Egmont papers

The EU has proved unable to absorb, let alone improve upon, three things from WEU’s legacy: the true collective defence guarantees of the MBT, the openness to Turkey and other non-EU Allies, and the maintenance of a specialized parliamentary assembly for defence and security (which will be replaced, at best, by a much weaker inter-parliamentary network). In all other respects European defence and security cooperation has clearly fared much better under the EU’s wing than it ever could in WEU, producing more than 20 actual crisis operations for a start. If the EU now finds itself unable to move further, there are at least two possible hopeful readings of the post-WEU situation. One is that the EU and its members will be spurred to greater and more integrated defence efforts by some future set of challenges, distinct from 20th-century territorial warfare. The other reading is that the EU’s nature, values, longer-term survival and true security potential are better served without a ‘hard’ military personality. The kind of European defence that WEU and its Treaty stood for has proved elusive after nearly 60 years of effort: could it also be, in the final analysis, unnecessary and undesirable?

n°45: The treachery of strategies: a call for true EU Strategic Partnerships, Thomas Renard, April 2011.

résumé: Executive summary

In September 2010, the European Council discussed for the first time the European Union’s (EU) strategic partnerships, a foreign policy concept that was until then unknown to most people – including EU officials. This discussion was certainly needed in these times of geopolitical upheaval. The global shift of power from the Atlantic to the Pacific forces the EU and its Member States to fundamentally rethink their foreign policy with a strong focus on great and emerging powers; otherwise the EU is at risk of falling into global irrelevance. The 2009 Copenhagen climate conference was just a foretaste of what global irrelevance could mean. The recent events in the Arab world have proved again that Europe is not at ease with contemporary challenges, including in its own neighbourhood.

To cope with the coming multipolar world, the EU should invest time and energy in its relationships with great and emerging powers, i.e. in the so-called strategic partnerships, because the more the world becomes globalised and interconnected, the more the EU will be confronted with them – a confrontation that can lead either to cooperation or competition. Given that all international actors need one another if they are to cope with issues as crucial as climate change, nuclear proliferation and sustainable development, cooperation should be privileged over competition. Current events in the Arab world – as important as they are – should not distract the EU from its vital long-term strategic interest: secure a relevant status in the coming multipolar environment dominated by great powers.

On the basis of a review of EU documents, official and informal, as well as a certain amount of interviews with European officials, this paper concludes that the EU has today, in 2011, ten strategic partnerships with third countries: Brazil, Canada, China, India, Japan, Mexico, Russia, South Africa, South Korea and the United States. However, it is not entirely clear what is the exact reasoning behind this list. Some countries (e.g. the US) are considered to be natural partners of the EU, whereas others (e.g. China and Russia) are considered simply to be too big to ignore. As for the other countries on the list, the strategic rationale is far less evident. Their inclusion sometimes seems to be more the result of political and institutional games than of a true strategic reflection, hence leading to an “accidental” list of strategic partners.

The objectives that the EU is supposed to pursue globally through its strategic partnerships are left entirely undefined. What are the EU’s global interests and priorities? How can these interests and priorities be pursued? What is the role of the strategic partners (cooperation or competition) in the pursuit of these interests and priorities? The 2003 European Security Strategy remains mute on these fundamental questions, as it says more about how to do things than about what exactly to do. Strategic partnerships thus unfold as instruments empty of meaning and substance, with no clearly defined strategic direction.

Strategic partnerships are only strategic in name, for now. A historical overview of documents and debates shows the total absence of strategic rationale behind the elaboration of strategic partnerships since the very beginning, with no definition of the concept or of its fundamental objectives, and an ad hoc selection of partners. This process of a-strategic thinking led to a repetition of past failures as the EU is now facing similar problems as it was ten years ago with the Common Strategies, from which the partnerships derived, namely the difficulty to turn rhetoric into concrete policies of strategic value vis-à-vis our partners. A set of interviews with EU officials and European diplomats confirmed that strategic partnerships are to this day empty of any substance. This paper demonstrates that strategic partnerships are not so strategic when looked at up-close for a variety of reasons, including that 1) not every partner is equally strategic; 2) the EU is not cooperating with its partners on most truly strategic issues; 3) the strategic partnership has no structural or institutional impact on the relationship; 4) or, finally, the EU itself is simply not considered as a strategic partner in many cases.

