IMPLEMENTING LISBON: THE FIRST STEPS
     
Debate on the way forward for Europe.

The Lisbon Treaty has finally come into force, candidates for the new posts that it created have been appointed and the new European Commission has also been designated. Formally at least, the process of institutional reform is thus complete. However, there remain major challenges related to the implementation of the Treaty.

CEPS devoted the Annual Conference on February 25, 2010 to reflect, analyse, put forward solutions for these momentous challenges.
Leading experts and high-level decision-makers stimulated a debate on the topics in a lively and constructive interaction with a cross-section of the European policy circles. This made the brainstorming exercise as insightful and fruitful as possible.

The first full-day conference concentrated on some of the most important developments introduced by the Treaty of Lisbon and prospects for the European Monetary Union. The timely event took place only two weeks after Herman van Rompuy presides over his first European summit and the new Commission was confirmed by the European Parliament and only a few weeks before Catherine Ashton is due to present her proposal for the organisation of the new European External Action Service.

Salon Jerzy Buzek

SquareSquare meeting center


In the course of sessions, assembled panels of experts and policy- makers - including Minister Plenipotentiary for the Polish Presidency of the EU, MEP's, DG Relex European Commission and a Senior Fellow at the Consejo Superior de Investigaciones Cientificas - discussed the role of the new European Council President and its relations with the rotating Presidency, the likely structure and concrete implications of the External Action Service and the prospects for EU energy policy.

Sessions:

  1. The European Council President and the rotating presdency: a clash of powers?

  2. Coping with crises: Prospects for EMU

  3. The European External Action Service: A quantum leap?

  4. Safeguarding the Future: Debating energy security.

The European Council President and the rotating presdency: a clash of powers?

One of the most visible changes introduced by the Treaty of Lisbon is the creation of a permanent President of the European Council. It remains to be seen what impact this new post will have in practice and whether it leads to a higher degree of coherence in EU actions. A lot will depend on the personality of the new President and how he conceives of his role. Will he be an agenda-setter or a Secretary-General of the Council? How will he interact with the Prime Minister of the rotating presidency? What division of labour will he work out with the High Representative for Foreign Affairs and the Commission President? Will he succeed in increasing EU recognition amoung the citizens of Europe?

Also mutual relationships plays a role. There are different views on the matter. Fortunately there were a variety of speakers present about the subject. A total approach to move things forward, but not a totally new approach. However, there is a lack of visibility and readabiity, there is struggle and it is littlebit complicated. It is a matter of protection of interests. A challenge is the attitude of the rotating presidency. The new official Council is complementing the Commission.

Certain is that they will talk about the economic situation, that have to be prepaired together with the present presidency.

meeting room
There is a new institutional equilibrium. More European political rhetorics should come in front. Other players do agree the EU is a strong player on the globe. Mutual there is close contact, but more political will should be provided. The 2020 program is very important, Now it is not what to do anymore, but how to do. In the new situation there will be certainly influence on democracy by the Parliament and shifts from capitals to Brussels.

Read the CEPS report.

The letter below is an appearence of citizens' observations. The tenor of the letter is timely. In spite of the fact that the tenor is mainly based on general known knowledge, the summary and statements can probably be of help to improve the communication between institutions and citizens.
Some profound remarks are centres in the letter: the change from introspection into acting, properties to be a global actor, attention for metaphysical thoughts and also some items for suggestions (framework agreements on relations, mutual cooperation with diplomatic services of the member states, an EU chair at the UN and more political will in order to achieve aims.

F
eeling EUROPE Foundation

To the government of the citizens´ union and union of nation states
Brussels, BELGIUM

24 February 2010.

Re.; A strong Europe of Results; ´Out and in the Cave´.

Not known yet is if there is already a telephone number where foreign governments can call ´the ruler of Europe´. On the other hand, is that really important if the nation states voice together a policy and if that voice become represented by the concerning institution? Then, the meaning is still reached anyway.

Coping with crises: Prospects for EMU

The recent economic troubles in the eurozone have once again brought to the fore some of the inherent limits of the EU economic framework. Shortly after the celebration of its 10th anniversary, analysts and practitioners are questioning the sustainability of the Economic and Monetary Union in its present form. Can it survive without the underpinning of political union? What are the most effective means to ensure fiscal discipline amoung the member states? Should Stability and Growth Pact be revised to focus on different indicators? eurozone members be obliged to bail out partners in difficulty? How can one reduce the moral hazard? Will governments have the political clout to make their national publics accept the sacrifices required to come back from the brink of default?

The euro is not perfect. What to do? Some ideas have been floated yet. (Political) support, an EMF (European Monetair Fund) and a check on national budgets are examples.
Financial markets does not work as common markets: too much transfer of responsibility. A statement was made on the Grecian situation as: 'private debt became public debt', 'current account imbalances', 'the degree of openess' (import and export of goods and services) and 'fiscal adjustment' (simple Keynesian multiplier).

