How does the EU solve a problem like the Ukraine?

Update 13:45 - According to Antonio Delgado, Spanish Public Radio's EU correspondent, "diplomatic sources" have indicated that the UK, the Netherlands, Italy, Spain and Bulgaria are all "not keen" on sanctions, although the Italian Foreign Ministry issued a statement claiming that “In the event of the continuation of violence, we don’t rule out resorting to exceptional restrictive measures”.

Commission President Jose Manuel Barroso on the other hand is optimistic:

Following developments in #Ukraine w/ shock & utter dismay. We expect targeted measures agreed by our #EU MS urgently http://t.co/nsy4JsSKhA
— José Manuel Barroso (@BarrosoEU) February 19, 2014

*****Original Post*****

The escalation in violence in Kiev yesterday and overnight poses a huge challenge to the EU. What, exactly, can it do here to prevent continuing civil disorder on its doorstep?

As ever when it comes to EU foreign policy, the first hurdle is to actually secure an agreement among 28 member states which is difficult in itself. As we've said on a number of occasions, Catherine Ashton's European External Action Service cannot magically replace 28 foreign policy positions - this has been proved time and again over Israel/Palestine, Libya, Syria etc. When it comes to the Ukraine, these differences have been apparent in how to deal with Russia in the first place, how hard it was to push for the EU-Ukraine trade agreement, then over how to deal with the anti-government protests, and now it looks likely they will appear in whether to impose sanctions. Here is a round-up of where the key EU countries stand on potential sanctions:

UK - Europe Minister David Lidington has condemned the violence and urged "all parties to return to the path of compromise and genuine negotiation" - no explicit reference to sanctions.

Poland - As the biggest supporter of Ukraine's eventual integration into the EU, Poland has consistently taken a hard stance on the issue. Speaking in the Polish parliament this morning, Prime Minister Donald Tusk called for targeted sanctions against those individuals "responsible for the Ukraine's misfortune". However, he conceded these tended to have limited effectiveness, but argued they sent a "moral" signal. He also slammed Russian pressure and warned that a civil war was possible. In a rare outbreak of political unity, the sanctions were also backed by the opposition Law and Justice party.

Germany - The German government (and the SPD in particular) has traditionally been very cautious when dealing with Russia so as not to alienate Moscow unnecessarily. For this reason they had opposed sanctions - supported by many in the European Parliament - but Foreign Minister Frank-Walter Steinmeier yesterday noted that personal sanctions will now "surely be considered". Chancellor Merkel will discuss the situation with President Hollande later today.

France - French President Francois Hollande said that he “agreed with [Polish PM] Tusk on the need for swift European sanctions, targeted at the main responsible for these acts.”

Italy – It is unclear whether Rome's position will change following the recent developments and/or the appointment of Renzi's new cabinet but the existing position was to oppose sanctions, with Foreign Minister Emma Bonino arguing a couple of weeks ago that "it has always been easy to announce [sanctions], but it has never been easy to apply them in a coordinated fashion. To me, this doesn't seem the way to go.”

Sweden - Another strong supporter of Ukraine's EU ambitions and of the anti-government protectors, Swedish Foreign Minister Carl Bild is as expected shouting the loudest, accusing Ukraine's President Yanukovych of "having blood on his hands".

Of course agreeing on a course of action is one thing - implementing it is another and the EU simply struggles to back up its rhetoric with 'hard power' due to the nature of the EU itself. The key will be how Putin responds if the situation continues to get out of hand - how will the EU respond if Moscow intervenes more directly? As the 2008 Georgian crisis showed - when the EU initially tried to present a common front - the Russians are very adept at exploiting any divisions and they still wield substantial leverage due to the reliance of many EU members on their energy resources.

Notwithstanding the need for a political solution to Ukraine's internal problems, there is surely a wider need for the EU and Russia to come to a sensible compromise over Ukraine's future - as the map below shows, geopolitically, the Ukraine is trapped between two large political and economic blocs (the map shows the respective customs union and potential members), and any closer political and economic integration of the Ukraine into the EU triggers Russia's age-old fears about 'encirclement'.

Europe reacts to David Cameron's defeat on Syria

Europe has reacted with surprise - and a degree of shock - to David Cameron's defeat in the House of Commons, which has de facto ruled out British participation in any potential military operation in Syria, at least for now. Here is a first round-up.

In an interview with Le Monde, French President François Hollande commented the outcome of the vote as follows,

Each country is sovereign [and can decide] to take part in a [military] operation or not. This is valid for the UK as well as for France.

Hollande suggests France could go ahead with or without the UK, and says,

If the [UN] Security Council is unable to act, a coalition will be formed. It will have to be the largest possible…It will have the support of the Europeans. But there are only few countries that have the capacity to inflict a sanction through the appropriate means. France is one of them. It’s ready [to act]. It will decide its position in close contact with its allies.

An editorial in Le Monde carries the headline, "The Commons vote against...Tony Blair", and notes,

It's the trauma of the Iraqi episode…that explains the 'no' of the British parliament to a [military] action in Syria. It's not David Cameron…who has been defeated. Rather, he pays for Tony Blair – as Mr Cameron himself acknowledged during the debate. 

As regards the international implications of yesterday's vote, the article goes on,

Washington has indicated that the decision of the UK – the privileged ally, the one of the 'special relationship' – would not stop the US intervening. But [the UK’s decision] can’t not embarrass Paris – even though, officially, France’s position remains that it is impossible not to react to the use of chemical weapons.

Germany's Die Welt has a comment piece entitled, "Cameron experiences his greatest humiliation". The article notes,

The refusal of the British House of Commons to participate in a military strike against Syria has left Cameron badly damaged - and with him the 'special relationship' with the United States.

Die Welt's chief correspondent Michael Strümer stresses how, once again, when it comes to 'hard power' the EU disappears. He writes,

While all eyes are on Washington, New York, Moscow, and on Damascus, Ankara, Cairo and Jerusalem, awkward silence reigns in Brussels…In the corridors of powerlessness in Brussels you can sense frustration and little momentum.