This paper concludes that the recent revival of debates on strategic partnerships is a positive step forward and that a strict implementation of the important conclusions of the 2010 September European Council is now awaited. Overall, this paper recommends reflecting on the EU’s global interests and priorities in search of the EU’s grand strategy. True strategic partnerships, as this paper brands them, could then be regarded as (sub-)strategies of the EU vis-à-vis great and emerging powers. In addition to this general recommendation, this paper makes several recommendations for the EU and its Member States to turn the existing strategic partnerships into true strategic partnerships:

Review the EU’s institutional set-up, in line with the strategic nature of the partnerships, e.g. by establishing a cell dedicated to the strategic partnerships within the EEAS, or by developing the EU delegations in terms of size and composition to reflect the strategic character of the relationship.

Review the EU’s internal arrangements, notably ensuring a greater coordination between the EU and the Member States vis-à-vis strategic partners.

Review the bilateral arrangements between the EU and its strategic partners in order to acknowledge the strategic importance of the relationship, e.g. by establishing comprehensive and effective strategic dialogues as well as sectoral dialogues on security and defence, or by developing a culture of cooperation on strategic issues.

Review the multilateral arrangements, according to the EU’s preference for effective multilateralism, e.g. by boosting coordination and conflict mediation mechanisms within multilateral forums between the EU and its strategic partners.

n°44: Renewed Financial Supervision in Europe – Final or transitory?, Stijn Verhelst, March 2011.

résumé: Executive summary

The financial crisis underscored both the importance of financial supervision, as well as its pre-crisis malfunctioning. In response, substantive reforms have been carried out in Europe and elsewhere. This paper discusses the renewed financial supervision system in Europe, which fully entered into effect in January 2011. It examines supervisory reforms at the EU-level and considers the role of national, cross-border and international supervision.

The paper finds that the reforms undoubtedly lead to a strengthening of EU powers, both by the creation of an EU macro-prudential supervisor (the European Systemic Risk Board) and the reinforcement of three EU micro-prudential supervisory bodies (the European Supervisory Authorities). The EU’s role will even grow over time. The role of cross-border and international supervision has equally increased. Nevertheless, the heart of financial supervision remains firmly at the national level, as national supervisors conduct the bulk of supervisory tasks. Such Member State dominance is in sharp contrast with the state of EU financial sector integration. Yet, a substantial shift to EU supervision is currently unfeasible, due to legal constraints and to Member States’ financial sector crisis management responsibilities.

The inability to align financial supervision with financial sector integration could result once again in supervisory failings. If so, a difficult choice between genuinely europeanising financial supervision (with the subsequent legal and fiscal implications) or cutting back the single market arises. The paper concludes that while the renewed supervisory framework is far from perfect, policymakers should strive towards making it work – or be prepared to take uncomfortable decisions.

n°43: The Single Market in need of a strategic relaunch, Tinne Heremans, Feb. 2011.

résumé: On the 27th of October 2010 the Commission finally published its long-awaited

