by Katinka Barysch
Are the Doha trade talks finally dead? Following the failure of the latest ministerial meeting in Geneva on July 29th, there will be little appetite for another big push to resolve disputes over farm subsidies and manufacturing tariffs. But unless the 150-odd WTO members agree on the outline of a deal in 2008, the new US administration (and the new EU Commission) would pretty much start from scratch in 2009. A final deal could then take another five years or more. Perhaps it would be better to give up on Doha?
Europeans do not seem to care very much. They worry more about the impact of the global downturn on their mortgage, job and pension. Many EU governments have also appeared distinctly unenthusiastic about trade liberalisation lately. French President Sarkozy blamed the Irish No to the Lisbon treaty on the ‘overly liberal’ trade policies of Trade Commissioner Peter Mandelson. During the Geneva talks, eight other EU countries lined up behind France (including Italy, Greece, Poland and Hungary). They argued that Mandelson’s first responsibility was to protect European jobs and incomes – in particular in the farm sector – not to finish a round of trade talks of dubious economic value.
Would the failure of Doha be a disaster for Europe? Not on the face of it. Calculations of the direct economic benefits from finishing the round have gradually been reduced (and most estimates are now well below 1 per cent of global GDP). With many of its biggest trading partners – China, Russia, ASEAN, the EFTA countries – the EU has special agreements on trade and investment, or is in the process of negotiating them (albeit with limited success). And many poorer countries may be more willing to grant the EU better access to their markets on a bilateral basis – without having to extend the same privileges to China.
So should the EU just let Doha die? Is reviving the round worth the risk of internal EU divisions and grumpy European farmers? Yes, because the costs of its failure could be huge. Here are just four of the issues to take into account.
* While Sarkozy and Berlusconi are wrong to claim that Mandelson is ‘selling out’ European farmers, the EU’s offer on agriculture is not negligible. It includes a complete abolition of export subsidies and a considerable reduction in both domestic farm support and import tariffs. Many development experts say the offer does not go far enough. But at least it would lock in some progress on CAP reform. That matters since the EU is conducting its own ‘health check’ on the CAP this year. And the issue of farm-sector reform will come up again by 2012, when EU countries will haggle about the EU’s new long-term budget. Accelerated CAP reform would free up billions of euros that would be better spent on innovation, climate protection or development. To keep CAP reform going is particularly important now that some EU politicians use the global food crisis as a phoney argument for more, not less, farm support.
* It is true that Doha would not result in drastic new tariff cuts for manufactured goods. But business in Europe and elsewhere is wrong to conclude that the current trade round doesn’t matter for them. As Patrick Messerlin, a French trade economist, has convincingly argued, the Doha round is hugely important for locking in the progress that has been made over the last 15 years. Most countries around the world now apply tariffs that are much lower than the ceilings fixed in the Uruguay round in 1993 (so-called bound tariffs). They could push them up to their bound levels without penalty at any time. Some emerging markets, such as Brazil, have already responded to slowing growth by nudging up their tariff protection. Binding manufacturing tariffs nearer their currently applied levels would reduce that risk, and give companies the certainty that they need to trade and invest abroad.
* If Doha fails, the WTO could lose much of its credibility, and the trend towards bilateral and regional trade agreements would accelerate further (200 of those are already in place, another 200 are being negotiated or planned). Economists disagree over whether this bilateralism is a good thing (a push for market opening while global talks remain stuck) or a bad thing (leading to a dangerous and costly fragmentation of the international economy). It certainly weakens the multilateral trading system. With only half of all Americans now believing that international trade is good for them, protectionist sentiment rising in Europe, and many emerging economies becoming more assertive in their trade policy, the world needs stronger global trade rules and dispute settlement mechanisms, not weaker ones.
* Finally, as Charles Grant and I have argued in our recent report ‘Can Europe and China shape a new world order?’, this is a critical time for persuading emerging powers that multilateralism actually works for them. They should work through international rules and organisations, not follow narrow-minded power politics. The WTO (and its predecessor, the GATT) is one of the cornerstones of the post-war multilateral system and the one that arguably matters most for China, India, Brazil and other rising economies. If the WTO does not deliver, how can we persuade these countries that the UN, the World Bank or the Kyoto regime on climate change matter for them?
Katinka Barysch is deputy director of the Centre for European Reform.
Wednesday, July 30, 2008
Friday, July 25, 2008
The EU will want more from Serbia than arrests
by Tomas Valasek
On July 21st, Serbian security agents hauled Radovan Karadzic off a bus in Belgrade and took him into custody. The long-wanted wartime leader of the Bosnian Serbs now awaits extradition to the International War Crimes Tribunal (ICTY) in The Hague, where he stands accused of crimes against humanity for his role in the 1992-95 Bosnia war. My conversations with analysts, journalists and diplomats in Belgrade this week suggest that his arrest could signal the beginning of Serbia’s full reconciliation with its role in the Yugoslav wars. It also opens the door to improved relations with the EU. However, Serbia’s application for EU membership will remain on hold until Belgrade and Brussels can agree on a better way of co-operating over Kosovo.