Christian Zaschke of Süddeutsche Zeitung describes the vote as,

A political slap in the face of historic proportions” for the Prime Minister, adding that it will define his tenure…On the international stage, [Britain] will be taken less seriously.

In Denmark, the only other EU country that has signalled it might take part in a strike, political leaders have this morning signalled that the country remains committed - although Foreign Minister Villy Søvndal also warned that the UK vote "calls for reflection".

When asked about the vote, Polish Foreign Minister Radoslaw Sikorski dodged the question, replying that it is important to have confidence in the UN inspectors' evidence. Sikorski also suggested that a possible solution could be for Russia to secure the Syrian regime's chemical weapons stockpiles - as the majority of them dates from Soviet times.
 
In Spain, an article in El País under the headline, "A blow to Cameron", argues that, as a result of the vote,

The British Prime Minister sees his authority seriously dwindled and, in an unprecedented event in the country’s modern history, has lost control over foreign policy.

Italian political commentator Gianni Riotta notes in La Stampa,

Paradoxically, Hollande, a French Socialist, seems to be the ‘hawk number one’. After securing a very prudent pension reform, he’s now trying to use strength against an ex colony inherited by the Turks to titillate the nation’s imperial pride – although Cameron’s defeat will lead him to take a milder stance.

We will keep updating the blog with any other interesting reactions throughout the day.

Syria: Who’s in and who’s out?

Plenty to ponder over Syria

Following the alleged use of chemical weapons by the Assad’s regime in Syria, the stakes have been raised. But as the calls for international military intervention grows louder, how have Europe’s various players been lining up? Well, the EU is certainly not “speaking with one voice.” Somehow neither the Lisbon Treaty, nor the EEAS nor the arrival of Cathy Ashton has managed to magically replace 28 individual foreign policies with a single EU one. (We remain shocked!)

So when it comes to Syria, there are now three key questions for the member states: whether to take part in military action; whether to back military action without necessarily taking part and, crucially, whether to do either of these two without a UN mandate. The last is obviously key as Russia is liley to veto any UN resolution with teeth, and has already made it clear it would consider any intervention without a UN mandate a "crude violation of international law".  

So far, we count three EU countries that have signalled willingness to participate militarily even if a UN mandate isn't forthcoming – the UK, France and Denmark. France and the UK - that between them account for most of the EU's military spending - are as usual the key players in the EU when matters are moved into the domain of hard power. David Cameron will today present a draft resolution proposing action against Assad's regime in the UN Security Council "authorising necessary measures to protect civilians" in Syria. Writing in the Telegraph today, British Foreign Minister William Hague argues that:

“this is the moment for democratic nations to live up to their values…We cannot allow the use of chemical weapons in the 21st century to go unchallenged. That would send a signal to the Syrian regime that they will never face any consequences for their actions, no matter how barbarous."

Meanwhile, French President Francois Hollande said yesterday that “France is ready to punish those who took the heinous decision to gas innocents," while French foreign minister, Laurent Fabius told Europe 1 radio on Monday: "The only option that I am ruling out is to do nothing." 

Both, it would appear, very much keep the option open to press ahead without the UN. 

Germany is more hesitant. There is virtually zero chance of Berlin playing a major part in any military operation of any sort. The question is - and this is what the German debate is centred around - will it back military action without a UN resolution. Remember, Germany ended up on the same side as Russia and China - against the UK and France - in abstaining on a UN Security Council vote on Libya back in 2011. However, this move was also triggered a domestic and international political backlash, which the Germans haven't forgotten. The country's Foreign Ministry has welcomed the UK's motion at the UN.

#Syria #Westerwelle welcomes British initiative to address poison gas attack within UNSecurityCouncil. United stance needed! @foreignoffice
— GermanForeignOffice (@GermanyDiplo) August 28, 2013

And there's no lack of scepticism. Phillipp Missfelder, the foreign affairs spokesman for German Chancellor Angela Merkel's CDU party, said that,"The [German] army has, through its current international operations, already reached the breaking point," and that military action without a UN mandate is "hard to imagine." However, interestingly, fellow CDU MP Ruprecht Polenz, Chairman of the Foreign Affairs Committee of the Bundestag, said that military action against Syria without a UN mandate could be "legitimate", citing Kosovo as a precedence, adding that the use of chemical weapons was a "serious, brutal taboo, which may not remain without consequences”. However, he stopped short of explicitly calling for German involvement. 

The SPD's chairman Sigmar Gabriel has suggested that German involvement should be limited to the diplomatic front, specifically that Chancellor Merkel ought to fly to Moscow to convince Russian President Putin to change his policy.

According to Number 10, Chancellor Merkel and David Cameron discussed the situation and “agreed that such an attack demanded a firm response from the international community.” (Not that this fairly generic statement tells us much.) Germany clearly remains nervous about foreign policy meddling. 

So far Italy is leaning back too. "Italy will not take part in any military solutions without a UN Security Council mandate," according to its Foreign Minister Emma Bonino. "Even the option of a limited intervention risks becoming unlimited," said Bonino, adding that Italy was "already stretched and even over-stretched" militarily in other parts of the world.

Despite Poland's support for the EU developing a stronger and more coherent military presence, Polish Prime Minister Donald Tusk confirmed today that “Poland does not envisage taking part in a military intervention in Syria. In any form.”

Like many others, Spain hasn't yet made up its mind but it is sticking to the hope of a UN resolution. Deputy Secretary General of the Partido Popular, Carlos Floriano, said Wednesday, that the Government will decide its stance “[once it is] aware perfectly of every detail." Meanwhile the Spanish Foreign Ministry said it hoped the UN Security Council “can make decisions that comply with international law.” 

Of the smaller countries, "non-aligned" Sweden is as usual calling  for “the broadest international support possible” but leaving it open how to approach a US/UK/France led operation absent a UN solution. Fellow "non alinged" country Austria is also staying quiet. Portugal says it won’t comment on potential action, with the Ministry of Foreign affairs simply issuing the generic statement that “it is in close coordination with its partners and allies.”