Communication “Towards a Single Market Act”2 with the ambitious objective

of relaunching the Single Market. It is beyond doubt that the market integration

project is indeed in need of a serious boost. On the one hand, the “acquis”

should be buttressed more firmly against protectionist reactions, citizen distrust

and integration lethargy more generally. On the other hand, the untapped

growth potential – in domains suffering from persistent bottlenecks as well as in

new sectors – needs to be better exploited. It will however be argued in this

contribution that, in its present form, the Commission’s “Draft Single Market

Act” (Draft SMA) does not contain all the strategic building blocks needed to

address the key challenge of reengaging the different actors in the market integration

project and genuinely revamp the Single Market. Therefore, on the basis

of an examination of the gaps and defaults in the Draft SMA’s approach, and

against the background of the preparatory documents presented by Mario

Monti3 and the European Parliament4, some suggestions for possible strategic

improvements to be included in the final SMA will be made.5

Hence, this contribution will first set out the main points of the Draft SMA and

the most important preparatory documents, focusing primarily on the strategic

elements contained therein. In a second part, a critical appraisal of the Draft

SMA’s strategic approach will be provided, followed by some suggestions for

improvement.

n°42: A new Geography of European power?, James Rogers, Jan. 2011.

résumé: The naval historian and geostrategist, Alfred Thayer Mahan, understood the

utility of military power perhaps better than anyone before or since. In an article

called The Place of Force in International Relations – penned two years before

his death in 1914 – he claimed: ‘Force is never more operative then when it is

known to exist but is not brandished’ (1912: p. 31).1 If Mahan’s point was valid

then, it is perhaps even more pertinent now. The rise of new powers around the

world has contributed to the emergence of an increasingly unpredictable and

multipolar international system. Making the use of force progressively more

dangerous and politically challenging, this phenomenon is merging with a new

phase in the proliferation of weapons of mass destruction. At the same time,

many European governments are increasingly reluctant – perhaps even unable –

to intervene militarily in foreign lands. The operations in Afghanistan and Iraq

have shown that when armed force is used actively in support of foreign policy,

it can go awry; far from re-affirming strength and determination on the part of

its beholder, it can actually reveal weakness and a lack of resolve. Half-hearted

military operations – of the kind frequently undertaken by democratic European

states – tend not to go particularly well, especially when there is little by way of

a political strategy or the financial resources needed to support them. A political

community’s accumulation of a military reputation, which can take decades, if

not centuries, can then be rapidly squandered through a series of unsuccessful

combat operations, which dent its confidence and give encouragement to its

opponents or enemies.2

Nevertheless, since the Wars of the Yugoslav Succession in the 1990s, there has

been a strong belief that Europeans need to be more willing and able to use

armed force. Indeed, the constitution and development of the Common Security

and Defence Policy was in many respects a reaction to the Yugoslav bloodbath

(Rogers, 2009a; Shepherd, 2009). To this end, the European Security Strategy

asserts that the European Union needs a ‘strategic culture’, which fosters ‘early,

rapid and when necessary, robust intervention’ (European Council, 2003:

p. 11).3 Brussels has subsequently conducted a series of small and seemingly

experimental ‘crisis management’ operations in a range of countries, whose

crowning glory has been the anti-piracy naval operation in the Gulf of Aden,

Atalanta. Yet, excepting those in the Western Balkans, almost all of these operations

share a common theme: they have been heavily reactive and/or lack geopolitical

focus. For example, while Europeans were militarily engaged in distant

Sub-Saharan Africa during August 2008, a war broke out in the European

Neighbourhood in a potential transit corridor for the planned Nabucco gas

pipeline – which aims to bypass Russian territory and reduce European gas

dependency. Likewise, it took almost two years of rising pirate infestation

around Somalia – on the main European-Asian maritime communication line –

before Europeans got directly involved. This lack of geopolitical focus is a consequence

of an outmoded European geostrategy, which fails to integrate the

maritime with the continental component (Rogers, 2009b; Rogers and Simón,

2009). Equally, it is driven by a dearth of European grand strategy, the hardening

of which would draw together the European Union’s means and wherewithal

to overcome foreign threats and challenges, while simultaneously working

for the pursuit of common objectives (Biscop, 2009; Biscop, et al., 2009;

Venusberg Group, 2007).

