Is the European Union Poised for Relaunching?

The European Union throughout its history has experienced periods of Euro-optimism and periods of Euro-pessimism, with crises scattered in between. Jean Monnet, a pioneering advocate of European unity, wrote that “Europe will be forged in crises, and will be the sum of the solutions adopted for those crises.”

But the recent period of Euro-pessimism has been long and particularly tough: crisis after crisis, each with great destructive potential, along with accumulating external threats such as Putin’s Russia, conflicts in the southern Mediterranean and jihadist terrorism.

It all started back in 2005, when first France and then the Netherlands voted against a treaty to adopt a European constitution. The situation worsened with the start in 2007-08 of the Great Recession, and deepened further still with the 2010 euro crisis. 2016 was a veritable “annus horribilis” for the EU, with Brexit, the election of Donald Trump, and an ongoing refugee tragedy. In the words of Jean-Claude Juncker, president of the European Commission, the EU in recent years has gone through a “true existential crisis”.

Fortunately, things have begun to change over the first semester of this year. The feeling in Brussels is that Europe is back on track and that an EU of 27 member states (without Britain) stands united to face its current challenges and determine its future.

There has been a spate of good news. Election results – in Austria, the Netherlands, several German states and, above all, France – have taken the steam out of the populism that had run rampant across the continent. A Brexit-Trump-Le Pen triumvirate would have been lethal for the EU. Election victories by Emmanuel Macron, a genuine advocate of Europe and of strong relations with Germany, are a determining factor in the re-launching of the EU. Macron’s plans for France involve, precisely, the relaunching of the EU.

At the same time, the EU itself is taking strategic decisions based on a White Paper on the Future of Europe presented March 1, which was followed by the European Council’s Rome Declaration on March 25 that declared its commitment to integrating the continent. The EU is defining its institutional architecture, consistent with a differentiated flexibility, in which there are hard-core countries and more peripheral circles. The Franco-German axis, reinforced by the good relationship between Macron and Angela Merkel, is at the core, which in principle would be comprised of members of the euro zone.

What’s more, the EU is determined to regain its citizens’ support, and to do that it has planned measures in three priority areas: defense and security (both external and internal), immigration (refugees) and economy (fixing the euro’s defects and anti-crisis measures to support investment and growth and fight unemployment). The goal is to make the EU capable of taking decisions in those areas where European-wide policies make more sense than individual measures by member states.

Europe is back and both Brexit and Trump have, ironically, served as catalysts. As for Brexit, activated March 29 by Britain, the EU has already finalized its negotiating plan, which consists of resolving three basic issues before entering into final talks:

1) The situation of EU nationals in the U.K., and that of British nationals in the EU

2) The payment of €100 billion that the U.K. owes

3) Avoiding borders between Northern Ireland and the Republic of Ireland.

The EU’s preparedness comes in sharp contrast to the U.K.’s uncertainty, especially after the early legislative elections called by Theresa May, which have weakened considerably her negotiating position.

As for Trump, the EU has reached important conclusions after his unfortunate recent European trip, as expressed clearly by Merkel: “The time has come for Europeans to take the reins of our future into our own hands.” Merkel has also referred to Britain and the U.S. as being partners who are no longer reliable.

All indications are that the process of relaunching the EU will gather strength after German elections in September. If, as looks likely, Merkel wins for the fourth consecutive time, she and Macron will be key figures in this push. Europe will return to the good days of the Franco-German axis, the outlook is promising and the pro-Europeans are, finally, celebrating. After 12 years of Euro-pessimism, when the very future of the union often seemed doubtful, it’s about time.

About Víctor Pou

Víctor Pou is professor in the Department of Economics. He holds a Ph.D. in law, a B.A. in economics from the Universitat de Barcelona, an MBA from IESE and a post-graduate diploma on European integration from the University of Amsterdam. The extensive work he has carried out for the European Union is reflected in Prof. Pou's numerous publications on European integration and international relations.