An EMF enforce mechanisms to implement necessary adjustments and recognize sovereign default and financing mechanisms to limit moral hazard, by countries that breach Maastricht criteria have to contribute with amounts related to excess debt / actual debt and excess deficit / actual deficit. There are lessons for new applicants. Cross border activities need also political and regulation thinking. Stability Pact. More economic integration will be better then a traditional bail out.

The European External Action Service: A quantum leap?

Beyond the gloss of the two new top posts, the European External Action Service is arguably the most revolutionary innovation introduced by the Treaty. It is shaping up as a sui generis institution sowing the seeds for potentiallly far-reaching changes in EU foreign relations. This session aims to identify ways of fostering effective cooperation between the seconded national diplomats in the initial phases of the new service and developing an EU diplomatic culture in the long run. Would the creation of an EU diplomatic academy be useful? What changes will the EEAS entail for the structures of the national foreign ministries and their diplomatic representations?

EEAS (and the diplomatic culture) is in progress. But it is not to be expected fully operational in May. It is a long way to go forward. Task were transferred as part of building on excellent external relations on policies. All the EU institutions are involved in the decision making process. The EU is able to speak more with one voice, more agreement between nation states towards policies.

However, foreign affairs policies (energy, climate, global wealth, military) are not simply the policies of the diplomatic services of the nation states. The matter is how to built an European structure that reflect level of the nation states.
The EU took over an UN chair, but not a chair with the same status as that of the member states. Important now is not to loose agenda setting.

This paper describes the key economic variables and mechanisms that will determine the adjustment process in those euro area countries now under financial market pressure. (Greece, Ireland, Portugal, Spain and ItalY = GIPSY).

The key finding is that the adjustment will be particularly difficult for Greece (and Portugal)
because these are two relatively closed economies with low savings rates. Both of these countries are facing a solvency problem because they combine high debt levels with low growth and high interest rates.

Fiscal and external adjustment is thus required for
sustainability, not just to satisfy the Stability Pact. By contrast, Ireland and Spain face more of a liquidity
than a solvency problem. Italy seems to have a much better starting position on all accounts.

Fiscal adjustment alone will not be sufficient to ensure sustainability. Without significant reductions in labour costs, these economies will face years of stagnation at best. Especially in the case of Greece, it is imperative that the cuts in public sector wages are transmitted to the entire economy in order to restore competitiveness, and thus ensure that export growth can become a vital safety valve.

Without an adjustment of wages in the private sector, the adjustment will become so difficult
that failure cannot be excluded.

Safeguarding the Future: Debating energy security.

Energy policy and its geo-political dimension have shot to the top of the EU's agenda in recent years, so it is only natural that the Treaty should upgrade the Union's action in this field from mere measures to a fully-fledged policy. Article 194 stipulates that the policy should be conducted in a spirit of solidarity between member states, but then leaves to them the 'right to determine the general structure of (their) energy supply'. Against the background of rising energy costs and increased competition for energy sources, can these two be reconciled? To what extent will the entry into force of the Treaty affect the attempts by the EU to devise a common energy strategy? What will be the impact on the Union's relations with its neighbours?

There is a bridge between energy policy and climate change. Important is to strive after low carbon energy systems. Concerning energy, energy security, supply (northstream, southstream, Nabucco) and efficiency for the EU is in front. Solidarity is needed. On this item, there is development to speak with one voice. The EU is the largest purchaser. What does it all mean for the EU and energy policy? Attention for sources, supply (pipelines), climate change, efficiency, financing, pricing, but also Russia's reliability.


Speech by Professor Jerzy Buzek, President of the European Parliament to the Centre for European Policy Studies (CEPS)

Brussels - Thursday, February 25, 2010

Dear Onno Ruding,
Dear Daniel Gros,
Dear Colleagues,
Dear Friends,

Thank you for inviting me to address you this evening. I much appreciate the honour and opportunity to join you for your annual dinner. I wish, if I may, to address you on a topic I find particularly important - energy policy and energy security. I will, of course, be delighted to answer any questions on this - or indeed any other topic -

Ladies and gentlemen,
As you may know, I have been arguing for quite some time that we need to strengthen our cooperation in the energy sector. During my very first speech as President of the European Parliament in September last year, I suggested that we might create some kind of 'European Energy Community'.- a new 'EEC'. I also have raised this question with heads of state and government at the last two meetings of the European Council. I know that this is a highly sensitive topic, because energy is very much seen as integral to national security, and therefore it touches directly on issues of national sovereignty.  But I believe that in an increasingly globalised world, we are no longer sovereign when it comes to issues of
energy.