The aim of this paper is to offer an analysis of the geography of European power

in the early twenty-first century. It will begin by looking at the sub-components

of grand strategy: geopolitics, geostrategy and forward presence. This will be

followed by an analysis of the European Union’s geopolitical situation, something

that is frequently overlooked in contemporary European politics. The

improvement and further integration of the European homeland will bolster the

European Union as a base of power, which itself could then be exploited á la

Mahan to diffuse awe into foreign governments and make them more respectful

of European preferences. Most importantly of all, though, the paper will show

why and how the European Union should focus less on disjointed ‘crisis management’

operations and more on the quiet and covert expansion of its political

and economic power into geographic locations of particular significance (see

Figure 1). The paper will identify these locations as the proximal belt of surrounding

countries, buttressed by overseas maritime zones that are of specific

importance to the European economy. Acquiring influence in such regions will

necessitate the final completion of the ‘comprehensive approach’ through the

creation of a European ‘forward presence’: firstly, to deter foreign powers from

meddling in countries in the wider European Neighbourhood and secondly, to

dissuade obstinacy and misbehaviour on the part of local rulers.4 In other

words, a truly comprehensive European grand strategy should be inculcated

with a grand design: the constitution of an extended ‘Grand Area’, a zone where

European power would be progressively institutionalized by the dislocation of

existing divisions and their reintegration into a new liberal order. By reducing

the likelihood of having to use military force reactively, it would better connect

with the conception of preventative engagement as outlined in the European

Security Strategy (European Council, 2003: p. 11). And by filling political vacuums

with the gradual expansion of European power, conflicts could actually

be prevented from breaking out before they start or spiral out of control – and

thus stifling the potential for dangerous ‘vacuum wars’.5

n°41: EUnity of Command - The Planning and Conduct of CSDP Operations, Luis Simón & Alexander Mattelaer, Jan. 2011.

résumé: With the aim of contributing to the debate about the agenda of the forthcoming

Polish Presidency of the EU in the second half of 2011, in November 2010

Egmont organized an international expert seminar in Brussels with its sister

institute from Warsaw, PISM – the Polish Institute of International Affairs,

under the heading Crisis Management Operations: European Lessons Learned.

The EU has undeniably become an important actor in the field of crisis management.

In view of its expertise and its capabilities, the demand for CSDP operations,

both civilian and military, can only be expected to increase. The EU is also

reshaping its institutional architecture and its procedures for crisis management.

The establishment of the Crisis Management and Planning Directorate (CMPD)

and its integration into the External Action Service (EAS) are determining for

the future shape of EU crisis management. As this re-engineering of the CSDP

machinery is in full swing, the moment is right to take stock of crisis management

operations so far and identify lessons learned, in order to inform decisionmaking

in the very near future.

To that end, the seminar addressed three key dimensions of EU crisis management:

– The comprehensive approach: To which extent does the EU really implement

a comprehensive or holistic approach both in theatre and at the Brussels

level? Which conclusions can be drawn for the running of operations and for

the training of relevant staff?

– Command & control: How effective have command & control arrangements

proved, in the various stages of mounting and running operations, at

the various levels of the chain of command?

– The Battlegroups: While they have so far never been deployed, as a rapid

reaction capacity they do constitute an important part of the CSDP toolkit,

of which the EU arguably could use more. How can the Battlegroups be

adapted to current needs?

In this Egmont Paper, the Institute publishes two very thought-provoking contributions

about command & control, based on the presentations by the two

academics who addressed the seminar on that topic.1 Dr. Luis Simón and Alexander

Mattelaer focus respectively on the planning and the conduct of CSDP

operations. Their creative thinking on these topics constitutes an important con-

tribution to a debate which will feature prominently on the EU agenda in 2011.

