The Business Times

Incoming EC chief begins in weak position

Published Tue, Jul 23, 2019 · 09:50 PM
Share this article.

Singapore

AT its June 30-July 2 meeting, the European Council nominated German Defence Minister Ursula von der Leyen - perhaps considered a candidate of least resistance - to become president of the European Commission on Nov 1.

Her task is to inspire confidence in the commission as guardian of the European Union's interests as a whole. Preferably, the commission president should be a greatly experienced politician who has served at the highest levels of government and is familiar with EU machinations. Indeed, the last four presidents were former prime ministers of EU states. Dr von der Leyen is not a political heavyweight in her own country, has never participated in a meeting of the European Council, and is not on record for ideas about the future of the EU.

Nonetheless, she must be ready to tackle several looming rounds of contentious negotiation, all of which risk exacerbating divisions between EU countries. The parcelling out of different categories of member states may undermine the main pillar of the EU that all members in principle participate in all common policies.

Countries in central and eastern Europe benefit handsomely from the EU's various financial support programmes. Poland is the largest net recipient, followed by Greece, Romania and Hungary. Germany tops the list of net contributors, with Britain second and France third. The instrument for paying into the budget and distributing the money is laid down in seven-year multi-annual financial frameworks; the current edition runs through 2020.

TESTING TIME

Negotiations for the next seven-year framework will begin soon. Central and Eastern Europe (CEE) countries will want to maintain existing levels of financial support. Germany and France are certain to adopt a more critical attitude towards EU spending. The UK's exit from the EU complicates talk; as the second biggest net contributor, Britain's departure will cause France and Germany's net contributions to rise. Both groups, recipients and creditors, will see the negotiations as a test of "community solidarity", and expect the other side to concede.

Bolstering co-operation on defence, strengthening the euro and designing a common policy on refugees and migrants are all on the agenda. Add to this the crucial decisions that must be made about the EU's future relationships with Russia, the US and China, as well as the UK post-Brexit. Several countries in the Balkans have filed applications for membership. Turkey is turning increasingly into what could diplomatically be called a major headache. The challenge is to reconcile different and, in some cases, conflicting national interests and fit them into a common EU position.

There was an opportunity for policymakers to nail down Dr von der Leyen's views when she appeared between July15-18 at a session of the European Parliament, which must approve incoming commission presidents. The hearings, however, did not reveal much about her views on the future of European integration. She was forced to hand out promises to garner a majority among parliamentarians dissatisfied by the procedure used at the meeting of the European Council.

She was approved by a wafer-thin majority of 383 votes - only seven more than the 374 required. The message was that a motion of censure will be tabled if she fails to placate the parliament. The way she was selected by the council and a frustrated parliament has weakened her position even before she begins her tenure as commission president. OMFIF

BT is now on Telegram!

For daily updates on weekdays and specially selected content for the weekend. Subscribe to  t.me/BizTimes

Columns

SUPPORT SOUTH-EAST ASIA'S LEADING FINANCIAL DAILY

Get the latest coverage and full access to all BT premium content.

SUBSCRIBE NOW

Browse corporate subscription here