The Wider Europe

In this first Issue Paper, Fraser Cameron reflects on the European Union's strategy towards its wider neighbourhood, post-enlargement to a Union of 25.


Introduction

As from 1 May 2004, the EU will have 25 members and a population of 450 million. The historic decisions of the Copenhagen European Council regarding enlargement has rekindled a debate on ‘The Wider Europe’. But what does this term mean? To some, such as Commission President Prodi, it is a debate about the EU’s future borders and establishing ‘a ring of friends’. For the Greek presidency, it involves a debate about our identity and values. To others, it is about establishing a new ‘neighbourhood policy’. And there are yet others, who think it is about devising a formula to satisfy countries that might otherwise hastily apply for membership, or who will fail to meet the criteria. In short, there is no agreement on the definition or even the concept of ‘the Wider Europe’.

Enlargement and the Wider Europe go hand in hand. Ensuring the success of the enlargement process is an essential pre-requisite for the Wider Europe. The accession states will certainly wish to accord higher priority to their eastern neighbours as this will help their overall security position.

On 11 March, the Commission agreed on a communication about ‘neighbourhood policy’ proposing a concrete agenda for the coming 5-10 years for southern and eastern neighbours but not the Balkans. The communication seeks to encourage the Member States to face up to the realities of the enlarged Union’s closer geographical proximity and increased interdependence with its eastern and southern neighbours. It suggests that the Union can have a strong external relations policy which achieves results when it comes to promoting reform, mutual stability, security and sustainable development without extending an offer of eventual membership of the political institutions

Recent history, however, demonstrates that the ‘waiting room’ formula has had a distinct lack of success. For most countries, there is only one game in town – the EU – and that implies full membership. The OSCE, Council of Europe (even EFTA/ EEA) are important bodies – as is NATO’s Partnership for Peace - but not the real thing. Outside the EU there is little enthusiasm for the formula of membership of ‘everything but the institutions.’ 

Key Recommendations

• Ensure the success of present enlargement process; there will be an inevitable lengthy ‘digestion’ period.
• Continue an ‘open door’ policy with other potential candidates.
• Increase involvement in SE Europe. EU cannot afford a failure in the region.
• Make more use of conditionality.
• EU needs to find more funding and human resources to ensure the success of neighbourhood policies. Priorities overall include justice, education, public sector reform.
• Involve new neighbours in more meaningful political dialogue, and where possible invite them to participate in EU operations.
• Keep economic reform a top priority, through benchmarking to accompany structural reforms; support of WTO membership for neighbour countries and more resources for European Investment Bank (EIB).
• Build on proven approaches (e.g. twinning) and seek innovative approaches (e.g. lead Member States helping neighbours)

What is Europe?

The question of what is ‘Europe’ has provoked much discussion but little consensus over the years. There is little dispute about the northern, western or southern borders of Europe. The eastern border of Europe has always provoked controversy. Some geographers in the 17^th century doubted that Europe was a continent at all, rather an appendage of Asia. Only in the first half of the 18^th century did the Court of Tsar Peter accept the thesis of the Swedish officer, Philipp Johann von Strahlenberg that the Ural Mountains were the border between Europe and Asia. This decision helped the pro-Western reformers at the Russian Court as it negated the opinion of Western European geographers that Moscow was situated in Asia. The Europe debate in Russia continues to this day.

Since the 1950s there has been a closer and closer entanglement of Europe with the European Union. To most of the outside world, Europe means the EU. Significantly, the EU has never attempted to define ‘Europe’. The problem of definition was raised in Agenda 2000 when the Commission declared that it was ‘a question for each generation’. It pointed to some of the difficulties such as the fact that the Urals were the geographical border of Europe but not a state border. To finesse the issue, Europe’s leaders have rallied around the ‘Copenhagen criteria,’ which have been extended over the years as a result of the developing EU acquis.

The Neighbours

The EU has always had a neighbourhood policy. During the Cold War, the focus was on EFTA and the Mediterranean. Since 1990, the eastern and south-eastern parts of the continent have gained most attention as this is essentially where the main problems lie. The collapse of communism and the break-up of Yugoslavia were traumatic events for all of Europe.