Karadzic had been hiding in Serbia for much of his 13-year run from the law. There are two schools of thought among local and Western observers in Belgrade on why the Serbian security forces moved to arrest Karadzic. Both assume that Serbia has known for a while that Karadzic had been hiding on its territory, rather than in Bosnia, where he committed his crimes. And both acknowledge that Serbia’s co-operation with the Hague Tribunal has been half-hearted of late.
Belgrade did arrest some accused war criminals, most notably Serbia’s former leader, Slobodan Milosevic. But shortly after Milosevic’s arrest – and largely because of it – elements in the security forces assassinated the then-prime minister Zoran Djindjic. Subsequent governments have been far more cautious. Belgrade would occasionally arrest smaller fish, usually right before important EU summits. This allowed Serbian governments to claim compliance with The Hague’s demands, without really dealing with Serbia’s role in the Yugoslav wars. All along, security forces loyal to the Milosevic regime were allowed to protect the most wanted criminals, like Karadzic and General Ratko Mladic, the wartime commander of the Bosnian Serb military.
So when the news of Karadzic’s arrest broke, some in Belgrade and Brussels – the first school of thought – saw it as a half-hearted attempt to improve Serbia’s image and win kudos with the European Union, which Serbia would like to join as soon as possible. But this time, things may be different. The second school of thought, to which I subscribe, argues that domestic politics played a crucial role in the arrest.
Karadzic’s arrest comes shortly after Serbia voted in what is arguably the most pro-EU government since Djindjic’s assassination. All recent Serbian governments had combined openly pro-Western parties with more nationalist voices, and so does the current coalition. But in this government the roles have been reversed. President Boris Tadic’s party ousted the nationalist prime minister, Vojislav Kostunica, who had been seen in Belgrade as the main obstacle to arrests of Karadzic and Mladic. Pro-EU parties now dominate, and they have gained a tighter control over the security apparatus. Right after forming a government, Tadic removed the head of secret service, who had helped protect indicted war criminals. The arrest of Karadzic came just two days later. People close to Tadic believe that the other remaining ‘big fish’, like Ratko Mladic, will be arrested soon as well.
Tadic won the election on a platform of bringing Serbia into the EU and attracting Western investment, both of which should improve Serbs’ poor living standards. But the EU wanted (and still wants) to see more arrests of war criminals before it moves Serbia’s application forward. No arrests, no EU integration, no foreign investment, no economic recovery. So Tadic decided that there were strong domestic reasons to move forward on the war crimes issue. The arrest of Karadzic, Serbian analysts say, has also helped boost Tadic’s image – he had a reputation for vacillating but this bold step has made him look like a leader. And he seems to have rightly calculated that the Serbian public would support him. There were precious few demonstrators in the streets of Belgrade after Karadzic’s arrest. This, in turn, made the nationalist opposition look out of touch.
On balance, Tadic’s pursuit of war criminals seems genuine. It strengthens his domestic political position, and it improves Serbia’s standing in the eyes of the EU. But Kosovo will continue to plague the Brussels-Belgrade relationship. Serbia is a candidate for EU membership, and it recently signed a new partnership agreement with the EU, the ‘stability and association agreement’, or SAA. But the EU has held up the agreement’s entry into force, in order to pressure Belgrade to apprehend war criminals. The EU also has a second reason for being reluctant to speed up Serbia’s integration process: it wants co-operation from Serbia on Kosovo. And there has been very little progress on the latter point.
Most EU states have recognised an independent Kosovo. But Serbia, even under its current government, remains categorically opposed. Instead, it has effectively divided Kosovo by taking administrative control of the country’s north where much of the population are ethnic Serbs. Belgrade now finances health workers and policemen serving local Serbs in Kosovo. It is also preventing the EU rule of law mission, EULEX, from fully deploying. Tadic has hinted at wanting to improve co-operation with the EU – for example, he is sending back Serbian ambassadors to those EU countries that have recognised Kosovo (Kostunica had recalled them). But more needs to be done; Serbia needs to allow the EU police to operate in all of Kosovo. Until then, its ties with the EU, even after Karadzic’s arrest, will remain strained.
Tomas Valasek is director of foreign policy and defence at the Centre for European Reform
On July 21st, Serbian security agents hauled Radovan Karadzic off a bus in Belgrade and took him into custody. The long-wanted wartime leader of the Bosnian Serbs now awaits extradition to the International War Crimes Tribunal (ICTY) in The Hague, where he stands accused of crimes against humanity for his role in the 1992-95 Bosnia war. My conversations with analysts, journalists and diplomats in Belgrade this week suggest that his arrest could signal the beginning of Serbia’s full reconciliation with its role in the Yugoslav wars. It also opens the door to improved relations with the EU. However, Serbia’s application for EU membership will remain on hold until Belgrade and Brussels can agree on a better way of co-operating over Kosovo.