NATO-member Denmark, on the other hand, yesterday signalled that it’s willing to take part in military action even absent a UN-solution, with a series of pretty robust statements from senior Danish politicians. According to an opinion poll published today, 64% of Danes are opposed to such a move, however. 

Greece is likely to come under pressure to open up its strategically important bases to the US but ANSA quotes Greek officials as saying they have themselves “ruled out the possibility of active military involvement”. 

So what about the EU institutions themselves?  We wouldn't want to forget those. They are sticking to the ‘UN Security Council’ line. As Baroness Ashton said on Monday, "Of course the Security Council is extremely important in this. It is the role of the Security Council to look and see how the international community can and should respond."

With Hermann van Rompuy, President of the European Council, also urging similar action on Syria via the UN Security Council, this begs the question, what happens if that isn't forthcoming and the UK/France and US continue to push for military action? This then has the potential to become one of the biggest foreign policy clashes between the UK/France and Brussels since the new EU foreign policy architecture was put into place.

What the Egyptian crisis tells us about the (in)effectiveness of EU aid

As the crisis in Egypt continues to intensify by the day, European Council President Herman Van Rompuy and Commission President José Manuel Barroso warned in a joint statement yesterday that the EU would "urgently review in the coming days its relations with Egypt" - including the new aid package worth around €5 billion that was pledged to Cairo last year.

EU member states' ambassadors are holding talks today, followed by a meeting of EU foreign ministers on Wednesday. For the moment, though, Egypt's new military-backed government does not seem very impressed by threats coming from Brussels. As Foreign Minister Nabil Fahmy put it,

"I want to determine what is useful and what is not and what aid is being used to pressure Egypt and whether this aid has good intentions and credibility. We are not looking to replace one friend with another but we will look out to the world and continue to establish relations with other countries so we have options."

There is plenty of political posturing in Mr Fahmy's words, but this kind of reaction inevitably raises questions over how the EU has handled its relations with Northern African countries over the past few years, particularly via the European Neighbourhood Policy (ENP). 

In a report we published in May 2011, we stressed how, in the name of 'stability', the EU had consistently increased funding allocations for countries like Egypt and Tunisia, despite the European Commission itself noting limited progress on human rights and democratic reform over the years. In particular, we argued that the Commission's reliance on so-called 'budget support' - whereby EU aid money is given directly to neighbouring countries' governments and then directed towards specific projects by the latter - was clearly problematic, given the lack of transparency on how these funds were used.

The European Court of Auditors recently made a similar criticism in a tough report on EU aid to Egypt, where it suggested that the European Commission had been "too flexible" in assessing whether the Egyptian authorities were actually meeting the conditions for granting 'budget support'. The Court noted that,

"The Commission and EEAS [the EU's diplomatic service headed by Baroness Catherine Ashton] have not been able to manage EU support to improve governance in Egypt effectively. This was partly due to the difficult conditions they have faced in Egypt but also to shortcomings in the way the Commission and EEAS have managed their cooperation with Egypt."

The recent events in Egypt add one further element of concern. Despite its generous funding (Egypt was initially allocated approximately €1 billion for the period 2007-13, around 60% of which via 'budget support'), the EU seems to have failed to gain any significant leverage on the Egyptian establishment. Calls to stop the violence have been ignored - and the threat to stop the disbursement of aid has so far been openly snubbed.

This is of course a complex political situation and the circumstances are difficult, but given that the ENP is a very political aid instrument (seen by the EU as a tool to exercise its 'soft power'), it is getting increasingly difficult to see what value it has added in the case of Egypt.

UK report on EU foreign policy: Is it working? Is it accountable?

How diplomatic are diplomats when discussing a rival?

We've already blogged about the Government’s balance of competences report on the EU's impact on the NHS, now time for a quick look at what was said about EU foreign policy and external aid. The EU's External Action Service seems to have attracted some criticism:

“Critics argued that it was unclear about its role; lacked strategic focus and a policy planning division; was less dynamic than previous good rotating Council presidencies; was reactive rather than proactive; was less expert than it should be on important TFEU aspects of external action, such as climate change and energy, because relevant staff had reverted to the Commission upon the EEAS’s creation; was insufficiently joined up with the Commission on external instruments; and had low staff morale.”

But for balance it has some supporters to:

"Many thought it had played a valuable role on a number of issues, such as Iran, Burma, the Horn of Africa, and the development of a comprehensive approach combining a range of instruments"

However beyond the good job / bad job narrative the more important question is to whom are these EU diplomats ultimately responsible? The report talks about the “complex legal and institutional framework for the EU’s foreign policy”. This is a fair observation and one that makes EU diplomacy difficult to hold to account. The report is clear that the European Parliament is not the answer: "If the institutions’ performance does not improve; or if there is an undesirable shift in control away from the Member States, such as a greater role for the European Parliament; how will we alter our approach."


If one problem is accountability the FCO
does not think MEPs are the solution

The report makes some other interesting points as well, noting that “there are now few international organisations where there is not at least some effort to forge a common EU position, and have that position, even if it only amounts to a lowest common denominator, expressed by one participant on behalf of all the Member States.”

The report also notes - correctly in our view - that "the EU lacks the capabilities and the political will to play a major military role.” The EU can never aim and should never aim to be a coherent military/diplomatic actor on the world stage. It cannot do so because it does not have the military capabilities, the wish to pay for them or more importantly the political will to act.

Moving onto the issue of external aid, the report notes that "Although policy making at the EU level is often critically important, it can sometimes result in compromise positions that do not give full effect to UK priorities or that lack impact."

We have argued that EU aid is poorly targeted, with only 46% reaching low income countries, compared with 74% of UK aid, 58% of EU member state governments’ aid and 56% of United States aid - figures first flagged up in our 2011 report on EU external aid. This is largely a result of the large sums of the EU aid budget devoted to the EU's neighbourhood. The UK report largely glosses over this by only focusing on EU "activities that have poverty reduction or humanitarian response as their central purpose," implicitly reinforcing the point that many of the EU's 'aid' activities do not.

