparison with Ukrainian refugees who are being welcomed without hesitation. In the same way, Jarosław Kaczyński, who served as Prime Minister of Poland and is the leader of the Law and Justice party, in 2017 said that accepting asylum seekers from Syria would be dangerous and would “completely change our culture and radically lower the level of safety in our country”. Furthermore, Germany in 2015 with Chancellor Angela Merkel in charged said that they would accept one million of Syrians. Although, as time passed, Europe’s solution was to make a deal with Turkey, who is not part of the European Union, to close the migrant route. Moreover, the promise of letting refugees integrate into German society was not fulfilled since. Seven year later, an impressive amount of refugees are still in camps and centers, with their lives frozen in time. Sadly, most European governments gambled towards the idea of sending them back once the armed conflict was over, without caring for the aftermath of war’s destruction.

The common narrative until now pushed by leaders, politicians, and mass media has been that Ukrainians are prosperous, civilized, middle class working people, but refugees coming from the Middle East are terrorists, and refuges from Africa are simply too different. Despite, refugees are all people who share similar emotions and struggle to grasp the fact that their lives may never be the same; having lost their homes, friends, family and so much more. Plus, being selectively welcomed based on their religion, skin color or nationality by the continent which’s complete rhetoric is universal rights, just adds another complex layer to the issue. Conjointly, the displacement of people due to war displays how regular individuals are always the ones who suffer the most in consequence to the interests of the few that represent larger powers. Hence, greed, envy, and cruelty are stronger than recognized, even in a developed continent such as Europe.

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What Everyone Should Know About Preventing Ethnic Violence: The Case of Bosnia

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Image source: srebrenica.org.uk

When the Balkans spiraled into violence and genocide in the 90’s, many wondered what caused this resurgence in militant ethnic nationalism and how a similar situation may be countered.

***

The 1990’s were a vibrant decade, that is unless you were living in the Balkans. 1995 was especially bad, as the 11th of July of that year marked the Srebrenica Massacre, which saw Serbian soldiers murder over 8,000 Bosnian Muslims over the span of two weeks. This shocked the world, as it was the first case of a European country resorting to extreme violence and genocide on ethnic lines since World War II. After World War II, the idea that a European country would resort to genocide was unthinkable. As Balkan nations continue to see the consequences of the massacre after over 25 years, it is increasingly evident that more needs to be done to curb ethnic violence.

We must first investigate key causes of ethnic violence. According to V.P. Gagnon, the main driver of ethnic violence is elites that wish to stay in power. Ethnic nationalism is easy to exploit, as creating a scapegoat is extremely effective for keeping elites in power. This is exactly what happened in Yugoslavia, which had previously seen high levels of tolerance and intermarriage in more mixed areas that saw the worst violence during the war. Stuart J. Kaufman argues that elites may take advantage of natural psychological fears of in-group extinction, creating group myths, or stereotypes, of outgroups to fuel hatred against them. While they may take different approaches to this issue, Gagnon and Kaufman agree that the main drivers of ethnic violence are the elites.

David Lake and Donald Rothchild suggest that the main driver of ethnic conflict is collective fears for the future of in-groups. Fear is one of the most important emotions we have because it helps secure our existence in a hostile world. However, fear can easily be exploited by the elites to achieve their personal goals. In a multiethnic society such as Yugoslavia, the rise of an elite that adheres to the prospects of a single ethnic group could prove dangerous and sometimes even disastrous. The destruction of Yugoslavian hegemony under Josip Broz Tito and the resulting explosion of ethnic conflict at the hands of Serbian elites in Bosnia underline this because of the immense fear this created.

Regions with high Serb populations in Bosnia sought independence from the rest of the country when they found themselves separated from Serbia by the dissolution of Yugoslavia. Republika Srpska was formed by these alienated Serbs. The leadership and elites in Serbia riled up the Serb population of Republika Srpska by stereotyping and demonizing Bosnian Muslims as “descendants of the Turkish oppressors”. This scared the Serbs in Bosnia so much so that they obeyed the elites of Serbia in supporting and fighting for the independence of Republika Srpska by any means necessary. As was seen in Srebrenica, they were not opposed to genocide.