Karadzic had been hiding in Serbia for much of his 13-year run from the law. There are two schools of thought among local and Western observers in Belgrade on why the Serbian security forces moved to arrest Karadzic. Both assume that Serbia has known for a while that Karadzic had been hiding on its territory, rather than in Bosnia, where he committed his crimes. And both acknowledge that Serbia’s co-operation with the Hague Tribunal has been half-hearted of late.
Belgrade did arrest some accused war criminals, most notably Serbia’s former leader, Slobodan Milosevic. But shortly after Milosevic’s arrest – and largely because of it – elements in the security forces assassinated the then-prime minister Zoran Djindjic. Subsequent governments have been far more cautious. Belgrade would occasionally arrest smaller fish, usually right before important EU summits. This allowed Serbian governments to claim compliance with The Hague’s demands, without really dealing with Serbia’s role in the Yugoslav wars. All along, security forces loyal to the Milosevic regime were allowed to protect the most wanted criminals, like Karadzic and General Ratko Mladic, the wartime commander of the Bosnian Serb military.
So when the news of Karadzic’s arrest broke, some in Belgrade and Brussels – the first school of thought – saw it as a half-hearted attempt to improve Serbia’s image and win kudos with the European Union, which Serbia would like to join as soon as possible. But this time, things may be different. The second school of thought, to which I subscribe, argues that domestic politics played a crucial role in the arrest.
Karadzic’s arrest comes shortly after Serbia voted in what is arguably the most pro-EU government since Djindjic’s assassination. All recent Serbian governments had combined openly pro-Western parties with more nationalist voices, and so does the current coalition. But in this government the roles have been reversed. President Boris Tadic’s party ousted the nationalist prime minister, Vojislav Kostunica, who had been seen in Belgrade as the main obstacle to arrests of Karadzic and Mladic. Pro-EU parties now dominate, and they have gained a tighter control over the security apparatus. Right after forming a government, Tadic removed the head of secret service, who had helped protect indicted war criminals. The arrest of Karadzic came just two days later. People close to Tadic believe that the other remaining ‘big fish’, like Ratko Mladic, will be arrested soon as well.
Tadic won the election on a platform of bringing Serbia into the EU and attracting Western investment, both of which should improve Serbs’ poor living standards. But the EU wanted (and still wants) to see more arrests of war criminals before it moves Serbia’s application forward. No arrests, no EU integration, no foreign investment, no economic recovery. So Tadic decided that there were strong domestic reasons to move forward on the war crimes issue. The arrest of Karadzic, Serbian analysts say, has also helped boost Tadic’s image – he had a reputation for vacillating but this bold step has made him look like a leader. And he seems to have rightly calculated that the Serbian public would support him. There were precious few demonstrators in the streets of Belgrade after Karadzic’s arrest. This, in turn, made the nationalist opposition look out of touch.
On balance, Tadic’s pursuit of war criminals seems genuine. It strengthens his domestic political position, and it improves Serbia’s standing in the eyes of the EU. But Kosovo will continue to plague the Brussels-Belgrade relationship. Serbia is a candidate for EU membership, and it recently signed a new partnership agreement with the EU, the ‘stability and association agreement’, or SAA. But the EU has held up the agreement’s entry into force, in order to pressure Belgrade to apprehend war criminals. The EU also has a second reason for being reluctant to speed up Serbia’s integration process: it wants co-operation from Serbia on Kosovo. And there has been very little progress on the latter point.
Most EU states have recognised an independent Kosovo. But Serbia, even under its current government, remains categorically opposed. Instead, it has effectively divided Kosovo by taking administrative control of the country’s north where much of the population are ethnic Serbs. Belgrade now finances health workers and policemen serving local Serbs in Kosovo. It is also preventing the EU rule of law mission, EULEX, from fully deploying. Tadic has hinted at wanting to improve co-operation with the EU – for example, he is sending back Serbian ambassadors to those EU countries that have recognised Kosovo (Kostunica had recalled them). But more needs to be done; Serbia needs to allow the EU police to operate in all of Kosovo. Until then, its ties with the EU, even after Karadzic’s arrest, will remain strained.
Tomas Valasek is director of foreign policy and defence at the Centre for European Reform
Tuesday, July 22, 2008
Ukraine needs new politicians
by Charles Grant
Ukraine is heading for an economic crash. At least that was the message I picked up in the Crimean resort of Yalta earlier this month, at the 'Yalta European Strategy' conference. The point of this annual event is to bring Ukraine closer to the European Union. At last year's conference Gerhard Schröder and Bill Clinton dropped in; this year, Tony Blair and Mikheil Saakashvili urged Ukraine's leaders to push ahead with reforms that would speed up European integration.