To the north, Norway and Iceland are eligible for membership (as is Switzerland in the centre).  As economically advanced countries with an average GDP above the EU level, they could be quickly integrated into the Union. The political consensus, however, is absent in all three countries although opinion may be changing towards EU accession in Norway.

To the west, Ireland is the limit (although the US often seeks to act as a member!).

To the south, the Mediterranean forms the barrier – at least the countries on the southern littoral. When Morocco applied some years ago, it was politely told that it was not European. These countries are covered in the Euro-Med or Barcelona Process, currently stalled due to lack of progress in the Middle East peace process. There has also been a reluctance on the part of the EU to liberalise agricultural trade with the Euro-Med countries and they, in turn, have been reluctant to liberalise relations between each other. The Barcelona process remains vital to the EU and is badly in need of a kick-start.

In south-east Europe, the Balkan countries (Albania, Macedonia, Bosnia-Herzegovina, Serbia and Croatia) are all deemed eligible and progressing at different speeds towards full membership, via the Stabilisation and Association Agreement process (SAA). They are all plagued by unresolved political/constitutional issues, lack of economic development and a mix of crime and corruption. Croatia has recently applied for EU accession.

Turning to the east, there are four immediate neighbours with whom the EU has Partnership and Cooperation Agreements (PCAs) – Russia, Ukraine, Moldova and Belarus. Despite their shared Soviet heritage, they are very different states. Russia still regards itself as a great power. Boris Yeltsin once said his aim was EU membership and even President Vladimir Putin has not ruled out the idea. Ukraine, independent for only just over a decade, is struggling to cope with severe internal political and economic problems. However, the goal of EU membership, with an association agreement as a stepping-stone, has been a constant priority since independence. Belarus is a pariah state and likely to remain so under Alexander Lukashenko. The PCA has been signed but not implemented and EU attempts at conditionality have yielded little results. Moldova is a failed state, the poorest in Europe, and suffering from the apparent insoluble problem of Transdniestria. Without a solution to this conflict (and the key remains in Moscow), Moldova will remain a source of instability in the region.

The three Caucasian states (Georgia, Armenia and Azerbaijan) also enjoy PCAs and see their long-term future within the EU. They have, however, received little attention and no encouragement from the EU about reaching this goal.

As regards Turkey, it was given an implicit undertaking that it was eligible for EU membership in 1963 when it signed an association agreement with the EU. In 1997, it signed a Customs Union with the EU and in 1999 Turkey was given explicit candidate status at Helsinki. More recently, the Copenhagen European Council agreed that the position of Turkey should be reviewed in December 2004. If on the basis of a report by the Commission, Turkey were to fulfil the Copenhagen political criteria then the EU would open accession negotiations with Turkey without delay. For the medium term, therefore, Turkey has its eyes firmly fixed on membership and will not be content with any alternative formula. The new Turkish government has continued to make progress on the Copenhagen criteria but the role of the military remains problematic. It should be noted that some parts of the European political spectrum, notably the European Peoples Party (EPP), are strongly opposed to Turkish membership on principle.

The EU’s neighbours are thus very different, varying in size from huge Russia to small FYROM, from rich Switzerland to poor Moldova. This means that there can be no one size fits all approach; rather the EU has to tailor its policies to individual circumstances.

Enlargement and the Political Climate 

It is a sad reflection that so few EU leaders have been willing to proclaim the historic importance of the enlargement decisions at Copenhagen. Behind the scenes, politicians and officials are worried at the unknown implications of the current enlargement (the inevitable lengthy digestion, new relationships – especially with the US, budgetary impact, changing priorities, functioning of the EU, etc) and less than enthusiastic about the prospect of further enlargement. The recent Croatian application was not given much attention. There is also widespread public concern in several Member States about the costs of enlargement, the prospect of job losses and increased crime. In many accession countries, there is also considerable scepticism about the benefits of EU membership and worries about sharing sovereignty.