At a time when public confidence in overseas development spending is faltering, it is essential that this ‘value for money’ question at the EU level is addressed.

Commission's draft budget for 2014: The Good, the Bad and the Ugly

While all eyes will be on George Osborne and Ed Balls this afternoon, the EU Commission has slipped out its draft annual budget for 2014. This is important as it the first budget to be drawn up using the reduced expenditure limits (or 'ceilings' in EU-speak) agreed by David Cameron and other EU leaders in February. However, the European Parliament so far refused to sign off on these, so they remain provisional for the moment (more on this later). Here is our breakdown of the content of the budget according to the good, the bad and the ugly, continuing an earlier OE tradition.

The Good

Compared with 2013, there's a cut to the 2014 EU budget. The headline figure is a cut in both commitments and payments from €151.6bn and €144.5bn down to €142bn and €135.9bn respectively. This is a 6% cut in commitments and a 5.8% cut in payments. This is clearly a win for David Cameron who was mandated by parliament to secure a real terms cut in spending, but is also not all what it seems to be (see below). Next year's savings would be even lower if not for the fact some spending - such as the new €6bn youth unemployment initiative - is being 'front loaded' onto this years' budget.

Some particularly wasteful spending has been cut, for example the commitments on 'Communication actions' defined as spending aimed at "increasing the interest, understanding and involvement of citizens in the EU integration and policy-making process" has been cut by 20%.

The Bad

Somewhat bizarrely, the above savings have only materialised because a lot of money has been added onto the 2013 annual budget via a number of 'amending budgets' (a favourite tool for the EP and Commission) - increasing the total from €132.8bn to €144.5bn. If not for this additional cash, we would have seen an overall increase in 2014. While some of this additional spending can be justified - for example to accommodate Croatia - many believe that the bulk has been requested by the Commission simply to use up all the available money left under the current long-term budget rather than because it corresponds to an actual need for funds.

The European Parliament has made payment in full of this amount a pre-condition for agreeing to the 2014-2020 budget, and so far most of it has been pledged by member states (although the UK was recently outvoted on committing an additional €7.3bn of the additional funds requested as annual budgets are decided by QMV, not unanimity). In total, €3.9bn remains outstanding, so taking this off the total means we only have a reduction of 3.2%.

The Ugly

The substance of the budget remains broadly unreformed with the bulk of the budget still going towards distorting farm subsidies and regional development subsidies for wealthier member states (although the proportion of the latter has been reduced). In fairness overall spending on the CAP has decreased by 2.3%, but the amount going on farm subsidies tied to land ownership or production levels (the new CAP rules allow some re-coupling) will go up by 0.3%.

Administrative spending is set to go up again by 1.5% overall. The table below gives the full breakdown:

• While the drop in spending on European Schools is welcome, many of the other headings see increases at a time when the EU should be busting a gut to cut down on administrative spending, as member states have been for the last couple of years.
• The Commission has made some cut backs but due to salary increases of 0.9% it sees a 0.1% increase (or 0.8% increase when including cost of Croatia's accession). 
• Spending on EU officials' pensions has also increased by 7.2% due to the number of staff retiring ahead of the entry into force of the new Staff Regulations. This highlights the need to make further and more urgent progress on making EU expenditure on former officials' pensions sustainable.
• While the Court of Auditors, an institution that often flags up EU waste and mismanagement, sees its budget cut by 4.2%, the European Parliament sees its budget go up by 1.7% despite the fact that it has not committed to reducing its headcount unlike other institutions. This news comes the day after we highlighted a video of two MEPs pushing and shoving a journalist who had the nerve to challenge them for allegedly signing in to claim to their daily allowance before 'sodding off' straight away.
• Spending on the EU's 'decentralised agencies' which form the bulk of the EU's 52 quangos are set to receive a 3.8% increase while the European and Economic and Social Committee and the Committee of the Regions see a 0.2% cut and a 0.3% increase respectively despite the fact that these organisations are outdated, with no evidence of their usefulness whatsoever.
• While expenditure on the EU's external policies (aid and development) sees a fairly substantial cut of 8.2%, for some reason the institution that manages this expenditure - Baroness Ashton's External Action Service - has been awarded a 3.2% increase. In contrast the FCO sees an 8% cut in todays spending review.

The deal all rests on the European Parliament agreeing to the 2014 - 2020 MFF otherwise the 2014 budget will revert to 2013 ceilings + 2% for inflation. While this would not be an awful result for the UK mainly because of the security guaranteed by the rebate (see here for details), it would nonetheless most probably not result in an actual cut, thereby undermining David Cameron's claim to have achieved a degree of EU reform by cutting the budget for the first time in EU history.

Meanwhile, MEPs' initial responses don't exactly inspire confidence...

The EU budget proposal of the Commission for 2014 is again supporting the recession and unemployment instead fighting it.
— Hannes Swoboda (@Hannes_Swoboda) June 26, 2013

Westerwelle's Future of Europe report - worth getting excited over?

The so-called ‘Future of Europe’ reflexion group of eleven European foreign ministers, set up by Germany's Guido Westerwelle, to discuss and propose ideas on organisational and structural change in the EU held its closing meeting on Monday. Yesterday it released its final report and conclusions, the broad thrust of which is that, to emerge from the crisis, Europe needs more economic and political integration.

In terms of the economic and fiscal side, the majority of the proposals in the document have already been agreed or proposed, such as the “reinforced economic governance framework” – i.e. the fiscal treaty and a single supervisory mechanism for eurozone banks. Even the possibility of making the ESM into a fully-fledged European Monetary Fund has already been voiced. Furthermore, these proposals will only apply to eurozone members and any non-euro members who participate voluntarily.

It is therefore the political/institutional side that is the most interesting and here are the key points that we’ve picked out:

• More powers for Baroness Ashton and the EU’s External Action Service;
• More majority decisions in the Common Security and Defence Policy sphere including joint representation in international organizations where possible, and in the longer-term a European defence policy which for some members could eventually involve a European army;
• Strengthening the Commission should be strengthened so it can fully and effectively fulfil its role as the engine of the Community method;
• Moving to a super-qualified majority for future EU Treaty revisions (with the exception of enlargement) which would be binding for those Member States that have ratified them;
• A more “streamlined and efficient system” of EU governance which could include a directly elected Commission President, a European Parliament with the powers to initiate legislation and a second chamber for the member states.

