The European Union on the International Scene

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The European Union on the International Scene

Who speaks for Europe? Although Henry Kissinger disputes that he ever asked the question, it is a valid issue and one that is being discussed again at the Convention on the Future of Europe which began its proceedings in Brussels on 28 February 2002. In the Laeken Declaration of 15 December 2001, the European Council had already posed three pertinent questions. How should the coherence of EU foreign policy be enhanced? How is synergy between the High Representative and the competent Commissioner to be further reinforced? Should the external representation of the Union in international fora be extended further?

In some future date, it might be very simple. The President of Europe will speak for Europe. But we are far, far from a federal Europe and in the meantime it is important to discuss ways of improving the coherence of EU foreign policy and the external representation of the EU. The manner of the EU’s external representation currently varies between different policy areas. There are also different modalities for the common foreign and security policy (CFSP), trade, financial, economic, environmental and development affairs.

In recent years, the EU has successfully demonstrated its ability to defend European interests whenever it has acted in a unified manner. Successive WTO negotiations bear as much witness to this strength as the successful outcome of the negotiations on the implementation of the Kyoto protocol in 2001. But in other fora, especially relating to international financial and economic issues, the record has been mixed at best. The fact that the external face of the Union needs an uplift is rarely disputed. The disputes arise when proposals are put forward that might change the delicate balance between institutions and between the institutions and the Member States. This chapter considers the present arrangements for external representation of the EU and considers proposals for change.

Foreign and Security Policy

Every six months the US secretary of state has a new European interlocutor. It is little wonder, therefore, that Colin Powell knows the telephone number of Javier Solana, the EU’s High Representative for CFSP, rather than whoever of the fifteen foreign ministers of the EU is currently holding the presidency of the Council. It helps, of course, that the office of High Representative is filled by someone of such high stature as Solana and that he has a mandate for five years. But the fact that he is increasingly referred to, albeit erroneously, in the world’s media as ‘the EU’s foreign policy chief’ demonstrates the problems of the EU’s external representation.

When it comes to military action, whether in Kosovo or Afghanistan, the first addresses for Washington are London, Paris and Berlin. Although Colin Powell has Solana’s telephone number, Washington may need to call one of several Commissioners dealing with aspects of external relations. Depending on the subject under discussion, it could be Chris Patten for sanctions, Pascal Lamy for trade disputes, Gunter Verheugen for enlargement issues, Pedro Solbes for international economic issues, Margot Wallström for the environment and Paul Nielson for development and humanitarian subjects. Washington may also wish to speak to one of the EU’s special representatives dealing with the Middle East, the Great Lakes, or Kosovo. If the US, with its lengthy history of close co-operation with the EU finds the situation baffling, other partners are even more perplexed.

Under the treaties, it is the six monthly rotating Council presidency that represents the EU to the outside world. Mr CFSP, as the High Representative is often known, is merely tasked with ‘assisting the presidency’, in particular conducting political dialogue with third parties. The European Commission is “fully associated” to all aspects of CF SP, including implementation and representation. Depending on circumstances, the EU may be represented, therefore, by the presidency alone, the presidency and the Commission, or by the troika.

The UN poses a special problem for the EU. Two of the Member States, Britain and France, are permanent members of the UN Security Council and although both London and Paris are on record as favouring reform, the proposed changes would add one or more Member States to the UNSC rather than a single EU seat. Co-ordination between Member States at the UN has improved in recent years but there is still regular criticism of Britain and France pursuing national as opposed to EU interests in the UNSC. With regard to the OSCE, it is the presidency who speaks for the EU when there is an agreed position. On economic issues, it is the Commission that takes the floor. But as Member States nearly always exercise their right to speak at OSCE meetings, this tends to dilute any EU message. The position of the EU in the Council of Europe is equally weak.

The CFSP is supported by a large bureaucratic machinery partly based in Brussels, partly in the foreign ministries of the Member States and in the diplomatic missions of the Member States and the Commission scattered all over the world. While foreign ministers take the decisions, their meetings are prepared by the relatively new Political and Security Committee (PSC), composed of ambassadorial rank officials who meet usually twice a week. They, in turn, are supported by various layers of officials who exchange views with capitals and diplomatic missions through a confidential (coreu) telex network.

