The EU will ramp up efforts to counter China’s BRI

Significance Member states have asked the European Commission to spend the next nine months developing a plan containing “high impact and visible projects” to rival the BRI. While EU efforts to counter the BRI are not new, the political will has never been as strong as it is now. Impacts China will seek to make the BRI more attractive, such as by launching more initiatives to tackle climate change. Europe will remain distant from the US position on China, unless Germany gets a Green chancellor or Macron loses the 2022 election. The deterioration of the EU's relations with Hungary and Poland over rule-of-law issues could push those countries closer to China.

Subject The non-appearance of an expected EU anti-corruption report. Significance The European Commission’s cancellation of its second report on anti-corruption efforts across member-states and EU institutions removes a key benchmark against which to hold European governments to account at a time when several are attempting to roll back anti-corruption reforms and disable checks and balances. Given the political sensitivity of the first report, the move also feeds populist criticisms that the EU itself is prone to corruption and unwilling to expose itself to scrutiny. Impacts Populist governments appear to be learning from one another that they can remove limits on their power. This will allow interest groups to entrench their political and economic dominance, hindering economic growth in the long run. The US president’s attacks on parts of the media for ‘fake news’ may encourage use of anti-establishment rhetoric to discredit critics.


Significance The EP vote could in theory lead to sanctions under Article 7 of the EU Treaty (TEU). An 'illiberal state' has emerged in Hungary since 2010, profoundly and durably modifying the functioning of the political system, entrenching the power of the ruling Fidesz party and weakening the opposition. Impacts Fidesz will renew its strong majority in the 2018 elections and further consolidate its power in years to come. Member states are unlikely to agree on the deep reform of EU rule of law procedures that would allow a systematic response. Neighbouring states and candidate countries are likely to drift increasingly away from the liberal model.


Subject European Commission concerns about the rule of law in Poland. Significance The Commission has sent a formal Opinion to the Polish government, activating the first stage in the EU's 'Rule of Law Framework'. It expresses concerns about respect for the rule of law in Poland (a fundamental founding value of the EU), and in particular about the Polish government's handling of the crisis over the Constitutional Tribunal (TK, for Trybunał Konstytucyjny) Impacts Poland's EU position is likely to suffer as a result of the dispute, making it more difficult for it to achieve other political goals. Polish politics will remain unsettled and polarised, with the opposition using the Commission's Opinion to challenge the government. Legal uncertainty may translate into lower investment by individuals and enterprises dampening economic growth in the medium-to-long term.


Subject The prospects for finalising TTIP. Significance While the EU as a whole -- the European Commission, most member states and a majority of members of the European Parliament (EP) -- appears to remain committed to a wide-ranging agreement with the United States, there are growing indications that public opposition may render the proposed Transatlantic Trade and Investment Partnership (TTIP) agreement politically unviable. Impacts TTIP is estimated to raise the EU's GDP by 0.5%. European governments may decide that such a modest growth boost is not worth the political problems generated by the negotiations. If implemented, its terms could serve as a blueprint for future trade agreements between the EU and other countries. The deal's prospects will be diminished by the US election cycle's appeals to protectionist sentiment.


Subject Polish/EU frictions. Significance The European Commission has taken the unprecedented step of warning of a "clear risk" of a serious breach of the rule of law in Poland. Many in Brussels and Poland hoped that the appointment of a young prime minister and a major cabinet reshuffle signalled a rapprochement. On early evidence, at least, they may be sorely disappointed. Impacts Poland’s position in the EU will become more constrained as the rule-of-law conflict is exploited in negotiations on unrelated issues. In openly censuring Poland, the EU sees an opportunity to prove its credentials as a bulwark against populism and extremism. If Poland is pushed too far, the EU’s actions may undesirably strengthen anti-EU sentiments in one of its largest member states.


Significance Having tabled a relatively ambitious offer for COP21, the EU is seeking to recover its leading role in tackling climate change at the global level. Impacts The undemanding circumstances in which the EU achieved its 2020 targets will limit the political capital it might generate from doing so. The COP21 deal will shape France's international standing, in a field other than France's traditional military and security activities. If Poland obstructs strong EU post-COP21 climate change policies, it will further aggravate internal East-West relations. Energy policy could be contentious as early as the December 17 summit, as the EU takes first stock of COP21 while considering Nord Stream 2.


Significance The EU treaty’s Article 7 may be invoked in response to concerns about the state of democracy, fundamental rights and the rule of law in a member state. Yesterday's decision by the European Commission is the first time the procedure has been used. It may next be used against Hungary. However, the power of Poland and Hungary to veto it shows the lack of instruments to enforce common values. Impacts The EU’s inability to rein in non-compliant members may encourage reneging on democratic commitments elsewhere in CEE. Continued EU values breaches will jeopardise the EU’s coherence in talks with Serbia and Turkey. Values conflicts with Hungary and Poland threaten cohesion within the EU, increasing Russia’s strategic wriggle room.


Management ◽  
2014 ◽  
Vol 18 (1) ◽  
pp. 473-487
Author(s):  
Andrzej Czyżewski ◽  
Sebastian Stępień

Summary The objective of the paper is to present the results of negotiations on the EU budget for 2014-2020, with particular emphasis on the Common Agricultural Policy. Authors indicate the steps for establishing the budget, from the proposal of the European Commission presented in 2011, ending with the draft of UE budget agreed at the meeting of the European Council on February 2013 and the meeting of the AGRIFISH on March 2013 and then approved by the political agreement of the European Commission, European Parliament and European Council on June 2013. In this context, there will be an assessment of the new budget from the point of view of Polish economy and agriculture.


Significance The proposals identified areas where the euro could potentially become more dominant, such as the issuance of green bonds, digital currencies, and international trade in raw materials and energy. Ambitions to enhance the international leverage of the euro are being driven by the aim to strengthen EU strategic autonomy amid rising geopolitical risks. Impacts Developing its digital finance sector would be an opportunity for the EU to enhance its strategic autonomy in financial services. Challenging the US dollar would require the euro-area to rebalance its economy away from foreign to domestic demand. Member state division will prevent the economic reconfiguration the euro-area needed to make the euro a truly global currency.


Author(s):  
Petr YAKOVLEV

The decision on Britain’s secession from the European Union, taken by the British Parliament and agreed by London and Brussels, divided the Union history into “before” and “after”. Not only will the remaining member states have to “digest” the political, commercial, economic and mental consequences of parting with one of the largest partners. They will also have to create a substantially new algorithm for the functioning of United Europe. On this path, the EU is confronted with many geopolitical and geo-economic challenges, which should be answered by the new leaders of the European Commission, European Council, and European Parliament.


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