But Ukraine's politicians are not listening. The two parties in the governing coalition, President Viktor Yushchenko's Our Ukraine, and the Bloc Yulia Tymoshenko (BYuT), are at daggers drawn with each other. The presidential election due in 2009 dominates politics. Yushchenko fears a challenge from Tymoshenko, who is more popular than him, and each seems to be focused on damaging the image of the other. Meanwhile, the economy is on the brink of collapse but neither politician is prepared to take the unpopular measures that would be required to stabilise it.
The political system is deeply corrupt and there are virtually no neutral state institutions: the electoral commission and the supreme court are packed with party nominees. One of Ukraine's brighter and younger politicians, Rada speaker Arseniy Yatsenyuk, was blunt in Yalta: "Our problem is a lack of political maturity, we have no standards, we don't have a clear idea how to enforce laws or penalise people, we have no strong prosecutor's office, and the judicial system is deteriorating."
Meanwhile the economy, which had picked up in the past few years, with growth of 7 per cent in 2007, faces huge problems. Inflation, at 30 per cent, is the third highest in the world, after Zimbabwe and Venezuela. The government is boosting transfer payments and public sector wages in an effort to buy political support. The trade deficit is running at 12 per cent of GDP. The government has foolishly tied the hryvnia to the dollar, which encourages hot money to flow in and fuel inflation. Ukraine's industries – predominantly metals, chemicals and food processing – are losing competitiveness. Another problem is that Ukraine is locked into one of its regular rows with Russia over the price of gas imports. If, as is likely, Ukraine ends up having to pay a significantly higher price, its gas-dependent heavy industries will suffer.
The question of NATO membership is exacerbating divisions among the political elite. The opposition Regions party, led by Viktor Yanukovich, is strongly against, while Our Ukraine is strongly for. BYuT would in theory like to join NATO in the long term, but does not want to push this for now on the grounds that it would divide the country.
In Yalta, Sergei Glaziev, a senior Russian economist and a former minister, described how Russia would react if Ukraine entered NATO: "Ukraine would lose its free trade area with Russia, we would raise gas prices, Russian companies would cut off co-operation with Ukrainian ones on high technology, and we would impose visa restrictions." That was quite moderate. Last month, at a conference in Moscow, I heard foreign minister Sergei Lavrov say that if Ukraine joined NATO, some Russians would question Ukraine's borders. Yuri Luzhkov, the mayor of Moscow, has explained what that means: Crimea should be chopped off Ukraine and given to Russia.
Such threats show that the Russians are failing to overcome their historic inability to make friends with their neighbours. Ukrainians do not like being bullied. As it happens, only about 20 per cent of them want to join NATO. But Russian threats tarnish the attractiveness of the big eastern neighbour, even in Ukraine's east, where people are naturally sympathetic to Russia. The Russians are wasting their energy when they threaten Ukraine, since there is no chance of it joining NATO in the foreseeable future. The pro-NATO Yushchenko is likely to be out of office in a couple of years, while France and Germany are determined to veto American efforts to give Ukraine a 'membership action plan.'
The question of the EU membership, by contrast, generally unites Ukrainians: easterners and westerners all want to join (Russia does not mind Ukraine joining the EU). The EU and Ukraine are negotiating a 'deep free trade' agreement, meaning one that would remove non-tariff as well as tariff barriers, and foster regulatory convergence. But many Ukrainians worry about the cost of implementing such an agreement. In order to comply with EU standards and therefore be able to export to EU markets, Ukraine would need to spend billions of dollars, say government officials. Yet EU aid to Ukraine totals only €200 million a year. Furthermore, some of Ukraine's oligarchs may resist free trade with the EU; they fear that outside competition could disrupt their cosy cartels.
Given that the EU is not offering Ukraine the carrot of a membership perspective, the political and business elites may be reluctant to embrace the – sometimes painful – reforms that would bring Ukraine closer to the Union. To his credit, France's President Nicolas Sarkozy is trying to get the EU to offer closer political links. Ukraine's deputy prime minister in charge of EU integration, Hrihoriy Nemyria, spelt out in Yalta what Ukraine wanted: "The long term goal of visa-free travel, money from the European Investment Bank, and integration into all EU agencies and programmes."
Fine ideas. But if Ukraine’s political class continues to perform abysmally, and if the economy crashes, there is little chance of the EU wanting to embrace Ukraine. Yatsenyuk told the truth in Yalta: "We're not ready for EU, we should wait five years before we try to get in. In five years there will be a new political elite in charge in Ukraine." Let us hope he is right on that last point.
Charles Grant is Director of the Centre for European Reform
Ukraine is heading for an economic crash. At least that was the message I picked up in the Crimean resort of Yalta earlier this month, at the 'Yalta European Strategy' conference. The point of this annual event is to bring Ukraine closer to the European Union. At last year's conference Gerhard Schröder and Bill Clinton dropped in; this year, Tony Blair and Mikheil Saakashvili urged Ukraine's leaders to push ahead with reforms that would speed up European integration.