Outside Brussels, the EU disposes by far the largest diplomatic network in the world. More than 40,000 officials work in the foreign ministries of the Member States and the circa 1500 diplomatic missions abroad. Each Member State maintains between 40 and 160 diplomatic missions while the Commission has a network of over 120 delegations around the world. In comparison, the US has about one third of the human resources that the EU devotes to diplomacy and one fifth of the diplomatic missions. But as Javier Solana dryly noted, it is not apparent that the US is less effective than the EU in pursuing its policy objectives.

European foreign policy consists of two separate strands, a national and a European. Member States deploy most of their diplomatic resources on promoting their national interests around the world, especially in the commercial, cultural and foreign aid fields. But increasingly there is recognition that national interests may often be better promoted by working through the CFSP machinery. No one Member State, however big, will be able to exercise the same clout with Russia or China or whoever than the EU acting together. There are also fewer and fewer pure national interests, partly because of the decline of European colonial possessions, and partly because there has been a slow but steady convergence of how Member States view the outside world. Even in sensitive policy areas such as the Balkans and the Middle East, the EU has made considerable strides forward in hammering out a common policy. This is the essence – a common policy. The EU is not trying to establish a single foreign policy. It recognises that the principle of subsidiarity also applies in foreign affairs and hence only seeks to intervene as a Union when there is clear added value.

Another problem for the EU is the pillar structure that was created when CFSP was established. A disproportionate amount of time is spent in arguments over whether an issue falls under the first pillar, and hence subject to ‘community procedures’, or the second pillar, and hence ‘inter-governmental procedures’. There are many grey areas, such as the non-military aspects of security policy, e.g. de-mining, international police, which contribute to the EU’s poor reputation for acting swiftly in CFSP.

The Future of CFSP

The quickening pace of change in the CFSP, combined with the perspective of enlargement, is likely to raise a number of sensitive issues. What are the common interests of a Union comprising 25 plus Member States stretching from Sweden to Cyprus, from Ireland to Estonia ? What will enlargement mean for decision-making and the role of the presidency ? Will the European Security and Defence Policy (ESDP) with its planned 60,000 strong rapid reaction force provide sufficient muscle to support CFSP ? What are the implications for relations with the US? And NATO?

A number of proposals have already been put on the Convention table to strengthen CFSP. In terms of the EU’s external representation these include proposals to abolish the rotating presidency, to merge the Solana/Patten positions and to strengthen the EU input and output from the EU’s diplomatic missions. The advocates of abolishing the presidency argue that the previous benefits of sharing the load and giving each foreign ministry a chance to shine for six months no longer apply in a Union of 25 or more Member States. There is certainly a genuine question mark over the capacity of some of the small applicant states to perform the external representational and implementation roles of the presidency. Even Belgium, a founding EC member, admitted to being over-stretched at the end of its presidency in 2001.

One alternative would be a team presidency comprising a large, medium and small Member State. While this proposal would bring the advantage of burden sharing, it would not solve the problem of lack of continuity. A variation on this idea would be an elected CFSP president for a longer period, perhaps two and a half years. The British Foreign Secretary, Jack Straw, proposed such a solution for a reduced number of sectoral Councils. This would provide for greater continuity but could pose problems if the national government holding the office changed during the period or if the position became a reserved domain for the larger Member States. Yet another proposal would downgrade the representation role of the presidency and give that to Mr CFSP, with the Commission involved as appropriate. Another proposal, certainly unlikely in the near term, would merge the positions of High Representative and External Affairs Commissioner. While there is obvious merit in such a merger, due to greater continuity, coherence and visibility, it is unlikely that the foreign ministers would wish to see so much power in the hands of any one individual.

Change will be difficult but if there is no change then there is a real danger of a directoire of the major foreign policy actors (UK, France and Germany) replacing the established structures for CFSP. There are already signs, post 11 September, of the major Member States preferring to meet and act together rather than use EU structures. The leaders of Britain, France and Germany met together prior to the European Council in Ghent to discuss Afghanistan. Tony Blair invited a select group to dinner in Downing Street for discussion on the same topic. It was argued by Blair that this was a more effective way of conducting business, especially as he had invited the leaders of those countries principally involved in supporting the US military campaign. Romano Prodi and other leaders were not convinced.

