After almost a year spent trying to contain the coronavirus pandemic, European countries are now facing issues that they had neglected in the months to have the resources and energy necessary to deal with the health emergency, and that they can no longer wait. By the end of 2020, an agreement must be found on the new multi-year budget of the European Union – and therefore also on the so-called Recovery Fund – on Brexit and on the European Green Deal, while in the field of foreign policy it is necessary to agree on an approach to the new American administration of Joe Biden and making important decisions about Turkey.
All while thousands of people continue to die every day from COVID-19, with national apparatuses having to deal with the imminent distribution of the vaccine and averting a potential economic and social crisis triggered by the pandemic. The first occasion to address at least some of these issues will be the meeting of the European Council, that is the body that includes the 27 heads of state and government of the European Union, scheduled between 10 and 11 December.
The most pressing issue, at least for now, seems to be Brexit. The transition period in which the United Kingdom is still part of the European Union expires on 31 December, and negotiations to negotiate a trade agreement between the two parties have been at a standstill for months (and between spring and summer they were slowed down by the fact that both chief negotiators had COVID-19, and that meetings had to be streamed for a long time). The meetings in recent weeks have been unsuccessful, and tonight the President of the European Commission Ursula von der Leyen and the British Prime Minister Boris Johnson will meet to try to unlock the deals.
The trade agreement is 95 per cent ready, European sources say, but for months there has been a gap on three very significant points: the right of European fishermen to access British waters, the mechanism for resolving any disputes and the commitment of the United Kingdom not to subsidize its companies so that they compete unfairly with European ones.
The situation is described as very fluid: “we are in uncharted territory”, he said yesterday von der Leyen’s spokesperson, Eric Mamer. A no deal would be disastrous in the short term for the UK – independent analyzes they talk a reduction in UK GDP of at least 2 per cent in 2021 – but it would also create a lot of trouble for French and Dutch fishermen, for the many German industries exporting to the UK, and for the entire Irish economy. But a no deal it could paradoxically strengthen Johnson’s government, which has been repeating for months that leaving without any agreement is better than finding a “bad” compromise and trying to attribute any stumbling block in the negotiations to the intransigence of the European Union, supported by the main British tabloids.
The outcomes of the meeting considered most likely are two: an agreement in principle that allows the chief negotiators to file the details in the next few days (difficult, but not impossible) or the admission of not being able to find an agreement. In this case, Brexit would become the priority of the European Council on Thursday 10 December.
At the moment, the Council’s priority is another one, which has also emerged in recent weeks: to find an agreement on the multi-year budget 2021-2027 of the European Union.
Negotiations on the new budget began more than a year ago and had already entered a stalemate before the pandemic: on February 20, a first European Council on the new budget it had failed due to the too wide distance between the countries that wanted to expand the budget and the so-called “frugal four”, the more conservative countries from an economic point of view, which instead aimed to leave it more or less unchanged. In the following months the same factions also clashed on the Recovery Fund, only to find an agreement on the entire package at the end of the very long July Council.
Given that the amount of European money at stake between the 2021-2027 budget and the Recovery Fund has almost doubled compared to the 2014-2020 period – 1824 billion compared to 959 – several Western countries have claimed to include a clause in the budget measures that constrains the disbursement of funds in compliance with the rule of law: a huge problem for several Eastern European countries accustomed to distributing funds within their own ruling class, to increase control over local politics and the local economy. Poland and Hungary, two semi-authoritarian-led countries, opposed the new clause and in mid-November they vetoed the entire budget.
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If an agreement is not found by December 31, the European Union will enter a phase of provisional exercise, something that has never happened so far. Until the approval of the new budget, each month will be able to spend one twelfth of the annual amount agreed in 2020 for each expenditure chapter. It means the European Union it will not be able to guarantee the continuity of the most substantial programs, including, for example, those on education and research (Erasmus + and Horizon) and cohesion funds, which are distributed in the poorest regions in Europe, will also be significantly reduced.