Most of these proposals have been around the block once before but some journalists have gotten very excited about this, with the Guardian splashing the story on its front page. Running with a "Britain is isolated" theme it also noted that:

"The likelihood is that the 11-country consensus will swell into a majority among the EU's 27. Britain also stands apart from this. The 11 include Germany and France, the big ones, plus Italy, Spain and Poland – after Britain the biggest EU countries.”

Well, not quite.

Sure, some of these proposals are conspicuous, and certainly they pose a challenge for Britain. However, many of them have almost no chance of going ahead, certainly not in the immediate future. Firstly, the report represents less of a consensus amongst the relevent states and more of a brainstorming session with lots of dissenting views. As the note itself states:

“The report reflects our personal thoughts. We wish to underline that not all participating Ministers agree with all proposals that have been put forward in the course of our discussions, and that the Member States’ individual treaty obligations and rights within the various policy areas have to be taken into account.”

As stated above, there is significant momentum for more integration in economic, fiscal and banking affairs, but its hugely unlikely to spill over into foreign policy which exists in a parallel political sphere. This is simply a way to re-state the long-standing German desire for a Europeanised foreign policy (the practical difficulties of which have been made clear many times, most recently over Libya).

Super-QMV for treaty change won't happen either - not least since Berlin itself would block it if push comes to shove, as would Paris - unless they would be willing to risk - for example - QMV on the European Parliament's second seat in Strasbourg. 

Banking union, and calls for EU treaty negotiations to be opened by 2014 - as called for by Barroso in his 'state of the union' speech last week - is where the story is at.

The context for this whole initiative is effectively German domestic politics. While no one can question Guido Westerwelle’s European credentials, he is arguably one of the most side-lined Foreign Ministers in the whole EU, and the Future of Europe group is a way for him to show he's still a player.  For Merkel this serves as a useful exercise at a time when the German government is über-sensitive to accusations that it is not sufficiently ‘pro-European’ - but without actually having to do anything. 

Finally, it is worth contrasting the lofty idealism of such - and similar - proposals with the cold, harsh realities of public opinion. As we reported on Monday, support for the EU and the euro has hit an all-time low in Germany, in France a majority of those surveyed said that given the opportunity now, they would vote against ratifying the Maastricht treaty, while the EU debate in the Netherlands is also become more complex.

Ashton In Hot Water

Update 15:02 - Two additional twists to this story. The Telegraph's Bruno Waterfield has just noted on Twitter that an 'amended' version of Ashton's speech has now been published (see here). The controversial paragraph now reads, "When we see what is happening in Gaza and Sderot [an Israeli town less than one mile from Gaza] and in different parts of the world" - i.e. it explicitly mentions victims on the Israeli side of the Gaza strip. Amending a transcript would seem like a weird exercise had it not been for the fact that Ashton actually does make the reference to the two sides in the speech she delivered yesterday (available here, the reference is 12:30 in).

In other words, a full-scale diplomatic row has been triggered by what looks like a most unfortunate typo in a transcript...

EU foreign policy chief Baroness Catherine Ashton - or 'High Representative for Foreign Affairs and Security Policy and Vice President of the European Commission', as her official title reads - has a difficult job. In fact, its up there with managing the English national football team in terms of 'can't win' positions.

After having been on the receiving end of a barrage of criticism from left, right and centre, not least a letter signed by twelve member states in December - including Germany, France, Italy and Poland – in which they expressed concerns over the functioning of the EU's diplomatic service, the EEAS, Baroness Ashton has landed herself in some fresh controversy.

In a speech to a group of Palestinian youth in Brussels yesterday, she said,

"And the days when we remember young people who have been killed in all sorts of terrible circumstances - the Belgian children having lost their lives in a terrible tragedy and when we think of what happened in Toulouse today, when we remember what happened in Norway a year ago, when we know what is happening in Syria, when we see what is happening in Gaza and in different parts of the world - we remember young people and children who lose their lives."

This didn't go down well with the Israeli government, with a number of ministers coming out to criticise Ashton for what they see as an inappropriate comparison and reference. Defence Minister Ehud Barak said, "I hope that the EU's foreign minister will quickly realise the mistake she made and withdraw her comments." Opposition leader Tzipi Livni added,"There is no similarity between an act of hatred or a leader killing members of his nation and a country fighting terror, even if civilians are harmed."

Interior Minister Eli Yishai went even further and called for Ashton's resignation:

"The statement by Lady Ashton further harms the ability of the European Union to be an honest broker [between Israel and the Palestinians...[Ashton] can no longer serve in her position."

In a statement today, Ashton's spokesperson sought to clarify the remarks:

We want to make this clear, because her words yesterday...were grossly distorted by one of the news agencies. In her remarks, [Ashton] referred to tragedies taking the lives of children around the world and drew no parallel whatsoever between the circumstances of the Toulouse attack and the situation in Gaza.

Judge for yourselves - Asthon's full speech is available here, with the last paragraph being the key one for the discussion.

As we said, Ashton really does have a difficult job.

EU military HQ always going to be a non-starter for the UK

As if the EU hasn’t got enough on its plate, yesterday saw EU Foreign Minister Baroness Ashton present a proposal, at a meeting between EU foreign ministers, calling for the creation of an EU military headquarters (a so-called ‘Operations Headquarters’ OHQ). This comes despite the fact that the new External Action Service itself is barely even up and running. And despite the increasing number of voices that doubt that a single EU foreign policy is even possible.

According to the Sunday Times, Ashton wants the OHQ to “command and control” future European civilian and military campaigns. The idea has been knocking around since 2003, when it was rebuffed by the UK and the US, among others, but has been revived with the backing of France, Germany and Poland. French support for the measure goes back some time but it has always met with staunch opposition from the UK, which sees it as an unnecessary duplication of existing NATO arrangements.

