Opening session of the Diplomatic days 2013

date: 04 February 2013

Opening session of the Diplomatic days 2013

“Europe is facing fundamental choices now”

Mr. Didier Reynders, Deputy Prime Minister and Minister of Foreign Affairs, Foreign Trade and European Affairs.
Brussels, February 4th 2013

Excellencies, ladies and gentlemen,

It is no coincidence that we chose “The state of the European Union” as the main reflection theme for these diplomatic days. It is an issue that has kept us busy over the last few years. Globalisation, loss of jobs, the Eurozone crisis, street protests in Athens and elsewhere, cuts and restructuring programmes; culminating with a long awaited speech by Prime Minister Cameron; newspaper columns and pamphlets on European politics with the most diverse messages have succeeded, often expressing some despair and criticism. Those still clinging to the notion that Europe is a distant concept that leaves the citizen untouched, must be living on another planet.

By way of introduction to the discussions and information sessions that will be presented to you this week, I would like to share my belief that the debate on reforming the Eurozone will oblige us to develop a completely new governance model in the coming years for those matters that the Member States and their citizens have entrusted to the European level.

In 2012, an impressive package of reform measures was adopted regarding European economic governance. I am just recalling the most important ones :

- On 2 March, the Treaty on Stability, Coordination and Governance - the “fiscal compact” - was signed; on 1 January of this year, the Treaty came into force for those Member States that had already approved it;
- During the European Council of June 2012, the Pact for Growth and Employment was adopted;
- On 27 September 2012, the European Stability Mechanism (ESM) came into force;
- In the autumn of 2012, the general framework of a single supervisory mechanism for European banks and financial institutions was decided;
- Regarding budgetary coordination, the discussions on the so-called Two-pack made good progress and the negotiations are almost completed.

In other words, a great deal of important work has been carried out. But the job is not finished yet. It is not yet time for leniency, even though the financial markets are undeniably calming down and financing costs for Member States have been reduced significantly, even to historic depths, as e.g. for Belgium. 

At the European Council of December 2012, a road map towards further deepening of the Economic and Monetary Union (EMU) was adopted. This road map was based on proposals from the President of the European Council, Herman Van Rompuy. In his opinion a robust, stable and sustainable monetary union should be built on four building bricks:
- a banking union;
- a budgetary union;
- an economic union;
- an adequate system of democratic legitimacy and accountability.

In December 2012, the heads of government also agreed to elaborate in the first half of 2013 a number of specific elements of this total package, such as
- the drafting of “Contractual agreements for competitiveness and growth” as well as mechanisms of solidarity destined at encouraging their adoption,
- the social dimension of the EMU,
- a better ex ante policy coordination by the Member States.

They are expected to make initial decisions on these items in June. Until then, exploratory discussions and consultations will take place with the various Council formations involved.

As you can see, much hard work is being done on all these issues. I am nevertheless expecting some difficult discussions on all these thorny subjects. Furthermore, the financial situation of a number of Member States remains rather precarious, despite some real improvements.

In time, all these initiatives must together lead to a true economic union, which must form a necessary and essential complement to the monetary union. This was in fact originally provided for at the moment of the creation of the euro in the Treaty of Maastricht. The road ahead is still a long and difficult one, but at least we now have a more precise idea of what it looks like.

Thus far the reinforcement of the European budgetary and economic coordination has included 27 Member States when possible, but sometimes 17, and in a few cases even a smaller (Fiscal compact) or a larger number (growth Pact). This increasingly complex diversification was nevertheless always founded on the idea that all Member States would at some point enter into this economic governance model and that the door would remain open for everyone, at least provided the required conditions were fulfilled.

The past year has also seen a growing insight that a tight economic and financial integration must be accompanied by a reinforcement of the control and democratic legitimation mechanisms. I quote form Herman Van Rompuy's report of June 26, 2012 : " Moving towards more integrated fiscal and economic decision-making between countries will therefore require strong mechanisms for legitimate and accountable joint decision making. Building public support for European-wide decisions with a far-reaching impact on the everyday lives of citizens is essential."

How can we have the various levels of competence interact with one another while at the same time respecting the democratic and transparent character of all decisions made on all levels? The ministers of European affairs devoted a very interesting informal meeting to the subject in Dublin in January 2013.

Federal states are already familiar with this demanding working method: over the years, they have learned to work with a multi-layered decision-making model: the local, regional and national level, mostly with real legislative and parliamentary authority at both the regional and the national level. For these Member States, such as Germany, Belgium, Italy and Spain, the European governance layer is in essence not much more than an additional layer in which every component must gradually find its place.