But Ukraine's politicians are not listening. The two parties in the governing coalition, President Viktor Yushchenko's Our Ukraine, and the Bloc Yulia Tymoshenko (BYuT), are at daggers drawn with each other. The presidential election due in 2009 dominates politics. Yushchenko fears a challenge from Tymoshenko, who is more popular than him, and each seems to be focused on damaging the image of the other. Meanwhile, the economy is on the brink of collapse but neither politician is prepared to take the unpopular measures that would be required to stabilise it.
The political system is deeply corrupt and there are virtually no neutral state institutions: the electoral commission and the supreme court are packed with party nominees. One of Ukraine's brighter and younger politicians, Rada speaker Arseniy Yatsenyuk, was blunt in Yalta: "Our problem is a lack of political maturity, we have no standards, we don't have a clear idea how to enforce laws or penalise people, we have no strong prosecutor's office, and the judicial system is deteriorating."
Meanwhile the economy, which had picked up in the past few years, with growth of 7 per cent in 2007, faces huge problems. Inflation, at 30 per cent, is the third highest in the world, after Zimbabwe and Venezuela. The government is boosting transfer payments and public sector wages in an effort to buy political support. The trade deficit is running at 12 per cent of GDP. The government has foolishly tied the hryvnia to the dollar, which encourages hot money to flow in and fuel inflation. Ukraine's industries – predominantly metals, chemicals and food processing – are losing competitiveness. Another problem is that Ukraine is locked into one of its regular rows with Russia over the price of gas imports. If, as is likely, Ukraine ends up having to pay a significantly higher price, its gas-dependent heavy industries will suffer.
The question of NATO membership is exacerbating divisions among the political elite. The opposition Regions party, led by Viktor Yanukovich, is strongly against, while Our Ukraine is strongly for. BYuT would in theory like to join NATO in the long term, but does not want to push this for now on the grounds that it would divide the country.
In Yalta, Sergei Glaziev, a senior Russian economist and a former minister, described how Russia would react if Ukraine entered NATO: "Ukraine would lose its free trade area with Russia, we would raise gas prices, Russian companies would cut off co-operation with Ukrainian ones on high technology, and we would impose visa restrictions." That was quite moderate. Last month, at a conference in Moscow, I heard foreign minister Sergei Lavrov say that if Ukraine joined NATO, some Russians would question Ukraine's borders. Yuri Luzhkov, the mayor of Moscow, has explained what that means: Crimea should be chopped off Ukraine and given to Russia.
Such threats show that the Russians are failing to overcome their historic inability to make friends with their neighbours. Ukrainians do not like being bullied. As it happens, only about 20 per cent of them want to join NATO. But Russian threats tarnish the attractiveness of the big eastern neighbour, even in Ukraine's east, where people are naturally sympathetic to Russia. The Russians are wasting their energy when they threaten Ukraine, since there is no chance of it joining NATO in the foreseeable future. The pro-NATO Yushchenko is likely to be out of office in a couple of years, while France and Germany are determined to veto American efforts to give Ukraine a 'membership action plan.'
The question of the EU membership, by contrast, generally unites Ukrainians: easterners and westerners all want to join (Russia does not mind Ukraine joining the EU). The EU and Ukraine are negotiating a 'deep free trade' agreement, meaning one that would remove non-tariff as well as tariff barriers, and foster regulatory convergence. But many Ukrainians worry about the cost of implementing such an agreement. In order to comply with EU standards and therefore be able to export to EU markets, Ukraine would need to spend billions of dollars, say government officials. Yet EU aid to Ukraine totals only €200 million a year. Furthermore, some of Ukraine's oligarchs may resist free trade with the EU; they fear that outside competition could disrupt their cosy cartels.
Given that the EU is not offering Ukraine the carrot of a membership perspective, the political and business elites may be reluctant to embrace the – sometimes painful – reforms that would bring Ukraine closer to the Union. To his credit, France's President Nicolas Sarkozy is trying to get the EU to offer closer political links. Ukraine's deputy prime minister in charge of EU integration, Hrihoriy Nemyria, spelt out in Yalta what Ukraine wanted: "The long term goal of visa-free travel, money from the European Investment Bank, and integration into all EU agencies and programmes."
Fine ideas. But if Ukraine’s political class continues to perform abysmally, and if the economy crashes, there is little chance of the EU wanting to embrace Ukraine. Yatsenyuk told the truth in Yalta: "We're not ready for EU, we should wait five years before we try to get in. In five years there will be a new political elite in charge in Ukraine." Let us hope he is right on that last point.
