After Iraq: the EU and global governance.

Cameron, Fraser

One of the central motivations for the Convention on the Future of Europe was to devise a way for the European Union (EU) to play a stronger and more effective role on the world stage. In spite of the Union's leadership on Kyoto, the Doha Development Round, and the International Criminal Court (ICC), a widespread feeling existed that the EU was still not pulling its weight. As the convention entered the home stretch in the spring of 2003, the Iraq crisis exposed deep divisions in the Common Foreign and Security Policy (CFSP). This prompted some critics to ask if the EU should continue with its global pretensions.

In this article, I suggest that the draft constitutional treaty produced by the convention provides only a shaky basis for a more coherent external policy. However, the Iraq crisis, as with previous crises, is likely to galvanize the EU toward a more prominent and effective role on the world stage, especially in strengthening the multilateral institutions of global governance. This was clear as EU member states welcomed the security doctrine presented by Javier Solana, the EU's high representative for CFSP, in June 2003. (1) A central theme was the need "for effective multilateral institutions." Solana did not define "global governance" but emphasized the importance of "a rules-based international system." (2) Long before Iraq, the EU was on an opposite track from the United States in this arena. Washington had a dismal record with regard to UN financing, the rejection of the Kyoto protocol, efforts to destroy the ICC, and the refusal to ratify a host of arms control treaties, notably the Comprehensive Test Ban Treaty (CTBT). The present Bush administration's "a la carte multilateralism" at least has the advantage of truth in packaging.

Partly because of its own history and constant intergovernmental negotiations. Brussels has been more willing than Washington and many other countries to work through multilateral institutions. The EU itself is an example of multilateralism at work. The United States has never learned to share sovereignty as Europeans have and is often suspicious of such arrangements. The importance of multilateralism was emphasized in the many contributions during the convention debates. The draft treaty contains a number of proposals aimed at strengthening the EU's external representation. These include the new post of foreign minister, a stronger role in international organizations, a diplomatic service, and a potential single voice for the European Monetary Union (EMU, or eurozone). With the failure of the Brussels European Council in December 2003 to agree to the new treaty, there will be some delay before the Intergovernmental Conference (IGC) is concluded.

The EU faces the twin challenges of speaking with one voice whenever possible and nudging the United States back into the multilateral fold. As the former is a necessary precondition for European effectiveness in addressing the latter, this essay addresses the obstacles Europe confronts in its effort to build a coherent foreign and security policy. It discusses the EU's multiple and overlapping lines of authority and then examines how the EU's complex mandates and decisionmaking structures play out within several key international institutions and functional areas.

Underlying many of these other problems are continuing differences between member states on major issues before multilateral institutions and disagreements about the extent to which the states constituting the EU should transfer or retain their sovereign prerogatives.

Who Speaks for Europe?

The EU's external representation varies depending on the policy area--CFSP, trade, financial, economic, environmental, and development affairs. (3) Every six months the U.S. secretary of state has a new European interlocutor. It is little wonder, therefore, that Colin Powell knows Solana's telephone number better than that of whoever among the fifteen (soon twenty-five) foreign ministers is currently holding the presidency of the Foreign Affairs Council. Moreover, when it comes to military action, the first long-distance calls made from Washington are to London, Paris, and Berlin.

In spite of Powell's relationship with Solana, Washington may need to call one of several commissioners dealing with the various aspects of external relations. Washington may also wish to speak to one of the EU's special representatives dealing with the Middle East, the African great lakes, or Kosovo. Thus, depending on the circumstances, the EU may be represented by Solana or the presidency alone, the presidency and the European Commission, or by all three. If the United States, with its lengthy history of close cooperation with the EU, finds the situation baffling, other partners are even more perplexed. The EU and its member states together have by far the largest diplomatic network in the world. More than 40,000 officials work in the foreign ministries of the member states in some 1,500 diplomatic missions. Each member state maintains between 40 and 160 diplomatic missions, while the Commission has a network of over 120 delegations. These numbers will increase significantly as a result of enlargement in 2004. However, there is real uncertainty as to the effectiveness of these resources in the pursuit of European objectives. In comparison, the United States has about one-third of the human resources and one-fifth of the diplomatic missions, but the United States is not less effective than the EU in pursuing its policy objectives.