We know how the elites fuel ethnic tensions to secure power as well of the devastating effects of these tensions reaching their boiling point. But what could be done to address ethnic conflict? David Welsh suggests that a remedy for ethnic conflict could be the complete enfranchisement of ethnic minorities and deterrence towards ethnic cleansing. This means that we must ensure that ethnic minorities are able to have a say in a democratic system that caters to all ethnicities equally. Fostering aversion to genocide is also vital toward addressing ethnic conflict because it is the inevitable result of unchecked ethnic conflict.

There is also the issue of members of ethnic groups voting for candidates and parties on ethnic lines. For example, in the United States, White American voters have shown to prefer White candidates over African American candidates, and vice versa. Keep in mind that the United States has a deep history of ethnic conflict, including the centuries-long subjugation of African Americans by White Americans.

Ethnic violence is horrifying and destructive, but it can be prevented. The first measure would be the establishment of a representative democracy, where members of all ethnicities are accurately represented. Another measure would be to make ethnic conflict and ethnic stereotyping taboo so that the average person would not resort to genocidal behavior once things go wrong. Lastly, making people feel secure is the most important step towards preventing ethnic conflict. If the people feel secure enough, they will not even need to think about ethnic violence. In short, while it is important to consider the differences of the various ethnic groups in a multiethnic society, it is vital that each group is kept represented and secure, free of any fears of subjugation.

While the case of Bosnia was extremely unfortunate, it provides an integral view into what could happen if perceived subjugation and fear of eradication reaches a breaking point. As was seen in Bosnia, ethnic violence can be extremely violent, resulting in untold suffering and death. That is why we must take necessary steps towards de-escalation and remediation of ethnic conflicts. These measures can, quite literally, save millions of lives.

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French Presidential Election 2022 and its significance for Europe

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Eugene Delacroix’s infamous painting “la liberté Guidant le Peuple” reminds the whole world of the July Revolution of 1830 that toppled King Charles X of France. The lady in the centre of the painting with the French tricolour still symbolizes the concept of liberty and reminds the whole world of revolutions and sacrifices made for freedom. France indeed has a long journey from revolting against “if they have no bread, let them eat cake” in 1789 to establishing a modern democratic society with the principles of “liberty, equality and fraternity”.  

France and the United States are rightly considered the birthplace of modern democracy. The French revolution taught the whole world lessons about revolution, freedom modern nationalism, liberalism and sovereignty. In 2022, France celebrates the 233rd year of Bastille Day which led to a new dawn in the French political system. From establishing 1ere Republique (1st Republic) in 1792, France has evolved and is currently under the 5eme Republique (5th Republic) under the constitution crafted by Charles de Gaulle in 1958.

Today, France is holding its presidential elections. As the French believe, ‘You first vote with your heart, then your head’, the first round of voting was concluded on Sunday 10th April and the Presidential debate on 20th April 2022. While the whole world waits for the 24th of April’s second round of elections and their results, this article attempts to understand the French electoral system and analyze Why French Presidential elections are important for Europe?

French electoral system

France is a semi-presidential democracy; the president is at the centre of power and Prime Minister heads the government. The president of the French republic is elected by direct universal suffrage where all French citizens aged 18 and above can vote, whether residing in France or not. In France, there is a two-round system in which voters vote twice on two Sundays, two weeks apart. This two-round system is widely practised in central and eastern Europe as well as Central Asia, South America and Africa.

In order to apply, a candidate needs 500 signatures of elected officials and they should be at least from 30 government departments. A candidate can be an independent or he or she can represent a political party. There is no limit to how many candidates can run for presidential elections. For instance, in 2002 there were 16 candidates, in 2017- 11 and in 2022 there are 12. While all the candidates have the right to equal media presence, the amount of spending on campaigns is also monitored; for the 1st round, the spending must not exceed 16.9 million euros and for the second round, it has been limited to 22.5 million euros.

This year, the 1st round of voting was concluded on 10th April while the second one is scheduled to be held on 24th April 2022. In the first round, all 12 candidates were eligible but for the second round, only two candidates who got the maximum votes are qualified for the second round.

A brief overview of French presidential candidates

Emmanuel Macron, five years ago at the age of 39, became the youngest French president of the French republic. In 2017, he broke the dominance of the two major French parties- Republicans and Socialists- by running a campaign “neither left nor right”. During the tenure of Emmanuel Macron, a hardcore centrist, France has witnessed a 7% GDP growth, unemployment dropped by 7.2% and the crime rate has fallen to 27%.