Charles Grant is Director of the Centre for European Reform
Wednesday, July 16, 2008
The latest Euro-Med jamboree
By Clara Marina O'Donnell
On July 13th, President Sarkozy, surrounded by 42 EU and Mediterranean leaders, launched his pet project, the Union for the Mediterranean. The Paris summit was a success. The turnout was impressive and the mood constructive. Israel declared that peace with the Palestinians was closer than ever, while Syria and Lebanon announced they will open embassies in their respective countries. But many of the positive steps are the result of peace efforts unrelated to the new Union. And it doesn’t look like the French initiative addresses the obstacles that have limited the success of past EU policies in the region.
Because of its proximity, the stability and prosperity of the Mediterranean is of crucial importance to the EU. For many years, the EU has been working with the region, trying to replicate the soft power approach which proved so successful in Eastern Europe – it has encouraged regional cooperation and domestic reforms in exchange for deeper relations with the EU. In 1995, at a summit as ambitious as Sarkozy’s recent jamboree, the EU launched the so-called Barcelona Process – a multilateral framework designed to encourage peace, democracy and economic development through regional integration. In 2004, to the confusion of many Mediterranean partners, the EU introduced an additional policy, the European Neighbourhood Policy (ENP), designed to deepen bilateral cooperation between the EU and the Mediterranean partners, and to give an additional impetus to reform.
The Barcelona Process has created the only regional forum with Arab and Israeli participants. But Barcelona and the ENP have failed to fulfil expectations. Democratic reforms and economic development have not materialised, and the various conflicts remain unresolved.
Two main challenges have hampered EU efforts in the Mediterranean. First, the benefits that the EU can offer Mediterranean governments are limited, so the EU has little leverage to encourage reforms. The EU’s most effective incentive, membership, is not on the cards, and with the exception of Morocco, most countries are not interested in joining in any case. EU leverage is further reduced by its reluctance to offer things which are attractive to the region’s governments, such as greater access to the EU’s labour market and free trade for agriculture.
Secondly the EU is trying to encourage cooperation across a region riddled with conflicts. The Arab-Israeli conflict is the most intractable dispute, but serious tensions also exist between Morocco and Algeria, and Cyprus, Turkey and Greece. The different tensions obstruct most efforts to cooperate and have seriously undermined the Barcelona Process.
The Union for the Mediterranean has the merit of putting the region at the top of the political agenda and giving badly needed impetus to Euro-Mediterranean relations. The Union aims to strengthen the Barcelona Process by focusing on projects of regional cooperation (such as cleaning up the Mediterranean and building motorways). But it risks getting stuck in the same quagmire as previous EU initiatives. Regional projects were already part of the Barcelona Process and are therefore unlikely to provide a breakthrough. In addition the Union doesn’t address either of the main challenges. There are no new incentives to encourage Mediterranean leaders to reform. The EU will not even provide additional funding for the new projects. And while the different Mediterranean partners might have seemed constructive at the recent summit, it is largely because several difficult questions were put off until November. Among other things there is still no agreement on how to staff the Union’s new independent secretariat (which in principle should have officials from all the countries involved). Many officials think it will be unfeasible to have Israelis and Syrians working side by side, and many Arab governments have made clear they do not want the Union to lead to a normalisation of relations with Israel.
New institutions are not the answer to the region’s problems. If the EU wants to have a bigger impact on the Mediterranean it must offer its partners some of the things they care about – greater financial assistance and freer trade in agricultural goods would be a good start. Even then, the EU should lower its expectations and acknowledge that it is dealing with partners who have a very different analysis of the costs and benefits of reform than Eastern Europe had.
The EU should also increase its diplomatic efforts towards the different conflicts across the region. It should build on the momentum of the Paris summit so that the following summits of the Union no longer merely benefit from steps towards peace but contribute to them as well.
Clara Marina O'Donnell is a research fellow at the Centre for European Reform
On July 13th, President Sarkozy, surrounded by 42 EU and Mediterranean leaders, launched his pet project, the Union for the Mediterranean. The Paris summit was a success. The turnout was impressive and the mood constructive. Israel declared that peace with the Palestinians was closer than ever, while Syria and Lebanon announced they will open embassies in their respective countries. But many of the positive steps are the result of peace efforts unrelated to the new Union. And it doesn’t look like the French initiative addresses the obstacles that have limited the success of past EU policies in the region.
Because of its proximity, the stability and prosperity of the Mediterranean is of crucial importance to the EU. For many years, the EU has been working with the region, trying to replicate the soft power approach which proved so successful in Eastern Europe – it has encouraged regional cooperation and domestic reforms in exchange for deeper relations with the EU. In 1995, at a summit as ambitious as Sarkozy’s recent jamboree, the EU launched the so-called Barcelona Process – a multilateral framework designed to encourage peace, democracy and economic development through regional integration. In 2004, to the confusion of many Mediterranean partners, the EU introduced an additional policy, the European Neighbourhood Policy (ENP), designed to deepen bilateral cooperation between the EU and the Mediterranean partners, and to give an additional impetus to reform.