The impact of enlargement to 25 Member States will inevitable bring significant changes. A simple tour de table with each minister limiting him/herself to three minutes would take an hour and a quarter. Tony Blair and Gerhard Schroeder have proposed that essential points should be circulated in writing instead of a tour de table, that more decisions should be taken at a lower level and that there should be more use of qualified majority voting (QMV). They did not, however, propose more QMV for CFSP. QMV does exist in some areas of CFSP but has rarely been used. Further proposals to streamline the operation of the Council are being prepared by the Council secretariat and by Member States for submission to the Convention.

Enlargement may also provide a fresh impetus to the trend towards sharing diplomatic and other facilities in third countries. It is arguable whether the EU really needs fifteen or twenty-five separate representations in Peru, Angola or Vietnam. There is considerable scope for rationalisation as well as more joint reporting from third countries. One of the problems here is overcoming the national mentality of most Member State diplomats. It is not just the case that they receive their instructions from national capitals and are paid by national capitals but that many have no direct experience of the Brussels machinery and procedures. Few national diplomats pore over treaty texts before arriving en poste. The level of EU co-operation, co-ordination and visibility thus often depends on local personalities.

Moves to strengthen the public face of CFSP should also involve the European Parliament and perhaps national parliaments in Member States. At present, there is almost no public debate on the CFSP, something that Elmar Brok, the chairman of the EP Foreign Affairs Committee would like to change. One idea might be to have a debate every six or twelve months held simultaneously in the European Parliament and national parliaments; The material for the debate could be provided by the High Representative setting our the priorities for the CFSP. Solana’s policy planning unit might also be encouraged to draw up a mission statement for the CFSP and elaborate a European security concept. The aim would be to engage foreign ministers in a regular discussion of CFSP with their national parliaments. It might also be possible to invite the High Representative to meet with representatives of the Foreign Affairs Committees of national parliaments. These moves should help make the CFSP more visible to citizens across the Union. Public opinion is strongly in favour of more common action in foreign and security policy. It will be important to maintain this support.

The EU’s Representation in Other International Fora 

The confused external representation of the EU in CFSP is mirrored in many other policy areas. The one notable exception is trade policy which has been an area of community competence for some time. In international trade negotiations it is the Commissioner for Trade (Pascal Lamy) who represents and speaks for the EU. The advantages of this approach for all Member States have been proved in many trade negotiations, from the Kennedy Round to the Uruguay Round, and most recently at Doha for the launching of the Doha Development Agenda. A Trade Commissioner is not an unguided missile (though Lamy enjoyed the nickname of ‘the Exocet’ when he was chief of staff to President Delors). He consults regularly with trade ministers from Member States and there is an important official body, the 133 committee, that approves negotiating guidelines for the Trade Commissioner.

In the environment arena, an area of mixed competence between the community and the Member States, there has been an ad hoc approach in recent years. The limitations of the six monthly rotating presidency have also been exposed in international environment negotiations which usually last several years. As in the CFSP domain, there are substantial differences in capacities between the Member States. Some favour giving the Commission a negotiating mandate, as in trade policy, but others are opposed to what they would regard as ‘increased power’ to the Commission. For its part, the Commission would need more resources in this field if it were to take on such a role. In the negotiations on climate change and implementation of the Kyoto Protocol, it is the Presidency which negotiates on behalf of the EU although the Commission plays an important role, in particular on issues which need to be coordinated and harmonized.

In recent years, some informal arrangements have been put in place to maximiz e the EU’s impact in international environmental negotiations, to facilitate preparations and to ensure continuity. Two specific ad hoc experiences deserve mention. First, the ‘lead-country approach’ in the Commission on Sustainable Development (CSD). The CSD’s annual meetings have a broad agenda covering several sectoral and cross-sectoral themes. To facilitate EU preparations, work is shared among Member States and the Commission. For each topic on the agenda, a position paper is drafted by the lead-country which, once discussed in the Council Environment and Development Group, becomes the official EU position. Second, the “EU-team” approach in the biosafety negotiations. In these negotiations, the EU was represented by the presidency and the Commission with a preponderant role for the latter. At the same time, it was agreed to set up an expert team composed of Member State officials, chosen mainly on the basis of their individual expertise, who played an important role of technical support throughout the negotiations.

G7/8 and the IFIs

In the sphere of international finance and economics, a more rigid attitude to demarcation of competencies means, that despite the introduction of the euro, the EU continues to punch below its weight in international fora. With the shift, in euro zone countries, of monetary policy sovereignty from national level to the European Central Bank (ECB), the EU’s role in international economic and financial governance has increased significantly although there are still problems stemming from the non membership of some Member States in the eurozone and jealousies surrounding participation in G7/8 meetings.

