On July, 1st, Germany took over the Presidency of the Council of the European Union until the end of 2020. What an exciting time to be in this position, the neutral observer might be tempted to assume, not mistakenly so. The coronavirus pandemic needs to be tackled in a common European effort, the Multiannual Financial Framework (MFF) needs to be agreed on rather urgently and not to be forgotten, the UK will have officially left the European Union, with or without a deal. The German government’s program appears to be aiming high at first. But what’s actually behind it? Does Germany identify the major challenges and their implications and what’s the plan to resolve them? This article looks at European Foreign Affairs, focusing firstly on the finance of foreign affairs, secondly on a cohesive foreign policy and lastly on foreign trade relations. The conclusion: It’s all about sovereignty, the question is for whom?
Financial Sovereignty in the MFF: At the core of Member States’ interests
If you’d ask most people about the hardest negotiation of their career, it will very likely be about money. Similarly, the MFF in combination with the recovery fund can fairly be considered a particularly contested part of Germany’s council presidency. Given the current tension between Greece and Turkey, the protests in Minsk or the poisoning of Alexej Navalny, it will likely not be remembered as the hardest challenge during Chancellor Merkel’s second term in this capacity. However, reminiscing about the efforts made since the Commission published the first draft in 2018 and all the unsuccessful summits so far, it was far from being an easy ride.
Even more surprising is that state leaders managed to find a fairly disputed consent after bridging the gap between the “frugal four” (Austria, Denmark, Netherlands, Sweden, Finland) and the rest of the EU member states and agreed on common European debt for the first time in history. If this is to be interpreted as European sovereignty shall be subject to discussion. Specifically interesting in line with this article is the financing of the EU’s Security and Defence policy, as the foreign policy section in the new MFF proposal remains quite vague and unspecific.
European Commission’s proposal for the MFF in 2018
Source: German Federal Ministry of Finance
The Commission’s proposal in 2018 suggested an overall investment of roughly 27,5 billion euros in security and defence with the highest contributions to the European Defence Fund (EDF) and the Connecting Europe Facility. This changed majorly during the council meeting in July. Now, the member states managed to agree on 13 billion euros, with the biggest cuts on the EDF (13 billion to 7 billion) and the Connecting Europe Facility (6,5 billion to 1,5 billion). The official program for the presidency is quite vague when it comes to specifics about the MFF, only specifying that “one of our major priorities will be to work to ensure a rapid conclusion of the negotiations on the EU’s multiannual financial framework (MFF) for the period from 2021 to 2027. The EU budget must, on the one hand, be geared to the current challenges in connection with the COVID-19 crisis and, on the other, to the European Union’s long-term strategic goals in a changing world.” This can hardly be surprising, knowing how difficult the negotiations have been so far. The more details the German government mentioned in its program concerning the MFF, the harder chancellor Merkel’s and Charles Michel’s jobs would have been.
Neither surprising is the outcome. Common European initiatives in the fields of security and defence policy have never been easy. The implementation of the Common Foreign and Security Policy (CFSP) and subsequently Common Security and Defence Policy (CSDP) after Maastricht has been a major change. However, both policy domains still remain highly intergovernmental. As policymakers have realised that this instance will be hard to change in the near future, the strategy seems to have changed, shifting the focus rather on research, development and procurement with the Permanent Structured Cooperation (PESCO), the Coordinated Annual Review on Defence (CARD) and now the EDF.
“Despite the cuts in the defence fund in light of the recovery fund, it remains obvious whom the sovereignty belongs to.”
This way, member states were able to establish the first steps toward a common European security and defence architecture without having to accept supranational delegation. Sovereignty remains with them as they congruently increase their own defence spendings as well and save money at the same time by working jointly on EU defence initiatives. This dynamic hasn’t been altered by the new MFF, it has rather been reinforced. The EDF aims at improving R&D in addition to national defence spendings rather than replacing them and is, thus, at the core of member states’ interests. Progress in European security and defence cooperation throughout the past years has only been possible when contributing to the national interests of the member states. This is again manifested in the new MFF proposal. Despite the cuts in the defence fund in light of the recovery fund, it remains obvious whom the sovereignty belongs to.