Egmont is very proud and happy to be able to publish the work of two such fine

colleagues.

n°40: The EU’s Emissions Trading Scheme: achievements, key lessons, and future prospects, Clémentine d’Oultremont, Dec. 2010.

résumé: This paper analyses the lessons learnt so far from the EU ETS in order to have a better perspective of its future. Despite the diverse achievements of the scheme, it is still far from having fulfilled its theoretical potential. Although it has been proven that the EU ETS led to abatement during the first phase, carbon prices have remained too low to promote investments in the development, diffusion and deployment of low-carbon technologies. Yet, if the EU wants to achieve the long-term challenge of ‘decarbonising’ its economy, a credible and long-term carbon price is needed to insure green investments. By reducing industrial production, the economic recession has certainly reduced emissions but has also ensured that carbon prices stay low in the forthcoming years. In order to ensure the credibility of the scheme, the EU ETS must be unilaterally revised towards an objective of 30% emission reduction by 2020. This would not only correct the negative consequences of the economic recession on the scheme but would also boost investment in the development of green technologies.

n°39: Addressing the financial crisis: the EU’s incomplete regulatory response, Stijn Verhelst, Dec. 2010.

résumé: -The financial crisis and its massive impact on the real economy revealed numerous shortcomings in the regulatory framework. The EU committed itself to recast its financial regulation, which should result in a sound and secure financial system. This Egmont Paper provides an analysis of the EU’s regulatory reform.

n°38: The EU Climate Policy after the Climate Package and Copenhague - Promises and Limits, Franklin Dehousse and Tania Zgajewski with the collab. of Karel Van Hecke, Sept. 2010.

résumé: Executive summary

This paper aims to provide a global assessment of the European Union’s climate change policy after the Climate Package and Copenhagen. In order to do so, the paper firstly describes the climate threats for Europe as well as the birth and objectives of the EU climate and energy package adopted in 2009. Then, the different components of this package are highlighted: the EU Emissions Trading Scheme (ETS), the obligations of the non-ETS sectors, the 20% renewable energy objective, the promotion of carbon capture and storage and the framework on environmental subsidies. Thirdly, the other EU climate policy legislations are examined, comprising: energy efficiency, the GHG emissions of cars, the GHG emissions of fuels, and the Strategic Energy Technology Plan (SET-Plan). Next, adaptation to climate change is discussed, before examining the international aspects of the EU actions after Copenhagen. As a way of conclusion, the paper assesses the EU climate policy throughout four main questions: What has the EU achieved until now? What will be the costs? What will be the impact on the European Union? And, is the EU action sufficient?.

n°37: A strategy for CSDP. Europe’s ambitions as a Global Security Provider, Sven Biscop and Jo Coelmont, Oct. 2010.

résumé: The entry into force of the Lisbon Treaty constitutes an important juncture for the EU, which merits a strategic reflection about the objectives and priorities of CSDP. When and where should the EU contribute, or even take the lead, in conflict prevention, conflict resolution and crisis management, with its full range of diplomatic, civilian and military instruments? That ought to be determined by a more complete European Security Strategy (ESS) – the grand strategy – that outlines the EU’s fundamental objective and its vital interests, by the foreign policy priorities flowing from that grand strategy, and by the EU’s specific interests and objectives vis-à-vis an issue or region.

On this point, EU strategic thinking is the least explicit. While there are many strategic documents elaborating on various dimensions of the ESS – e.g. on the Neighbourhood, on Africa, on WMD, on terrorism – there is no specific strategy for CSDP. Hence there is a missing link between the vague yet ambitious goal expressed in the ESS – “to share in the responsibility for global security” – and the practice of CSDP operations and capability development. Because the overall goal of the ESS has not been translated into clear objectives and priorities, CSDP to some extent operates in a strategic void. The guidance that does exist, offers only some elements of strategy: it concerns form rather than substance. The Petersberg Tasks give an indication of the types of operations that the EU can undertake, and the Headline Goal of the scale of the capabilities that Member States are willing to commit – but that does not tell us when and where the EU needs to intervene. Furthermore, as we shall see, even about the types of operations and the scale of the effort, some ambiguities are consciously kept alive by certain actors.