To what extent will changes proposed in the draft constitutional treaty address these issues? The IGC discussions on the draft treaty began in October 2003. On the external front, the proposed innovations include a new foreign minister (merging the positions of Solana and Chris Patten, the commissioner for external relations), the creation of an armament agency, a voluntary humanitarian youth corps, the establishment of an EU diplomatic service, a mutual solidarity clause, and provisions to enable some countries to act in the name of the EU on defense. These measures should lead to a more coherent EU voice on the world stage, building on the trend of the past decade for member states to agree first on common policies on functional issues. For example, recent steps include Solana's representing the EU at the Quartet meeting in the Middle East, common positions on countries and crises (for example, Russia, Ukraine, Southeast Asia, the ICC, and Kyoto), and peacekeeping missions (Bosnia, Macedonia, and Congo).

The EU and Multilateralism

As Europe's global identity evolves, interaction with other multilateral institutions becomes increasingly important. The UN poses a special problem, because Britain and France are permanent members of the Security Council and are supposed to inform and take into account the views of the EU on matters before the council. (4) Although coordination between EU member states at the UN has improved in recent years, London and Paris are still criticized for pursuing national, as opposed to EU, interests. In January 2003, Spain and Germany began two-year terms as nonpermanent members, but even with four major European states represented there was no unified European voice on the Iraq crisis. The UK and Spain backed the U.S. position while France and Germany opposed it. Although both London and Paris are on record as favoring reform of the Security Council, any restructuring would more likely add more members rather than a single EU seat.

With regard to the Organization for Security and Cooperation in Europe (OSCE), the EU president speaks for the Union when there is an agreed political position. On economic issues, the Commission takes the floor. But member states nearly always exercise their right to speak at OSCE meetings, which dilutes any message. The position of the Union in the Council of Europe is equally weak.

The confused external representation of the CFSP is replicated in many other policy areas, with one notable exception--trade policy--for which the commissioner for trade (currently Pascal Lamy) represents the EU. The advantages of this approach for all member states have been proved from the Kennedy to the Uruguay Round and most recently in the launching of the Doha Development Agenda. The approach is simple. The Council of Ministers agrees on a mandate, which the Commission then uses as the basis for its negotiations with third parties. After agreement is reached, the commission presents the results to the Council for approval. Such an approach could be employed as well for foreign and international economic policies.

In the international financial arena, the shift of monetary policy sovereignty from the national level to the European Central Bank (ECB) in eurozone countries has increased significantly the EU's governance. However, despite the introduction of the euro, the EU is weaker than it should be in international financial forums. This weakness reflects the complicated nature of financial decisionmaking, the incomplete overlap in membership between the Union and eurozone, and the rules of major multilateral financial institutions.

In 1998, the European Council agreed to rather complicated guidelines regarding the EU's external representation in financial forums. For meetings of the Group of 7 (G7) finance ministers, "the president of the ECOFIN Council (5) or if the president is from a non-euro area member state, the president of the Euro 11, assisted by the Commission" participates. Union views on issues of particular relevance to the EMU would be presented at the board of the International Monetary Fund (IMF) by "the member of the executive director's office of the member state holding the euro presidency, assisted by a representative of the Commission." For matters bearing on economic and monetary union, the European Council's conclusions encouraged the Commission, Council, and member states to prepare common positions for presentation in international forums, but it was recognized that this might be hindered because such bodies were not fully associated with the preparatory processes of international meetings. (6)

The situation of the EU in the G8 is also weak. Although European representation is top-heavy with the UK, France, Germany, and Italy along with the European Commission and the presidency (when it is not held by one of the Big Four), these very numbers are a demonstration of the EU's inability to speak with one voice.

So far, ad hoc solutions to external representation have prevailed for the IMF, G7 or G8 meetings, the Financial Stability Forum, the G-20, and other such groupings where topics pertinent to the EMU are discussed. However, member states have begun to realize that if Europe is to have an effective international voice, these solutions are inadequate. There is also increasing pressure from emerging markets and non-European G7 countries for streamlining EU representation in bodies such as the IMF. (7)

Institutionally, however, less progress has been made. In the IMF and World Bank, the EU's position is complicated by the incomplete membership of the eurozone. The influence of the EU is hampered by institutional membership criteria: The 1945 IMF Articles of Agreement confer on states the right to membership. Furthermore, the IMF decisionmaking process, with countries grouped in mixed EU/non-EU constituencies, can sometimes be at odds with the Union's need to respect its treaty requirements on position taking and representation.

Under the Articles of Agreement of the World Bank, a country must first join the IMF before it may become a member of the Bank. This limits the EU's capacity, as an organization of states, to act collectively. In addition, as with the IMF, World Bank voting constituencies are organized along lines that sometimes mix EU and non-EU groups.