A cohesive foreign policy: serious efforts or just pretending?
For many years now there have been efforts to find a more cohesive position of the member states regarding their foreign and security policy. Previous initiatives have failed due to the member states’ refusal to give up sovereignty in this certainly very important policy field. Germany has, nevertheless, stressed the willingness to push for further progress in this field during its presidency. It is stated in the agenda that: “During its Presidency, Germany will support the High Representative, putting itself at the service of a united, responsible and powerful European external action policy.” The half-year time span will, obviously, not be enough to obtain major achievements on this front. But not only the limited time frame prevents Germany from pushing the boundaries in foreign and security policy. Also, the missing plan for substantial change shows that there will be no progress under the German presidency. Despite the promising acclamation cited above, the presidency program does not give any information on how to achieve this goal. Nor the discussion about restructuring the European External Action Service was continued even if no alteration of contract would be necessary in that case. Structural reshaping does not play an important role in the self-declared agenda for the second half of 2020. Instead, the reaction to specific countries, regions and conflicts fills far more space in the program, albeit more in the style of a mere enumeration of trouble spots. The priorities include the United Kingdom, China, Africa, Afghanistan, Syria and the Western Balkan.
While emphasising that “The United States is our closest foreign and security policy partner outside the EU” this represents one of the only two sentences addressing the plans for the relationship with the USA. Although the US presidential elections will fall into the German presidency, no strategy for the behaviour towards the Western global power is outlined. It is no secret that the relationship between the formerly close partners has become tense in the last years. Aiming for an amelioration of the ties would have been more credible than simply repeating the former status. It therefore seems that Germany tries to neglect the ongoing difficulties with the present US government and bids for Joe Biden to solve problems for the EU.
Two major – and also very similar – foreign issues are missing on the agenda, as well: Hong Kong and Belarus. It is obvious why the latter is not part of the program as the conflict did only arise after the beginning of the presidency period. In contrast, the conflict between the autonomous region and China has already existed before the German presidency. The two situations, nevertheless, are of very similar nature to the EU. Both countries experience major waves of protests in which state authorities are fighting against peaceful protesters. But this has not led to a similar response by the union. In the case of Belarus, the member states were able to find a common position very easily and are more straightforward in their response. Regarding Hong Kong, the EU has shown lacking capabilities to address the topic which certainly has to do with the inconsistent position towards China. It becomes clear that the formulated EU requirements regarding human rights are rather empty words in the case of China when seeing that it is stated: “The policy on China adopted by all EU institutions and Member States should be united and balanced, and shaped by long-term common EU interests and values.” while the issue of Hong Kong is hushed up. The affirmation to strengthen cooperation with China is the actual aim of the European member states as mentioned in the following sentence: “Together with the European External Action Service and the Commission, we want to expand cooperation with China and work to foster greater reciprocity in all policy areas.”
“Sovereignty is only transferred to the union when the common position reflects national interests – which does not signify sovereignty transition in the true sense.”
These two examples illustrate very well that the EU is capable of finding a common position, but only regarding already self-declared “enemies”, namely Russia. Sovereignty is only transferred to the union when the common position reflects national interests – which does not signify sovereignty transition in the true sense. And it shows how many economic considerations – of the individual European member states rather than the EU as a whole – shape European foreign policy. Single economic interests seem to outweigh security interests and defence efforts for democratic regimes. This case of double standards once again highlights the struggle for foreign policy sovereignty between the national and supranational levels – and makes clear that it is a very difficult issue to address in an EU council presidency. The question remains whether Germany follows actually serious efforts in this field or if this is just a smokescreen.
Free Trade: Limited sovereignty at the member states’ mercy?