Given that this is a decision that would require unanimity and that the UK is one of only two major EU military powers (France being the other), yesterday’s proposal seemed an unwise, direct challenge to the UK. The response from William Hague was expectedly unequivocal,

"There is no way we will agree to this, now or in the future...We won't be agreeing to a permanent operational headquarters and therefore we are not able to welcome today's report by Cathy Ashton, the High Representative, on this matter".

"We are opposed to this idea because we think it duplicates NATO structures and permanently disassociates EU planning from NATO planning”

"Secondly, it's likely to be a much more costly solution than existing structures; and thirdly, a lot can be done by improving the structures that already exist"

This isn't simply a case of the UK 'not seeing the need' for a permanent EU military HQ, it is that it sees it as a potential threat to the UK's national interests. Britain will veto anything that looks like it might threaten NATO because, when it comes to defence, the transatlantic alliance remains paramount (and probably always will).

It is often said that the UK doesn't 'understand Europe' but this example illustrates that this also works the other way.

The Libyan conflict has shown that European countries can and need to work together when there is the political will to do so. However, like over Iraq, it has also shown that there are often fundamental disagreements on the use of military force among EU member states, this time with France and Britain on the one side and Germany on the other. If they are serious about defence, European governments need to boost their individual capabilities and improve interoperability on an ad hoc basis. EU mission creep is simply an unnecessary and potentially damaging distraction.

Hague and Lidington raising the stakes?

The last few days have seen some tough talk from the UK's Foreign Office on the size and role of Catherine Ashton's External Action Service. Following a meeting of EU foreign ministers yesterday, Europe Minister David Lidington used uncharacteristically undiplomatic - albeit justified - language, describing Ashton's demands for a 5.8% increase to the EEAS' budget next year as "somewhat ludicrous", adding “They’ve got to get real as far as the budget is concerned.” (indeed)

He also made a point of underlining how the FCO is now keeping a watchful eye on the EU's 136 embassies around the world, saying that “William [Hague] has sent out instructions to all our posts around the world to be vigilant about any risk of competence creep,” referring to the ever-present risk of the EEAS taking on an increasing number of responsibilities that should belong to member states.

And, in case anyone in Ashton's bureaucratic machine hadn't quite got the message, the man himself (Hague, that is) used an interview on the Today Programme this morning to fire a couple of warning shots of his own. On the proposed budget increase for the EEAS, he said,

"I don't think it is necessary to have such an increase at a time where diplomatic services across the world, certainly across Europe, are tightening their belts, becoming more efficient. We are expanding our diplomatic network in the world but we are doing that by saving GBP100 million of administrative costs."

On the risk of the EEAS' incrementally increasing its power, he noted,

"We will always guard against mission creep. We are very clear about what's a UK responsibility and what is an External Action Service responsibility. I am certainly giving a pre-emptive warning. Where we have seen one or two instances of it, we have dealt with that but we will always be vigilant about that."

Then he went on to make, possibly, the most important point of all - which we highlighted in our recent paper looking at the need to overhaul the EU's North Africa and Middle East policy (which to be fair, is a view that the Commission/the EEAS is coming around to as well):

“Where more money is needed…is the much bigger project, and it’s one much in line with what the United States is seeking, of a bold and ambitious approach to change in the Middle East and North Africa - Europe providing a magnet for positive change; the resources that will help small and medium sized enterprises to grow in these countries and bring economic stability. And that is the big issue rather than the administrative budget of the External Action Service."

This is a pretty robust - but more importantly a sensible - line from the Foreign Office. More please.

What's the point then?

This is a pretty interesting comment from the Chief Operating Officer of the EU's diplomatic service (the EEAS), David O'Sullivan. In an interview with EUobserver, he said:

"At the end of the day, it's the member states that decide whether they want to speak with one voice, and there are moments when there are divergences. The High Representative [Baroness Catherine Ashton] has difficulty expressing a common European view if one doesn't exist...It is our hope that [the EEAS] will facilitate this process...We cannot at the end of the day change fundamental disagreements between member states."

Well put. As we've consistently argued, institutions cannot replace real policies - particularly in foreign affairs where it's clear that the EU remains a bloc of 27 national policies, which occassionally find common ground.

But his begs the question: what's the added value of the EEAS in the first place? If Ashton and the EEAS don't have the power to act in the absence of a common position shared by all 27 member states - a rare occurence indeed - is it then really worth spending hundreds of millions of taxpayers' money every year (€464 million only in 2011) to run a giant "facilitator"?

Given the criticism Ashton is facing (Only two weeks ago, Belgian Foreign Minister Steven Vanackere openly criticised her inability to get EU governments to agree on any of the most sensitive issues - not least the upheavals in North Africa and the Middle East - during her first year in the job), we wonder if the good Baroness isn't starting to ask herself that question as well, despite some good talk.

EU Foreign Policy: Kum-bay-ah or Machiavelli?

The EU’s fledgling External Action Service has regularly been mocked for its naivety and ‘Kum-bay-ah’ approach; all too often it seems to base its polices on projecting a positive image of the EU, occasionally backed by some suitably bland statements, supposedly helping autocrats and dictators around the world to see the error of their ways and embrace reform.

It seems however, that the recent unrest in North Africa and the Middle East has brought a hitherto hidden Machiavellian tendency in the EU’s foreign policy to the fore. Firstly, we had the Maltese EU Commissioner for health going off-message on Libya a couple of weeks ago by saying he “didn't think [he] had the right, or anyone else, to make a statement on whether he [Gaddafi] should step down”.

Now Robert Cooper, senior advisor to EU foreign affairs chief Catherine Ashton, has claimed Bahrain is normally "a rather pleasant, peaceful place", and defended its security forces after they opened fire on protesters with live ammunition last week:

"I'm not sure if the police have had to deal with these public order questions before. It's not easy dealing with large demonstrations in which there may be violence. It's a difficult task for policemen. It's not something that we always get right in the best Western countries and accidents happen”.