Kok Report

 A report in March 2003 by the former Dutch Prime Minister, Wim Kok, sought to put a more positive spin on enlargement, stressing the many benefits of enlargement, but it received little publicity. The report stressed the advantages of enlargement as follows:

• Acting together in Europe
• Boosting the European economy
• Making Europe Safer for its Citizens
• Developing a partnership with the EU’s neighbours
• Giving Europe a stronger voice in world affairs

Member States Views

There are also divisions between the Member States on what more should be done for the immediate neighbourhood – primarily the four states to the east. Some would like a new form of agreement, especially with Russia, while others believe that there should be no new agreement until these states have demonstrated their willingness and ability to meet existing commitments. This latter view is also strong within the institutions. It remains to be seen how the new Member States will react to these issues. It seems highly likely, however, that Poland will push for closer EU-Ukraine relations. Indeed the Poles recently circulated a non-paper on ‘the new neighbours initiative’ outlining a number of interesting policy proposals.

US Views

The US has long pushed for a ‘Europe – whole and free’. It has expended much political capital on pressing Turkey’s case for EU membership but has lessened its involvement in Ukraine as a result of the current political leadership there. The US also lobbied hard to secure support from central Europe over Iraq and other issues such as the International Criminal Court (ICC). Talk of ‘old Europe’ versus ‘new Europe’ has also cast doubt on US support for European integration while the attitudes of some central European countries on Iraq (notably the signatories to the Gang of 8 and the Vilnius 10 letters) has also raised fears about their becoming US ‘Trojan horses’ in the Union.

EU Interests and Options

What are the EU’s interests in the Wider Europe? The EU has an overriding interest in the stability and increasing prosperity of its neighbours. Huge gaps remain in living standards and approaches to democracy, human rights and the rule of law between the Union and its neighbours. Instability in the EU’s neighbourhood could have negative spillover effects, particularly as regards crime and illegal immigration. This is already a serious problem with regard to the Balkans and the Mediterranean. Since 1991, the EU has spent over 20 billion euros dealing with the fallout from the break up of Yugoslavia. It cannot afford to slacken its efforts now. It is also of major importance for the EU to help further development in the Mediterranean countries, not least because of the impact it would have on the wider Middle East. The EU also has an interest in promoting its fundamental values regarding democracy, human rights and the rule of law and engaging its major neighbours in support of EU policies and global institutions.

On the economic side, the EU has important trade relations with Turkey. Its trade relations with Russia are heavily slanted towards the energy sector but there are hopes of an expanded and more diversified trade relationship in future. Trade relations with Ukraine are of minor interest at present.

A recurring question is whether the EU should recognise the membership aspirations of Ukraine, Moldova and Belarus (and Russia). Commission President Romano Prodi and others have gone on record opposed to Russian membership. Italian Prime Minister Silvio Berlusconi is the only EU leader to have spoken in favour. Few European leaders have come out explicitly against membership for Ukraine but only German Chancellor Gerhard Schröder has welcomed such a move.

A further issue for the EU is to decide whether to deal with individual states or groups of states. Although one can make a convenient distinction into three groups - the Euro-Med, the Balkans and the four new eastern neighbours, - there is little sign of cohesiveness within these groups. Previous attempts to provide some umbrella formula, such as the ill-fated Mitterrand proposals for a ‘confederation’ and the equally ill-fated experience of the  ‘European conference’ demonstrate the difficulty of such arrangements. One day ministerial or even official meetings with over 50 participants, with very different interests, are not a formula for success. There is a clear trade off between numbers, diversity of interests and efficiency. Nevertheless there are those who think that one should not exclude some future umbrella arrangement involving the EU, Russia, Ukraine and Turkey (assuming Ankara fails to meet the Copenhagen criteria). One such suggestion is the EEA but if a state were to reach the standard for the EEA then it would certainly prefer full membership.

Commission Communication

There are various options on the table, some of which have been discussed at ministerial meetings on the Wider Europe in the past six months, and as observers have remarked, were less than illuminating. The discussions raised more questions than they provided answers and overall there was little desire for substantive action. The Copenhagen European Council invited the Council and Commission to come up with new ideas and in March the Commission agreed a communication ‘Wider Europe – Neighbourhood’ focussing largely on how the Union might promote reform in and closer relations with the eastern and southern neighbours. But it did not cover the wider strategic and security issues, including the impact of NATO enlargement.