The Barcelona Process has created the only regional forum with Arab and Israeli participants. But Barcelona and the ENP have failed to fulfil expectations. Democratic reforms and economic development have not materialised, and the various conflicts remain unresolved.
Two main challenges have hampered EU efforts in the Mediterranean. First, the benefits that the EU can offer Mediterranean governments are limited, so the EU has little leverage to encourage reforms. The EU’s most effective incentive, membership, is not on the cards, and with the exception of Morocco, most countries are not interested in joining in any case. EU leverage is further reduced by its reluctance to offer things which are attractive to the region’s governments, such as greater access to the EU’s labour market and free trade for agriculture.
Secondly the EU is trying to encourage cooperation across a region riddled with conflicts. The Arab-Israeli conflict is the most intractable dispute, but serious tensions also exist between Morocco and Algeria, and Cyprus, Turkey and Greece. The different tensions obstruct most efforts to cooperate and have seriously undermined the Barcelona Process.
The Union for the Mediterranean has the merit of putting the region at the top of the political agenda and giving badly needed impetus to Euro-Mediterranean relations. The Union aims to strengthen the Barcelona Process by focusing on projects of regional cooperation (such as cleaning up the Mediterranean and building motorways). But it risks getting stuck in the same quagmire as previous EU initiatives. Regional projects were already part of the Barcelona Process and are therefore unlikely to provide a breakthrough. In addition the Union doesn’t address either of the main challenges. There are no new incentives to encourage Mediterranean leaders to reform. The EU will not even provide additional funding for the new projects. And while the different Mediterranean partners might have seemed constructive at the recent summit, it is largely because several difficult questions were put off until November. Among other things there is still no agreement on how to staff the Union’s new independent secretariat (which in principle should have officials from all the countries involved). Many officials think it will be unfeasible to have Israelis and Syrians working side by side, and many Arab governments have made clear they do not want the Union to lead to a normalisation of relations with Israel.
New institutions are not the answer to the region’s problems. If the EU wants to have a bigger impact on the Mediterranean it must offer its partners some of the things they care about – greater financial assistance and freer trade in agricultural goods would be a good start. Even then, the EU should lower its expectations and acknowledge that it is dealing with partners who have a very different analysis of the costs and benefits of reform than Eastern Europe had.
The EU should also increase its diplomatic efforts towards the different conflicts across the region. It should build on the momentum of the Paris summit so that the following summits of the Union no longer merely benefit from steps towards peace but contribute to them as well.
Clara Marina O'Donnell is a research fellow at the Centre for European Reform
Friday, July 04, 2008
Russia and the multipolar myth
by Bobo Lo
I attended a curious conference the other week in Moscow. It was a posh event with a stellar cast and the grand, even pompous, title of ‘Forging common futures in a multipolar world’. The event turned out to be not so much a conference as a celebration of multipolarity, served with a generous helping of schadenfreude at America’s recent troubles.
There have been a number of such gatherings lately, voicing various fashionable mantras. It has become axiomatic that ‘power has shifted decisively from the west to the east’, that ‘a new world order is emerging’, and that ‘the world has become multipolar’. It would seem that the decline of the West has finally occurred, some 90 years after Oswald Spengler first predicted it in the aftermath of the First World War.
In reality, much of the multipolar bombast is humbug – as even its advocates tacitly recognize. The star turn of the Moscow conference was an address by Russian foreign minister Sergei Lavrov. In it, he emphasized the importance of a new international architecture and condemned the rigidity of ‘the Anglo-Saxon model’. However, instead of talking up the global multipolar order, as one might have expected, Lavrov gave pride of place to the notion of a common European Christian civilization. There was barely any reference to multipolarity, while China and India were only mentioned in the context of the most fleeting nod to the BRICs concept.
Lavrov’s nakedly Eurocentric focus did not escape notice. One senior Indian participant remarked tartly that Russia was exploiting the concept of multipolarity to maximize its position, status and influence in the world. The Chinese present in the room simply dismissed the possibility that Russia’s world view might be anything other than Western-oriented.
These observers were merely underlining the obvious – that the importance of multipolarity to Moscow is almost entirely instrumental. True, the ‘unipolar moment’ – if it ever existed – has long gone. The United States has lost much of its international authority under the Bush administration, and the West as a whole has experienced a relative decline in the world. The European Union, so effective as an economic body, continues to be a negligible political player, undermined by the pursuit of selfish national interests. And China is beginning to make its presence felt in global affairs. There is no doubt that the contemporary international environment is more disparate, more fluid, and more equal than at any time since the Second World War.
However, the ‘multipolar world order’ is a distant prospect. The United States, for all its difficulties, remains the sole superpower and will continue to be so for at least two decades. By any criterion – military power, political authority, economic prosperity, technological advancement, cultural and normative influence – America stands far above the other great powers. China, the putative heir-apparent, recognizes this, and not merely because it wishes to allay fears about its own ‘peaceful rise’. Beijing understands better than many so-called experts in the West the extent of Chinese weakness at home and abroad. Its insistence that China remains a ‘developing country’ rather than a world power reflects reality, not false modesty.