And so we unavoidably come, through the crisis in the Eurozone, to the heart of the debate on the future of Europe. What institutions are necessary in order for the Union to function better? How can the operations of these institutions be made more efficient? How can they achieve more participation from citizens or from national politicians? How can the diversity of opinions be translated into coherent and efficient decisions? Quite naturally, these questions also have an external dimension: how can the European Union have its voice heard better and more efficiently in the world?

Last year, I had the great pleasure to discuss all these questions intensively with 10 other like-minded Ministers for Foreign Affairs in a group that was brought together at the initiative of the German Minister for Foreign Affairs, Guido Westerwelle.

Since 23 January of this year, the debate on Europe’s future has taken on a new turn. I’m speaking of course about "the speech", given by Prime Minister Cameron in which he indicated how he wants to see the European Union evolve in the coming years and where he confirms his intention to submit these changes to the British citizens in an “in or out” referendum by the end of 2017. Providing of course that the Conservative Party remains in power after the parliamentary elections in 2015.

The British Prime Minister wants an EU that is more, maybe even chiefly, focused on free trade and competitiveness. An EU that, in his vision, should focus on helping the business world rather than making its life more difficult with unnecessarily burdensome regulations. For the rest, the Member States must be able to decide freely which powers they want or do not want to share with one another.

David Cameron’s speech certainly contained a number of interesting aspects and points for attention when it concerns the EU’s competitiveness. I share his concerns on several of this issues.

The problem however is that we require much more from the EU than this minimum programme. A common agricultural policy, a solidary regional development and cohesion policy, internal security, a foreign and defence policy, cultural and educational exchanges, a common area of freedom of circulation for our employees and employers, a common currency are just a few of the important policy areas on which we, Belgium, have been working ever more closely with 26 other Member States, and a few new Member States soon, for many years now. We do this because we believe that our united efforts will lead to more results, increase the prosperity and well-being of our citizens and companies and because these policies strengthen Europe’s position in the rapidly globalising world. We are therefore not opting for a minimum programme, but for the “full option” model.

I respect Prime Minister Cameron’s questions and the method that he chose; that is his choice and the British voters will be able to voice their opinions in this matter. I would nevertheless like to emphasise clearly at this point that the UK’s departure from the EU would most of all represent a major loss for the UK itself. But it would of course also be a great blow to the EU: I subscribe to the opinion expressed by many observers who consider that the particular mindset of the United Kingdom, which Prime Minister Cameron himself so aptly described in his speech, has always enriched the EU. But I have to be equally clear that the unravelling of the European working context, the “European menu, would constitute a serious problem for Belgium.

Belgium is by no means against a differentiated policy: the treaties mention the different techniques for differentiation and we apply them in a number of important areas, not least being the use of the euro. But I would like to make a fundamental distinction here: everybody advancing to their own speed in new policy areas is one thing (and is allowed according to the treaties), but selectively withdrawing from established and often very successful policy areas is a completely different matter and in our opinion questionable.

After all, who would prevent other Member States from making their own calculation of unpopular directives or regulations or policy measures that have long been contested or which for example have been the subject of condemnations by the European Court of Justice? The treaty does indeed provide for an opt-out rule for the UK concerning Justice and Home Affairs  issues (Protocol 36 annexed to the Treaty of Lisbon). But what about the other domains?

Always patiently seeking a compromise on which all Member States and the European Parliament can agree, while taking into account the general European interest, belongs to the very essence of life in the European Union. The underlying premise has always been that “sacrifices” are always compensated for with advantages and that the final balance is generally positive for all Member States. If this is not the case, a large and differentiated Union with 27 and soon more Member States will not be able to operate. After all, the Union is much more than the simple sum of 27 individual interests.

All of this does not prevent a fundamental reflection on the future of our Union from being perfectly legitimate, or even necessary. We sometimes hear the same questions of Prime Minister Cameron’s speech being asked in Belgium, and we also have, just like he does, an ideal image of the EU in our minds...

This is why I am convinced that the (possible) referendum debate in the UK would quickly result in all Member States doing some soul searching on the question: what kind of Union do we actually want?

Do we want to pursue our ideal of a political union, with a common currency, a common trade policy, a common space of freedom, fundamental rights and migration, an industrial policy, a foreign and security policy? Where everything is arranged at the European level because this allows us to organise our societies in the most efficient and influential way, internally but also in the larger world, where the EU now represents less than 7% of the population? A Union which includes federal and democratic structures that allow for a fair distribution of power with respect for the authority and prerogatives of the national States, according to the highest standards of the rule of law and of fundamental human rights?