The communication proposed that further measures to enhance integration and liberalisation should be implemented gradually and progressively, responding to positive action on the part of the neighbouring countries.

These measures are:

• Extension of the Internal Market and Regulatory Structures
• Preferential Trading relations and Market Opening
• Perspectives for Lawful Migration and Movement of Persons
• Intensified Co-operation to Prevent and Combat Common Security Threats
• Greater EU Political Involvement in Conflict Prevention and Crisis Management
• Greater Efforts to Promote Human Rights, Further Cultural Co-operation and Enhance Mutual Understanding
• Integration into Transport, Energy and Telecommunications Networks and the European Research Area
• New Instruments for Investment Promotion and Protection
• Support for Integration into the Global Trading System
• Enhanced Assistance, Better Tailored to Needs
• New Sources of Finance

This New Neighbourhood Policy would be taken forward via country and/or regional strategic Action Plans developed by the Commission in partnership with the neighbouring countries. Action Plans would include political and economic benchmarks by which to judge progress. The Communication suggests that, once agreed, these Action Plans could supersede common strategies to become the Union’s main policy document for relations with the neighbouring countries over the medium term. When it comes to reflecting integration and liberalisation in contractual relations, the Communication also opens the prospect of new Neighbourhood Agreements, supplementing, where needed, the existing Partnership and Co-operation Agreements and Association Agreements.

Options

What then might be offered in a bilateral framework? There could be reinforced political dialogue with the aim of improving the quality of discussion rather than the frequency of high-level meetings. Russia already has monthly meetings with COPS to discuss CFSP/ESDP issues. There could be closer economic cooperation bearing in mind the problems that PCA and Euro-Med countries have had in fulfilling existing agreements. It should also be noted that the above agreements contain provision for eventual free trade areas. An important stepping-stone will be WTO membership (only Moldova is in the WTO), especially for Russia, and there could be scope for additional assistance in this area as well as assistance to the progressive approximation of EU norms and standards. It should also be noted that discussions have started with Russia on the idea of a common European economic space. But the Russian ideas so far amount to pressing the EU for more market access and for more European Foreign Direct Investment (FDI) in Russia. There could be some increased financial assistance with the focus on JHA and cross-border cooperation. There could be a greater role for the European Investment Bank (EIB). And there could be gradual integration into some EU policies such as consumer protection, competition policy, research, education, culture and the environment.

There could also be more twinning arrangements building on the experience under the Phare programme. NGOs, business, local authorities and the academic world could play a stronger role. The EU might also develop the concept of lead states taking responsibility for assisting the reform process in selected neighbours. Poland already plays an important role in Ukraine.

The above could all be done within the framework of existing contractual agreements. But there is an argument that some new agreements which might involve only cosmetic change e.g. Neighbourhood Agreements, could boost the reform process in countries such as Ukraine and unlock additional political will and administrative capacity. They could include clear benchmarks for reform and incentives to attain them e.g. further trade liberalisation. The danger is that the process of negotiating and ratifying new agreements would distract from the need to concentrate on substantive measures. It is also difficult to envisage a trouble-free ratification process of any new agreement with President Leonid Kuchma in power in Ukraine (and Mr Lukashenko in Belarus).

Conclusion

In the absence of any consensus on definitions, the debates on the limits of Europe and the related, confused, concept of the Wider Europe are likely to continue for some time. There will be further enlargements of the EU but it is difficult if not impossible to set a timetable or to agree now on the final borders of the Union. It is highly likely that there will be major problems of ‘digestion’ with the current enlargement and that the resulting difficulties could lead to a slippage even of the 2007 target date for the next wave. The EU can only proceed on the basis of a pragmatic approach considering each country on its merits. There cannot be a one-size-fits-all arrangement although there clearly needs to be more regional cooperation, especially in the Balkans and Mediterranean. The EU will need to continue and indeed intensify its relations with all its neighbours but this will have major resource implications. In the end, progress on institutional relations with the EU will depend upon progress made by individual countries.