In the meantime, the multipolar polemic holds diminishing appeal, even in Moscow. The problem with being an ‘independent’ pole is that this can easily slip into self-isolation, particularly when the other major players do not really believe in a new world order. So Moscow has shifted to emphasizing ideas of community and shared European values and traditions. At the latest Russia-EU summit in the Siberian oil town of Khanty-Mansiisk, President Dmitry Medvedev expanded on Lavrov’s themes by returning to Gorbachev’s vision of a ‘common European home’.
Ultimately, Russia does not want to leave the West so much as to redefine it. The ‘new West’, as envisaged in Moscow, would not be dominated by the United States (abetted by the United Kingdom), but by the major continental European powers – Germany, France and Russia. It would represent a reversion from the EU’s post-modern conception of a rules-based and institutionalised Europe towards a more traditional understanding of a common European history, religion and culture. Most importantly, it would give Russia a secure niche in the ‘civilized’ international community: a sense of belonging to a larger whole, but without irksome constraints on its strategic flexibility.
Bobo Lo is director of the Russia and China programmes at the Centre for European Reform.
I attended a curious conference the other week in Moscow. It was a posh event with a stellar cast and the grand, even pompous, title of ‘Forging common futures in a multipolar world’. The event turned out to be not so much a conference as a celebration of multipolarity, served with a generous helping of schadenfreude at America’s recent troubles.
There have been a number of such gatherings lately, voicing various fashionable mantras. It has become axiomatic that ‘power has shifted decisively from the west to the east’, that ‘a new world order is emerging’, and that ‘the world has become multipolar’. It would seem that the decline of the West has finally occurred, some 90 years after Oswald Spengler first predicted it in the aftermath of the First World War.
In reality, much of the multipolar bombast is humbug – as even its advocates tacitly recognize. The star turn of the Moscow conference was an address by Russian foreign minister Sergei Lavrov. In it, he emphasized the importance of a new international architecture and condemned the rigidity of ‘the Anglo-Saxon model’. However, instead of talking up the global multipolar order, as one might have expected, Lavrov gave pride of place to the notion of a common European Christian civilization. There was barely any reference to multipolarity, while China and India were only mentioned in the context of the most fleeting nod to the BRICs concept.
Lavrov’s nakedly Eurocentric focus did not escape notice. One senior Indian participant remarked tartly that Russia was exploiting the concept of multipolarity to maximize its position, status and influence in the world. The Chinese present in the room simply dismissed the possibility that Russia’s world view might be anything other than Western-oriented.
These observers were merely underlining the obvious – that the importance of multipolarity to Moscow is almost entirely instrumental. True, the ‘unipolar moment’ – if it ever existed – has long gone. The United States has lost much of its international authority under the Bush administration, and the West as a whole has experienced a relative decline in the world. The European Union, so effective as an economic body, continues to be a negligible political player, undermined by the pursuit of selfish national interests. And China is beginning to make its presence felt in global affairs. There is no doubt that the contemporary international environment is more disparate, more fluid, and more equal than at any time since the Second World War.
However, the ‘multipolar world order’ is a distant prospect. The United States, for all its difficulties, remains the sole superpower and will continue to be so for at least two decades. By any criterion – military power, political authority, economic prosperity, technological advancement, cultural and normative influence – America stands far above the other great powers. China, the putative heir-apparent, recognizes this, and not merely because it wishes to allay fears about its own ‘peaceful rise’. Beijing understands better than many so-called experts in the West the extent of Chinese weakness at home and abroad. Its insistence that China remains a ‘developing country’ rather than a world power reflects reality, not false modesty.
In the meantime, the multipolar polemic holds diminishing appeal, even in Moscow. The problem with being an ‘independent’ pole is that this can easily slip into self-isolation, particularly when the other major players do not really believe in a new world order. So Moscow has shifted to emphasizing ideas of community and shared European values and traditions. At the latest Russia-EU summit in the Siberian oil town of Khanty-Mansiisk, President Dmitry Medvedev expanded on Lavrov’s themes by returning to Gorbachev’s vision of a ‘common European home’.
Ultimately, Russia does not want to leave the West so much as to redefine it. The ‘new West’, as envisaged in Moscow, would not be dominated by the United States (abetted by the United Kingdom), but by the major continental European powers – Germany, France and Russia. It would represent a reversion from the EU’s post-modern conception of a rules-based and institutionalised Europe towards a more traditional understanding of a common European history, religion and culture. Most importantly, it would give Russia a secure niche in the ‘civilized’ international community: a sense of belonging to a larger whole, but without irksome constraints on its strategic flexibility.
Bobo Lo is director of the Russia and China programmes at the Centre for European Reform.
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