For at least two weeks the German government – which manages the rotating presidency of the Council of the EU, the body where the representatives of the 27 national governments sit – has been negotiating to remove the veto of Hungary and Poland. The Commission is also involved in the negotiation, which said it expects news by today: otherwise it will propose to the Council tomorrow to approve the Recovery Fund with an emergency procedure referred to in Article 122 of Treaty on the Functioning of the European Union which provides for special “financial assistance” in the event of “natural disasters or exceptional circumstances”: in short, a Recovery Fund detached from the balance sheet and in which Poland and Hungary would not participate.
Yesterday, Hungarian Prime Minister Viktor Orbán met with Polish Prime Minister Mateusz Morawiecki and said he was optimistic about the possibility of finding an agreement: but it is not clear whether the two countries will be satisfied with a declaration of intent by the Commission to specify that it will examine the respect for the rule of law without prejudice, or if they ask for more money from the budget and the Recovery Fund, reopening a discussion that seemed closed in July.
Hungary and Poland, among other things, are also included among the countries that are getting in the way to the point that until a few weeks ago it should have been at the top of the priorities of the Council of tomorrow: the final agreement on the Climate Law, the pillar of the European Green Deal, a series of measures to make energy production and the lifestyle of European citizens more sustainable. To get it started on schedule by the Commission, i.e. in 2021, the climate law needs to be approved as soon as possible: in recent months, a lot of time has already been lost, since it was originally supposed to be discussed in the European Council in March, then monopolized by the pandemic.
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The Climate Law serves to include in the European treaties the objective of zeroing net polluting emissions across the Union by 2050, which will make the target binding, as well as setting specific intermediate targets. At the moment, the commitment made by the previous Commission included a 40 percent reduction of net emissions, which is now considered obsolete and insufficient. Among environmentalists, the most widespread opinion is that in order to do its part and respect the Paris Agreement, the European Union it should cut emissions by 65 percent.
In September, the European Commission proposed a cut of “at least” 55 percent, leaving the European Council with the task of finding a political agreement between the states. Most of the eastern states still depend on unsustainable energies, and are asking for more margin and more resources to manage the transition: for now in the 2021-2027 budget and in the Recovery Fund, 17.5 billion have been allocated for this purpose, but it is not clear whether the Eastern countries aim to get more money (as both Parliament and the Commission had asked for) or to include among sustainable sources also natural gas or nuclear energy, which, however, would expose the European Union to criticism from environmentalists and renewable energy experts.
German Chancellor Angela Merkel has hinted that she mainly has the first option in mind. On Wednesday 9 December, in a speech to the German Parliament, he said that reaching a compromise on the Climate Law “depends very much on the progress we will make on economic issues”, that is, on the multi-year budget.
Finally, the European Union should find a common approach on two major foreign policy issues: on the relationship with the new US president Joe Biden – on which there shouldn’t be any big arguments in view of an expected rapprochement with the United States – but above all on the possible sanctions to be approved against Turkey.
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For months now, Turkey has adopted an increasingly aggressive attitude in the Mediterranean Sea, conducting explorations in the waters of Greece and Cyprus – an island on which, among other things, it claims territorial sovereignty – rich in natural gas. In October, Turkish explorations resumed, after a pause probably due to negotiations with the Greek government mediated by the German one. “We have not observed any change of direction”, he said two days ago the EU High Representative for Foreign Affairs, Josep Borrell: “in several respects the situation has even worsened”.
For a long time, the European Union has turned a blind eye to Turkey’s aggressiveness in the Mediterranean due to its particular status as a candidate to enter the European Union, a partner in the management of irregular immigration from the Middle East and a country with very strong cultural ties for example with Germany, where a large Turkish community lives.
Today among the countries most in favor of the introduction of sanctions, besides Greece and Cyprus, there is also France: your position was probably influenced by the campaign that French President Emmanuel Macron is waging for weeks now against political Islamism, of which Turkish President Recep Erdoğan is one of the main exponents. However, it is not yet clear whether all the countries of the Union will be willing to approve sanctions – which according to the European treaties must be decided unanimously – and which sectors they should cover: diplomatic sources consulted by Reuters they said that if a deal is found they will likely involve the energy and gas extraction sector.
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