This situation is clearly confusing and should change. Ultimately, there should be a single EU seat in the Bretton Woods institutions. Some argue for a gradual approach, placing the emphasis on improved coordination in Washington. Others suggest that, as issues concerning EU competence increasingly dominate the IMF agenda, Brussels should play a more prominent role through the ECOFIN and discuss IMF issues at its regular meetings, thereby adopting common positions. A further complicating issue is Britain's absence from the eurozone. However, the draft constitutional treaty put forward by the convention does provide for the possibility of EMU members agreeing on their own external representation. A step toward this goal might be a joint Franco-German seat, initially at the IMF and elsewhere, as these two countries have traditionally been pioneers in European integration.

Environmental policy is an area of mixed competence between the EU and the member states that exposes the limitations of the rotating presidency. International environment negotiations usually last several years but the presidency only six months. Moreover, as with the CFSP, there are substantial differences among member states in their capacity to conduct negotiations on environmental issues. There are also substantial differences of opinion among member states on the role of the Commission in this arena. Some members favor giving the Commission a negotiating mandate, as in trade policy, but others are opposed.

The result, again, is distinctly ad hoc. In the negotiations on climate change and in the implementation of the Kyoto protocol, the presidency negotiates on behalf of the EU, although the Commission plays an important role on particular issues that need to be harmonized. A number of informal arrangements have been put in place to maximize the EU's impact in international environmental negotiations, to facilitate preparations, and to ensure continuity. In the Commission on Sustainable Development (CSD), the EU has adopted a "lead-country approach." In the biosafety negotiations, the "EU-team" approach has been embraced. These examples are catching on in other fields and are likely to become the norm in an enlarged Union. For example, the Netherlands and Sweden presided over negotiations in the CSD for longer than one presidential term.

Conclusion

The external representation of the EU is a complicated process that is likely to undergo change as a result of the proposals tabled by the convention. The EU is gradually increasing its profile in the world, and more and more countries are looking to Brussels for leadership. Yet there are clear challenges to more effective participation in international bodies. The first challenge is to develop an effective and coherent representation within bodies that were set up for a membership comprising only states. Second, there are challenges for reaching common EU positions on the economic and financial as well as political front. For example, the EU has been largely invisible in international efforts to deal with recurrent financial and banking crises caused by the sharp swings in capital flows in emerging markets. In this area, no distinct EU position has been developed and defended, even in cases where Europe's strategic interests are clear (for example, Turkey). In contrast, the United States usually has well-defined positions and is highly effective at influencing multilateral bodies such as the IMF.

Another challenge is enlargement. If twenty-five member states can speak with one voice, then clearly the Union's influence on the world stage will increase. But the Iraq crisis revealed deep differences, and not just between "old" and "new" Europe. The new member states will undoubtedly align themselves, as they have done in the past few years, with mainstream EU policies. They will recognize the value of the EU presenting a unified position. Already, apart from Romania, they have withstood U.S. pressure to sign bilateral agreements on the ICC.

In the end, a Union with 450 million citizens--the largest trading bloc in the world, with a single currency, and the largest provider of development aid and humanitarian assistance--cannot be denied a greater role in world affairs. It will be some time, however, before it speaks with a single voice. Meanwhile, the more it speaks with one voice, the greater the likelihood of leading the United States back to the path of multilateralism.

Notes

Fraser Cameron is director of studies at the European Policy Centre in Brussels.

1. Javier Solana, "A Secure Europe in a Better World," 20 June 2003, available online at http://ue.eu.int/pressdata/EN/reports/76255.pdf (accessed 5 January 2004).

2. For a more comprehensive approach, see Commission of the European Communities, "European Governance: A White Paper," 25 July 2001, available online at http://europa.eu.int/eur-lex/en/com/cnc/2001/com2001_0428en01.pdf (accessed 5 January 2004).

3. See Fraser Cameron, Foreign and Security Policy of the European Union (London: Sheffield Academic Press, 1999), and the respective web pages of the Commission and Council, available online at http://www.europa.eu.int (accessed 5 January 2004).

4. Treaty on European Union, "Title V: Provisions on a Common Foreign and Security Policy," available online at http://europa.eu.int/en/record/mt/title5.html (accessed 5 January 2004).

5. ECOFIN is the meeting of economic and finance ministers of the EU.

6. Vienna European Council, "Presidency Conclusions," 11 December 1998, available online at http://ue.eu.int/newsroom/LoadDoc.asp?BID=76&DID=56427&from=&LANG=1 (accessed 5 January 2004).

7. Private conversation with Commissioner Pedro Solbes.