Secondly, as Daniel Gros from CEPS has pointed out, we have to ask whether the interests of big energy companies - say, EDF, RWE or BP are necessarily the interests of France, Germany or the United Kingdom ? If protecting national champions was our policy, then we would never have managed to complete the Single Market?

Dear Friends,
Europe is faced with competition from other parts of the world, competition for access to scarce resources.  
The EU 27 currently uses about 15% of the energy resources of the world. The United States consumes 19% and China 16%. By 2030, our energy consumption will probably have increased by over 10%. At a global level it will have increased by 45%.
Europe's import dependence continues growing - it will reach 67% in 2030, up by 14 % from today's level.  In twenty years time, we will be importing 95% of our oil and 84% of our natural gas.
It is clear that, whatever happens, we will need to continue with diversification of energy. We should invest more in domestic sources, in renewables such as wind and solar power. Nuclear power will be part of the mix, as will be the second generation of cleaner fossil fuels.
The EU has committed itself to promoting a series of large scale energy interconnectors. But where is the money going to come from? We will have to make some hard choices.
Can the individual member states any longer afford the billions of euros which will be needed to build the ambitious energy infrastructure of the 21st century? An infrastructure based not only on pipelines but also on smart grids.
Equally, is it still rational or efficient to conduct 27 bilateral negotiations with oil and gas producers? I do not think so.

I have always argued for the "Community method". Even when I was Prime Minister, and Poland was a candidate country. I think energy is a clear case where a European strategy, and a joint European solution - a Community solution - makes sense.

Dear Colleagues,
A Community shares certain values, customs and habits. It is a high-trust society. We need such trust if we are to pool sovereignty and make common decisions for investment, or purchasing, in such a sensitive area. We have to trust that there will be solidarity not only when things go well, but also when they go less well - when we are faced with a crisis.
Ultimately, our citizens do not care who is responsible for energy supply, provided the lights work when they switch them on. And they do not want to pay large sums of money for that privilege every month !

How could such an Energy Community look like in practice, and what has to be done to achieve this?
A lot of work has already been done on this issue by Jacques Delors and his Notre Europe think tank in Paris. They will publish an important report on the topic within the coming weeks.

I believe a step by step approach needs to be taken. For a start, we could create an oil and gas purchasing group. This would speak with one voice to the outside world. Countries which are members would be able to negotiate joint supply contracts, better share the gas and oil delivered, and start to built a joint stocking and transport infrastructure.
Secondly, we should encourage regional integration among member states, or groups of member states, to create cross-border energy links and connectors.
Third, more importantly, somebody has to take political ownership and show genuine leadership on the issue.

How we face these challenges, individually or as a Community, will only determine how successful we will be.

Ladies and Gentlemen,
What about institutional arrangements? I believe that a variety of options are possible.
Perhaps, we could negotiate a separate treaty involving all the member states. This Community could be part of our European Union, but existing alongside it as a separate,entity, like Euratom today.
Or perhaps we could do this through enhanced cooperation. On this basis, a sub-group of member states would go ahead further and faster than the rest. Such a possibility is provided for in Article 20 of the Treaty and could be triggered by as few as nine member states.
Or we could try simply to work within the new Article 194 of the Lisbon Treaty, which gives some, limited, new competences to the Union in the energy field.

Whatever solution we find, I believe that this European Energy Community must have an opt-in to allow all member states to join when they are ready. This is nothing new: we currently have it with Economic and Monetary Union and with the European Defence Agency.

Dear Friends,
A European Energy Community could give us the advantages of economy of scale both internally, but also outwards, towards the rest of the world. Internally, it could help the member states to invest in the hugely expensive grids and infrastructure we need to complete the single market in energy. It would also help release funds for research and development in areas such as green technologies and renewables, as well as for greater efficiency of existing technology. It would also create greater legal certainty for our energy companies, giving them the right incentives for long term investment. They need to hear a clearer message from the European institutions about where we wish to go in the field of energy, over the next twenty to thirty years.
Externally, the economies of scale offered by this initiative create a powerful trading bloc. This in turn could enable us to negotiate common purchases of oil and gas, reducing the overall prices of those fuels.

Dear Colleagues,
These are some of the issues we need to grapple with as we think about deepening our European cooperation in the field of energy policy.

It has been a privilege and a pleasure to be able to share some of my initial thoughts with you - as we start this discussion - tonight.
A Chinese philosopher once said that you have to study the past to divine the future.
Sixty years ago this May, the French foreign minister, Robert Schuman, called for a pooling of sovereignty in the core heavy industries of the mid-20th century: coal and steel. We must be just as bold in our thinking, during this anniversary year of the Schuman Declaration.

We need to start thinking about the possibility of a greater pooling of our sovereignty in the energy sector of the 21st century.

We need to think seriously about creating a European Energy Community.

Thank you.