As the EU’s roots lie in the European Economic Community and all member states share a single market without tariffs or trade obstacles it is only logical that the EU has plenty of jurisdiction over access to this Single Market, i.e. trade arrangements with non-member states. It might even be argued, that the only reason the EU sometimes gets a seat at the table despite the lack of diplomatic power, military capabilities and coherence between the member states is the tremendous economic weight of the EU.
Source: European Council
In the program for its council presidency, Germany states that it sees technology as an increasingly important part of International Relations. This surely is not only true in the light of the COVID-19 pandemic. It can also be observed in the struggle about the inclusion of Huawei in the rollout of 5G networks across Europe and the US. Germany promotes a monitoring system for digital capabilities and greater investments in digital sovereignty. It is however unlikely that the EU will reach digital independence and an equal level of technological development with the US or China without large-scaled efforts.
With the agreement between the EU and MERCOSUR on a Free Trade Agreement (FTA), Germany accomplished a major goal of its presidency a few days before it even formally began. Since then the ratification has proven to be difficult. France has declared its unwillingness to agree to the treaty over fears of increasing damages to the Amazonian rain forest. Chancellor Merkel and secretary of commerce Peter Altmaier have publicly admitted scepticism towards the project stating similar concerns. Brazil’s president Jair Bolsonaro has made it very clear that he sees environmental protection as an obstacle for economic development. It is doubtful that he will make credible reassurances to protect biodiversity, the rights of indigenous people and the climate. This example shows that if member states see their interests threatened by FTAs they are still able to block EU decisions even in this highly communalized policy field.
Together with Germany’s council presidency, the Cotonou agreement will come to an end this December. The EU wants to intensify the cooperation with African states over green transition, digital transformation, good governance and migration. Until this point, it is unclear whether it is possible to once again reach a deal with the African, Caribbean and Pacific states in time. Germany also pledged to drive negotiations about FTAs with other countries like Australia, New Zealand, Mexico or Indonesia. Furthermore, it supports the completion of the Panafrican Free Trade Zone AfCFTA and the EU-Asia connectivity strategy that supports interstate cooperation in central Asia. The increased efforts for economic development and trade with regions like central and southeast Asia and Africa can be seen as an attempt to establish Europe as a counterweight to China’s Belt and Road initiative. The goal of upgrading the EU’s dealings with the ASEAN states to a strategic partnership also fits the profile of containing Chinese influence in the region. Despite the many small steps to use the EU’s economic weight to gain political power, the EU has not yet found a way to adequately deal with the rise of Chinese influence.
All in all, it can be stated that the EU is trying to uphold its status of an economic power by gaining market access for its highly developed economy through FTAs around the world. Most efforts focus on emerging and developing markets. With the rise of the role of climate protection as a goal for member states and the commission, there is an increasing conflict of environmental and economic goals. Neither the EU nor Germany as council president has yet found a way to dissolve this conflict. Next to economic and environmental concerns, strategic aspects gain more and more influence on trade decisions. Thereby the EU uses its power in the highly communalized field of trade to make an impact in the highly intergovernmental field of foreign relations.
“The EU has limited sovereignty over trade at the mercy of its member states.”
However, sovereignty can not be measured by who is in charge of the negotiation strategy but by who is able to accept or dismiss the final draft of the treaty. While some FTAs that only touch topics that are without a doubt subject to exclusive EU jurisdiction can be ratified by the European Parliament, most significant FTAs are subject to ratification by the national parliaments. All in all the EU has partial sovereignty in the field of external trade relations. This exception can partially be explained by the long time this area has been communalized. The reason, though, that the EU has had authority over this topic for such a long time is that free trade is in most cases in the common interest of all member states as well in the EU’s itself. The single market also entails a common trade and tariff policy. In the end, the ratification against the declared will of the member states is unthinkable. The EU has limited sovereignty over trade at the mercy of its member states. This principle will neither be changed under the German presidency nor has it been addressed in the official program for the presidency. Shifting sovereignty to the EU looks different.
Lara Breitmoser, Florian Lenner and Jakob Rindermann