Or do we want, like the British government, to pull out of a few core domains and build up rather loose coalitions that meet the interests of the moment? And in doing so, returning to a basic package that is constructed around the internal market and its four classic freedoms?

David Cameron’s questions are in fact everyone’s questions.

Belgium chooses the “full option” model, with the rights and obligations, with areas that strongly appeal to us, but also with those that suit us sometimes less; we are prepared to relinquish - or better: to share (cfr. the euro) - our sovereignty over certain competences if this is paired with a model of government that rests on a true responsibility that is democratically controlled and that opens the door to real European solidarity.

In order to organise this in an efficient, legally proper and democratically responsible way, we want to go as far as possible in strengthening the EMU, as described above, and within the boundaries of the existing treaties. There will however come a time when our constitutional texts - the treaties - must be amended, but this question will only be addressed after the EP elections in 2014.

As I said earlier, we must primarily focus in 2013 on the major EMU reform plans that President Van Rompuy has proposed.
But fairly soon after that, the unavoidably more fundamental questions will have to be addressed:

- should the Commission not be further developed into a true government? With a president who is the top candidate of the political group of the European Parliament that emerges as the winner of the European elections? And supported by a political majority in the European parliament? In time, should the size of the Commission not be reduced so that the European interest of its proposals and operations can be expressed even better?

- shouldn’t the current two legislative branches, the European parliament and the Council, develop into two representative chambers, one for the citizens (which is already the European Parliament now) and one for the Member States? A true majority/minority system must arise within the European parliament, and the European parliament (and possibly the Chamber of the States as well) should receive a right of legislative initiative.

- national or regional parliaments must, much more than is now the case, follow up on the European governance dimension, with even more intense procedures of exchange of information or dialogue; it will however always be the responsibility of the Member States to develop the appropriate modalities for this.

- The Europe of the future will need a more ambitious budget than is the case now, preferably financed for a large part with own and autonomous resources. This budget will primarily serve two purposes: on the one hand, help the convergence between Member States, not only for the new or poorer Member States but also to assist the older or richer Member States who need punctual support to absorb economic shocks or to restructure vital sectors such as the car and steel industries; on the other hand, improve the competitiveness of our industrial and economic fabric by providing sufficient financial means to develop industrial sectors with a high technological potential for the future such as aeronautic, energy, biotechnology etc…

Allow me, finally,  to say a few words about the other great challenge of this year as well as for the years to come: the reinforcement of the common foreign and security policy.

The European Council of December 2013 has foreseen a substantial debate about the orientations that will have to be given to the European defence policy. All along this year, our experts, members of parliament and ministers will look into this subject. Let us seize this opportunity to launch a new dynamic in this policy that is crucial for the credibility and for the influence of the European Union in the world. We should learn from our experiences in e.g. Libya, Mali and the Indian Ocean. Let us be ambitious but realistic at the same time and accept to draw some inspiration from the systematic method which, even if too slow at times, has been successfully adopted for developing the EMU. Every year, we should see real and concrete progress on the road to more common coordination and planning of our defence policies, such as a better integration of our forces, the pooling and sharing of our means or the development of a strategic vision.

Another big topic this year will be review of the European external action service (EEAS). We also have to take this opportunity to reinforce this service which is crucial for the projection of our interests and values throughout the world. Some reforms such as improving the daily interaction between Member States and the EEAS or concerning the internal functioning of the service can be carried out within the actual legislative framework. Other, more important reforms, like its interaction with the European Commission or the question about political deputies to the High Representative can certainly be discussed in 2013 but their realization - if at least these projects are approved in principle- will have to take into account the organization of the new college of the Commission in 2014. In our opinion, we will also need to look at some time into the financial means of the EEAS; the actual tight budgetary framework reduces considerably its autonomy for quick action on the ground or makes the enlargement of its tasks into useful areas, such as certain aspects of consular policy, difficult.

Without addressing more in detail the different on-going CSDP operations or the important issues of international diplomacy such as the MEPP, Iran or the Sahel region, I can confirm that Belgium will always follow in these debates a voluntary, European and ambitious approach, together with the other “positive forces” of the Union, such as the Benelux or any other Member State that shares our vision and our interest.

Dear Ministers, Excellencies, Ladies and Gentlemen,

The few challenges I have briefly described above need many answers, clarification and attention: this is again a project that will mobilize a whole generation of politicians, lawyers and diplomats. I wish all of you inspiring and productive moments of debate and exchange this week.