His statement ought to be seen in the context of an earlier work in which he claimed:

“The challenge of the postmodern world is to get used to the idea of double standards…When dealing with more old fashioned kinds of states outside the postmodern continent of Europe, we need to revert to the rougher methods of an earlier era – force, pre-emptive attack deception, whatever is necessary… Among ourselves we keep the law but when operating in the jungle, we must also use the laws of the jungle”

This also follows the reports that another Ashton aide was briefing against a no-fly over Libya, which briefly put her at odds with both Cameron and Sarkozy, until it was explained away as a 'rogue briefing'.

These kinds of ill-advised comments emanating from the EU apparatus, and the fact that we'll never know who authorised them, demonstrate inconsistency, and further undermine the EEAS's objective of getting Europe to "speak with one voice". They also underline the potential danger of a power struggle over the EU's foreign policy at a time when Europe is facing an uncertain future.

Klaus on the summit

Speaking about splits, here's a pretty frank and thought-provoking note from Czech President Václav Klaus, regarding today's EU summit on Libya:

Notes for the European Council on Libya

1. The Czech Republic considers today’s meeting as very important and timely. We support the measures, including sanctions, that have been introduced up till now on the side of the EU.

2. However, when we looked at the draft of the declaration, we did not find it very persuasive. There is no clear signal coming from it. Short-term and medium and also long-term goals and ambitions should be differentiated. I suppose we have met here today mainly because of the acute situation in Libya, which means we aim at a short-run. Of course, we must be able to see it in a wider and longer perspective and strategically, we have to know what to do not only today, but also tomorrow and day after tomorrow. Some of us attended the EU-Africa summit in Libya last November. I am afraid some of us did not see the crazy nature of Gaddafi’s regime and did not behave in a way which justifies our current strong words.

3. The Czech Republic is convinced that we have to try to help to stop the humanitarian tragedy in Libya now, but without intervening militarily in Libya or any other country, without picking up potential new leaders etc. In this respect we consider the recognition of the “Benghazi” Council at least premature, if not basically wrong.

4. We should be aware of the long-term consequences of our decisions. I warn – and that is the position of the Czech Republic – against talking about a no-fly zone because there is nothing like that. No-fly zone means a war because it requires to destroy both Libyan aircrafts and helicopters and Libyan air defense. It is a war. The pressure we should make is the resolute requirement for Qaddafi to step down without negotiating with him. I stress stepping down before negotiations, this sequencing is absolutely crucial. Unconditional surrender is the only possibility. We should make it very clear.

5. Several side-remarks:
- It seems to me it is necessary to warn against comparing the situation in Northern Africa now with Central and Eastern Europe 20 years ago (Buzek), at that time the “rebels” (Orban, me) had clear views about the future, I am not sure it is the case in Egypt or Libya now;

- The experience with one of the institutions which were hastily established after the fall of communism in 1989 – the EBRD – is visibly negative. It has never been a real help to the countries in my region. We are, therefore, very much against creating another similar bank, we suggest to delete the idea of the “Bank for the Mediterranean” out of the text;

- On the contrary, we suggest to include one idea into our declaration which is not there – our long-term help should be offering the North African region open markets in Europe;

- I heard, in our meeting before lunch, the term “Gaddafi’s money”. It reminds the attempts to find “communist bosses’ money” in our part of the world. Nothing like that exists.

Václav Klaus, Brussels, 11 March 2011

Lowest common denominator

EU leaders - still visibly split - have just agreed on a trade-marked "least common denominator" statement on Libya, following today's summit in Brussels. Speaking at the end of the summit, David Cameron said that the EU's 27 leaders were "united, categorical and crystal-clear" that Gaddafi had to go - which is a welcome statement (Gaddafi is a maniac after all) but not much different to what the EU leaders who matter had already called for.

In terms of substance, EU leaders agreed new sanctions against financial institutions linked to the Gaddafi family, adding the Libyan Central Bank and Libyan Investment Authority to the EU asset-freezing list. It also agreed that "contingency planning" involving "all options" should continue, in case Gaddafi and his LSE-educated son, continue to act crazy.

The communique didn't refer to a no-fly zone, however, despite Nicolas Sarkozy calling for "defensive" and "limited" air strikes - something he said he had British support for.

Before the summit, Sarko said,

"We the French and the Britons have given our availability – under the explicit condition that the United Nations want it, the Arab League agrees to it and the Libyan Authorities that we want to be recognised wish it – to carry out targeted, purely defensive actions, and only in the event that Mr. Gaddafi used chemical weapons or the aviation against people who are demonstrating without violence."

The reluctance of other leaders to subscribe to this reasoning means that the UK and France were sidestepped on this point. The EU remains all over the place on a no-fly zone (and France still stands alone in recognizing the Libyan opposition).

This also appears to be the first time that Cameron has openly clashed with EU 'foreign minister' Cathy Ashton, who according to PA, is now warning against a no-fly zone. An EU diplomat is quoted saying:

The efficiency of a no-fly zone is very questionable. Apart from anything else, European command and control facilities would not be able to get a no-fly zone up and running in less than five or six weeks, and Nato is suggesting it would take at least three to four weeks.

All of this is of course being played down by Downing Street.

That the EU's two most credible military powers and only permanent members of the UN security council are seemingly at odds with the other 25 member states illustrates the limitations on the EU's foreign policy ambitions. Although a no-fly zone would almost certainly require US approval and firepower, in Europe, the UK and France are the only game in town if things get really nasty. But still, everyone must be included, no one left out.

Today's meeting was all about EU self-assurance and will have little bearing on on how things turn out on the ground.

The EU should impose sanctions on Gaddafi

Over on the Spectator's Coffee House blog, we set out the case for imposing sanctions on Gaddfi's regime (while also looking at the difficulties EU member states are facing in coming up with a common policy on Libya, in what is a painfully familar story).

We argue,

The EU spends €460 million a year in operational costs alone on its new foreign policy department, the External Action Service, headed up by Catherine Ashton. This body - created by the Lisbon Treaty - was Europe’s ‘great white hope’ for the global stage, finally allowing it to speak with one voice and therefore giving it leverage where it previously had none.