A far-rightist, Marine Le Pen is the other presidential candidate who succeeded her father, Jean-Marie Le Pen, as leader of the National Front (later National Rally) party in 2011. She was also contesting against Emmanuel Macron during the 2017 elections and before that in 2012, against Nicolas Sarkozy and Francois Hollande. While she embraced the party’s anti-immigration stance, she rebranded the party’s Euroskepticism as French nationalism.

This year, in the April 2022 elections, the current President of France, Emanuel Macron and far-right leader, Marine Le Pen are the two candidates with Macron running ahead with a lead of 4.7 per cent votes (Emmanuel Macron-27.8% & Marine Le Pen- 23.1%).

Why French Presidential elections are important for Europe?

While European defence is primarily assured by the US-led NATO military alliance, of which most EU states are members, French president Macron said,  “Europe needs to finally build its own collective security framework on our continent…”, advocating for a ‘European Security’ framework amid tensions with Russia over Ukraine.

On the other hand, Le Pen’s party has been looked upon suspiciously that it might have received financing from a Russian bank connected to the Russian President Putin. In an interview with French public radion, Le pen said, “It will be necessary diplomatically, when the war [in Ukraine] is over, when a peace treaty has been signed, to try to avoid this tie-up which risks being the largest danger of the 21st century for us,” she even further added, “Imagine … if we let the first producer of raw materials in the world — which is Russia — [create an alliance] with the first factory of the world — which is China — to let them perhaps constitute the first military power of the world. I believe that it’s a potentially great danger.” These statements only further reinforce the claims that Le Pen is more pro-Russia.

While Macron is anti-Brexit, Le Pen, on the other hand, has been known for her ‘Frexit’ plan, meaning, that she wanted France to leave the EU and abandon the euro. However, during the 2022 elections, it appears that Le Pen has softened her stance on Frexit. Another important issue pertaining to immigration has been significant not only for France but the whole of Europe. This issue of immigration is directly linked with the “economic and cultural concerns” which raises an important worry about immigrants’ socio-political and economic integration into the French society and abiding by the principle of laïcité (secularism with French characters).

As for Macron, he wants to create a “rapid reaction force” to help protect EU states’ borders in case of a migrant surge and is also pushing for a rethink of the bloc’s asylum application process. Macron also said that he urges the EU to be more efficient in deporting those refused entries. On the other hand, Marine Le Pen during her campaign stated, “I will control immigration and establish security for all.” It is pertinent to note that Macron has introduced strict laws pertaining to immigration and controlling Islamic radicalization. For instance, he introduced the bill to ban foreign funding to mosques.

What is more interesting to mention is the concerns about ‘energy’ in the presidential election. Evidently, the ongoing conflict in Ukraine has gained more attention on the economic and geopolitical consequences of existing national and European energy supply chain choices. In France especially, there is a major rift between the pro and anti-nuclear power fractions. Interestingly, France has the second most nuclear power stations in the world after the United States.  Besides, in the last week of the elections, Macron has been attempting to win the hearts of the French voters with his proposal for a “complete renewal” of his climate policy. He has also promised to build up to 14 nuclear reactors by 2050 and regenerate existing plants. Meanwhile, Le Pen has promised to build 20 nuclear plants and aim to have nuclear power provide 81 per cent of France’s energy by 2050. While the current president Macron and far-right candidate Le Pen have both committed to the 2015 Paris Agreement to limit global warming, it is evident that their approaches differ particularly on energy. Since France is Europe’s second-biggest economy, France’s climate policy could echo right across the EU.

Besides, in light of the ongoing Russia-Ukraine crisis, Macron has played a significant role as he is the bridgehead for Russia and the US. He has also negotiated talks between Washington DC and Moscow and has also condemned the crisis by making the statement, “Russia is not under attack, it is the aggressor. As some unsustainable propaganda would have us believe, this war is not as big as the battle against, that is a lie.” Indeed, he has played the role of Europe’s de-facto leader vis-à-vis the Ukraine crisis. Nonetheless, with a marginal win in the first round against Marine Le Pen, winning the 2nd term is not as easy as it was five years ago.

More importantly, it is pertinent to note that France has the 2nd strongest military and 2nd biggest economy in Europe, further the 5th biggest economy in the world. France is not only the most visited country in the world but also ranks 1st in the global soft power index. It is also the founding member of the United Nations Security Council, North Atlantic Treaty Organization and the European Union which makes it an important player in European politics. Consequently, the policies of the French leadership not only direct the political, social and economic lives of the French but also reverberate in Europe.

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