The EU’s role in the G7 – later G8 – has developed gradually over the years. In the early years, the Commission president was allowed to attend but not speak. Later, he was allowed to speak but his subordinates were not allowed to participate fully in meetings of finance ministers. Later still, the EU presidency was admitted, unless the holder was already a G7/8 member. At the G7, the finance minister chairing the euro zone (unless from a G7 country) is only allowed to attend the part of G7 finance meetings where the economic situation and outlook and international exchange rates are discussed. He is not allowed to participate in other discussions such as on the reform of the international financial and monetary architecture. The European Central Bank president enjoys the same limited rights. Moreover, the presidency (unless from a G7 country) does not participate in the preparation of G7 Finance meetings. As a result, participation of a non-G7 presidency in G7 Finance is somewhat symbolic. Up till now, the Commission only attends the discussions on Russia and is not involved at all in the preparatory process.

The situation is further complicated because of the G7’s move to G8 with Russia involved in some, but not all of the discussions. Given the lack of substance of G7/8 meetings, it is not surprising that there have been calls, not just from anti-globalization protesters, to abolish the G7/8. Abolition is unlikely but the G7/8 could either be transformed into a G20 (upgrading the existing G20) or a G3 with the US, EU and Japan or East Asia as members. As in any international grouping there is often a trade off between increased size, and thus greater legitimacy, and reduced size, and allegedly greater efficiency.

In 1998, the European Council agreed rather complicated guidelines on the Community’s external representation in financial affair. For meetings of G7 finance ministers ‘the president of the ECOFIN Council, or if the president is from a non-euro area Member State, the president of the Euro 11, assisted by the Commission’ participates. Community views on other issues of particular relevance to the EMU would be presented at the IMF board by ‘the member of the executive director’s office of the Member State holding the euro presidency, assisted by a representative of the Commissi on.’ On issues of particular relevance to economic and monetary union, the conclusions encouraged the Commission, Council and Member States to prepare common positions for presentation in international fora but it was recognized that this might be hindered by not being fully associated with the preparatory processes of international meetings.

So far, ad hoc solutions to external representation have prevailed for the IMF, G7 finance ministers, the Financial Stability Forum, the G20 and other groupings where issues relevant to EMU are discussed. Member States have begun to realize, however, that these ad hoc solutions are not the best way for the Community’s voice to be heard internationally. There is also increasing pressure from emerging markets and non-European G7 countries for streamlining EC representation in bodies such as the IMF. In the OECD, the Commission has a specific status since 1963 and the ECB has been granted observer status. Problems of external representation are therefore limited to finding pragmatic solutions that organize relations between the presidency, the Commission and the ECB.

In the IMF, procedurally, the euro area dimension has been taken into account by the twice yearly consultation of the euro area economic policies in addition to the traditional EU national consultation process. Institutionally, however, less progress has been made. The 1945 IMF Articles of Agreement confer on countries the right to become members. This is difficult to reconcile with the specific nature of the EU and EMU, in particular as the IMF is an IFI with a monetary character when precisely euro area Member States have ceded sovereignty over monetary issues. Also, the IMF decision taking process, with countries grouped in mixed EU/non-EU constituencies can sometimes be at odds with the EU’s need to respect EU treaty requirements on position taking and representation.

A second set of issues concerns Community procedures for presenting positions at IMF meetings. The Council (not the Eurogroup) presidency delivers a statement on behalf of the Community at the six-monthly meetings of the International Monetary and Financial Committee. Efforts are being made to co-ordinate the positions of EU executive directors in the IMF Board and in putting the Eurogroup presidency representative in charge of conveying the EC position, if any, to the rest of the Board. The ECB has obtained observer status in the IMF Board and can attend when issues of particular relevance for the euro area are debated.

Under the Articles of Agreement of the International Bank for Reconstruction and Development (IBRD), a country must first join the IMF before it may become a member of the World Bank. Given this, and the fact that World Bank voting constituencies are organised along similar (sometimes mixed EU/non-EU) lines as in the IMF, the situation regarding EC representation within the World Bank is similar to that within the IMF.