It hasn’t quite worked out that way. Caught between Cairo and Tripoli, the EU has received yet another reminder that its bureaucracies and institutions cannot magically replace 27 individual foreign policies, as EU leaders continue their bickering over what to do.

The EU’s response to the turbulence in Libya has been fragmented at best, and contradictory at worst. Italian PM Silvio Berlusconi – one of the few EU leaders with some clout in Libya – initially said that he didn’t wish to “disturb” Colonel Gaddafi since the situation was “evolving”. Czech Foreign Minister Karel Schwarzenberg maintained that the EU should not "get involved too much" because, "If Gaddafi falls, then there will be bigger catastrophes in the world”, though he later said he had meant something else.

In stark contrast, Finland, France – and in more careful language also Germany – have called for sanctions to be imposed on Gaddafi, including a travel ban and a freeze on his and his family’s assets, something categorically rejected by Italy and a few other countries. Still others have spoken in terms of general condemnation but proposed no concrete action, a group including Britain so far. Meanwhile, no one is paying much attention to the EU’s alleged foreign policy chief, Catherine Ashton. It all feels awfully familiar.

Does the absence of a common EU stance matter? I believe it does. While it’s true that the EU’s leverage in Libya and some other parts of Northern Africa and the Middle East is very limited, when Europe does pull together it can actually exert influence in its backyard. Enlargement remains the EU’s greatest foreign policy achievement made possible through a mix of aid and trade incentives.

So what should be done?

The UK should throw its full weight behind German, French and Finnish calls for sanctions, including an EU-wide travel ban on Gaddafi and his family, as well as a freezing of their assets across the bloc. Other possible responses, such as imposing a no-fly zone over Libya, should also be explored. The Colonel’s delirious speech yesterday – and his son’s comments that the family will fight “to the last bullet” – have confirmed that Gaddafi ranks amongst the Mugabes of this world (if anyone for a second thought otherwise).

Finnish Foreign Minister Alexander Stubb put it best when he said that "How can we on one side look at what's going on in Libya, with almost 300 people shot dead, and not talk about sanctions or travel bans, and at the same time put travel bans and sanctions in Belarus?". EU-wide sanctions could hurt Gaddafi – financially and politically – but waiting for too long will lessen their impact.

In terms of responding to the challenges in the wider region, David Cameron is absolutely correct in calling for radical reform of the EU’s neighbourhood policy, which together with other European programmes (such as the European Investment Bank), has dished out billions to the region, with few strings attached. In future, no reform on the human rights front should mean no cash.

At the same time, the EU needs to use other incentives and tools to promote long-term democratic and economic transformation in the region. For example, the EU should consider opening up its markets to more goods from North African countries on the path towards democracy. This should include agricultural products, which at the moment face a patchwork of tariffs in various guises before they can enter Europe. These barriers are contributing to rural poverty in North Africa and therefore instability. The UK is in a strong position to spearhead such trade reforms.

To give with aid on the one hand and take away through trade restrictions with the other makes no sense. Alas, it’s symptomatic of the inconsistency that too often characterises the EU’s relations with the outside world.

The Libyan protesters’ push for change presents an opportunity for Europe to put this right.

In case you missed it...

In case you missed them, here are a few of Open Europe's appearances from this week - on three very topical issues:

On Tuesday, Open Europe discussed the problems with the EU's structural funds on BBC Radio 4's File on 4 programme. Listen to it here (worth a listen, particularly the part looking at the ongoing problems with fraudulent use of the funds).

On Wednesday, we debated the EU's External Action Service on Radio France Internationale, arguing that it's far from clear that the EU's diplomatic body adds value at the moment - and that the EU should be focussing on policy rather than institutions. Listen here (in French)

We also appeared on the BBC Radio 4's The World Tonight, discussing the future of the euro.

We are where we are

The phrase "we are where we are" was oft repeated in this evening’s debate in the House of Commons – but sadly for many MPs it seems that ‘where we are’ was anywhere other than the Green benches judging by the numbers in attendance.

While a Hansard transcript is not yet available to link to for those interested in the debate – there are a few worthwhile interventions to take note of.

NB: This was a debate to approve a motion on the EU’s External Action Service – allowing the Government to give its official approval to the launch of the EEAS at the next meeting of EU leaders.

David Lidington made clear that EU Foreign Minister Cathy Ashton and the EEAS may only represent an EU common position where it has been agreed by unanimity among member states ahead of time. Of course while that may work in practice, EU embassies will likely be offering positions before they become official in an informal manner in third countries.

The Europe Minister also said (in what we suspect is a dig at the European Parliament over their refusal to agree to the EEAS blueprint before they got everything they wanted) that those who argued that Lisbon would be an end to the institutional turf wars “were plainly wrong”. He also said that member states had resisted the proposals of the EP that it be able to hold official ‘confirmation’ hearings of the heads of EU delegations, and to bring the entire service under the control of the Commission (and by extension the European Parliament).

Mr Lidington also said that the Government accepted that, despite promises of budget neutrality for the service, the start-up costs and the burden of bringing over national secondees to Brussels would require start-up funding – of which he estimated the UK’s share would be approx £1.1 million (before any reduction for the rebate).

Interestingly, former Europe Minister Chris Bryant suggested that it was “optimistic” to believe that only £1.1mn additional funding would be needed (we share his opinion on this) and that there may be pressures from other member states further down the line for the EU to shoulder some of the cost burden of foreign representation.

Mr Bryant also said that there was no assurance in the agreement that no additional money could be requested in order for the EEAS to provide consular services – something which the UK and other countries are opposed to anyway.

And finally Richard Ottaway, new Chair of the Foreign Affairs Committee in Parliament, said that he thought the increased role for the new EU delegations – the fact that they represent the EU as a whole rather than the Commission – was potentially “one of the most significant changes” introduced under the Lisbon Treaty.

Update: The results of the division were 321 in favour of the motion, 12 against. Parliament stamps its approval on the EEAS.