Two potentially major international financial fora have been created since the start of stage III of EMU: the Financial Stability Forum (FSF) in April 1999 and the G20, in September 1999. Both were formed following the Asian financial crisis and aim to improve international financial stability. The Commission does not participate in either forum. The EU presidency is not represented in the FSF but is in the G20. The ECB, however, due to the continuity of its participation, exerts more influence in these fora. The international role of the ECB merits further discussion given that the Treaty basis of its international role is not explicit and given its involvement in fora whose agenda may expand into areas beyond monetary policy. EC representation is more explicit in the European Bank for Reconstruction and Development (EBRD) in so far as the Community, represented by the Commission, and the European Investment Bank are shareholders and members of the Board. EU Member States are also board members. As differences of opinion ma y exist between different representatives of the EC at the EBRD, presenting a common EC position may not always be straightforward.

The above situation is clearly highly confusing. Ultimately it is to be hoped that there would be a single EU seat in the IFIs. But the question is how to get there? There are those who argue for a gradual approach, placing the emphasis on improved co-ordination sur place in Washington. Others suggest that as the IMF agenda is increasingly dominated by issues concerning EU competence, the EU should play a more prominent role through the Ecofin chair. This would mean Ecofin discussing IMF issues at their regular meetings and adopting common positions. A further complicating issue is Britain’s self-exclusion from the euro zone. This may be overcome if and when Britain joins the euro but until then only piecemeal reform is likely. There may be some redistribution of IMF and World Bank constituencies, especially after EU enlargement, but this will be difficult to achieve as Member States would be reluctant to give up any seats to other groupings.

With regard to international institutions, the EU also has a mixed record in promoting its candidates. Although there is an informal understanding that a European should head the IMF, while the US claims top spot in the World Bank, the EU found it difficult to unite behind the first German candidate (Koch-Weser) proposed for the job in 2000. US opposition also played a role in the Germans withdrawing Koch- Weser and substituting Horst Kohler as the German/EU candidate. The US and other countries are also critical of the EU’s alleged over-representation in international bodies and some voices have been raised proposing that the EU’s representation be cut, particularly in light of an enlarged EU of 25 Member States.

Conclusion

The external representation of the EU is a complicated process. The CFSP has been in operation for a relatively short period of time, less than a decade. Mr CFSP has been in existence for an even shorter period, three years. The CFSP is a process, one which will take time to meet the lofty ideals in the treaty. But the initial years demonstrate that the CFSP, despite many setbacks, especially in the Balkans, is heading in the right direction. The EU is gradually increasing its profile in the world and more and more countries are looking to Brussels for a lead, if not assistance. It would be wrong to view the CFSP in isolation from the external relations of the Union as a whole. Over the range of its external affairs the Union has never been more united in its history than it is today.

Yet, there are clear challenges to more effective EC participation in international monetary and financial governance. Firstly, how to develop effective and coherent EC representation within bodies that were set up for a membership comprising only states. Representational issues also arise with regard to newer fora, even those created after the start of Stage III of EMU. Secondly, there are challenges for reaching common EC positions. A lack of clear arrangements for external representation has considerably hampered the ability of the Community to speak with one voice in various international fora. As a result the Community position is often much weaker than that of the US, in spite of its similar financial and economic weight with the result that the full benefits of the euro are not being realised.

The EU has also been invisible in international efforts to deal with the recurrent financial and banking crises caused by the sharp swings in capital flows to emerging markets. As there is no direct EU competence this issue has been left to Member States to deal with according to their own perceived national interests. No coherent EU position has ever been developed and defended, even in cases where Europe’s strategic interests are clear, e.g. Turkey. In contrast, the US usually has well defined positions and is highly effective at influencing multilateral bodies such as the IMF. Member States jealously guard their prerogatives in financial matters and this is the main reason why there is no EU institutional mechanism to coordinate positions within international financial institutions. This deprives the EU of crucial leverage.  

As Chris Patten has argued, a Union with 350 million citizens, the largest trading bloc in the world with a single currency, the largest provider of development aid and humanitarian assistance, cannot escape from playing a greater role in foreign and security policy. Given its weight, responsibility and global interests, the EU needs to strengthen significantly its international representation and ensure that it speaks with a single voice in international fora. This will not be an easy task.


The author, an official of the European Commission, writes here in a personal capacity

For more analyses see The European Policy Centre’s

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