It is not going to be one, clear scenario. What we are talking about is the mixture of all the alternative options that the Commission presented. There will be differentiated integration\u2014which we always had, so it\u2019s only a continuation. In some areas we will see more competences and more sovereignty being transferred to the European Union. In other areas we might see some steps backwards.<\/p>\n
think that what the Commission is implying is that the \u201cmulti-speed Europe\u201d scenario is the most realistic one. And it\u2019s not a question of Commission\u2019s preferences, but the political reality. I\u2019m not sure whether the Commission, if it had free choice, wouldn\u2019t opt for a scenario
\nof deeper European integration, across the board, more uniform. But in current environment such scenario is simply improbable, hence\u2014the multi-speed.<\/p>\n
The big question mark is: what the differentiated integration really means? It is still very unclear. We do not know, for example, what legal tools will be used by the willing countries to change the speed of integration. However, it is fair to assume that at some point in time, the cohesiveness of\u00a0the European Union might be challenged by the very fact of existence of different groups of differently integrated countries.
\nIndeed, the eurozone is the natural\u00a0candidate for such differentiated integration. And it\u2019s not because there are countries who want to distance themselves from the others. The eurozone must start this process because there is a lot of unfinished business in its construction. It\u2019s not by a political desire, it is by necessity. Will this process of reform exclude other countries, non-euro member states? To some extent: yes. But that has always been the case! The choice in the end is for the non-eurozone countries to join the currency. And if they do not want to do that\u2014there\u2019s nothing in the system that could force them. But they cannot expect that the necessary changes in the euro construction will not be tackled. Further integration of the eurozone, which is necessary in order to tackle the structural flaws, does not necessarily mean that the European Union will break up in two parts, the core (eurozone) and the periphery. That risk would only start to materialize if the eurozone countries decided to deepen the integration in other than economic areas, such as defense, security, foreign affairs, etc. Only then we would be in a situation of the eurozone versus the periphery. The mere addressing of the structural flaws in the European Monetary Union is not dangerous. Members of the eurozone do not have a choice, it is something that has to be done. In concrete terms, they have to finish the construction of the Banking Union, introduce some form of common deposit guarantees. Finally, some countries of the eurozone will have to accept that there needs to be some sort of fiscal transfer within the area. Whether this fiscal transfer is achieved by fiscal means or by carving out of the European Union budget\u2014that is secondary. Much depends on the ability of France and Germany to come together on these crucial issues. So, to conclude: there are political risks attached to further integration of the eurozone within the model of \u201cmulti-speed Europe.\u201d But far greater risk would be to allow the eurozone to fail. The consequences of that would be incalculable. European Union could afford it.<\/p>\n
My expectation is that both sets of elections are not going to produce a disaster, we are going to have centrist governments in both countries. Slightly different,\u00a0perhaps, but Europe-oriented nonetheless. Which means that we will have, for the first time since long, a window of political opportunity to strike a deal.<\/p>\n
It all depends on how one would design such a budget. Besides, the creation of a totally separate EU budget would require a Treaty change\u2014which is not very probable. So, I\u2019d rather expect a hybrid solution: either a part of the overall EU budget would be ring-fenced for the eurozone or new mechanisms, similar to the existing European Stability Mechanism [a guarantee mechanism for eurozone members\u2014editor\u2019s note], would be created. Having said that, some consequences for the non-eurozone countries are to be expected. Some countries might not be willing to keep the EU budget intact, make up for the financial loss caused by the Brexit, and create additional financial envelope for the eurozone\u2014all at the same time. This is simply not politically possible. So, to address the new challenges, the funding of the Cohesion Policy and Agriculture Policy will be under pressure. Which, in turn, will have important implications for non-eurozone countries. There might be some negative consequences for them\u2026<\/p>\n
Of course! But in this scenario, it was the\u00a0sovereign choice of the affected not to join the eurozone. It is inevitable that decisions taken within the eurozone will have impact on those who are not involved. The reality is that the eurozone itself is a form of permanent separation\u2014as long there are countries that remain outside. As long as any given country opts for staying out of the area of common currency, there will be limits to the benefits and to the obligations as well.\u00a0It is hard to argue that eurozone membership is easy. It is not. Countries that wish to get in have to sacrifice a lot. Among other things, they have to sacrifice parts of their sovereignty. It\u2019s a question of do\u00a0mestic political decision: in or out? Nobody could rationally expect to reap benefits without being the member of the eurozone. Every choice has its consequences. It is similar to the case of Norway: it opted not to be a member of the European Union. Instead, it is part of our Single Market\u2014but without voting rights. And it has to pay a substantial amount of money to the EU budget. As things stands now, Poland, Hungary, and the Czech Republic are members of the European Union, but without voting rights in the eurozone. The rights of the non-euro member states that are provided by the Single Market legislation will not be challenged. The freedoms that constitute the backbone of the Single Market are written in the Treaties. European Commission will guard them, there\u2019s always a possibility to recourse to the European Court of Justice. The fact that eurozone decisions affect non-eurozone countries does not mean that the latter are stripped of their rights. There are legal safeguards, even in areas of differentiated (multi-speed) integration. One should also remember: the eurozone member states have majority in the EU, also in terms of population, as 70% of EU citizens live in the eurozone. So, theoretically, the eurozone countries will be able to decide something in their internal discussion and then to formally vote for it in the European Union Council. Countries who complain about being excluded are in fact excluding themselves by not being willing to join the eurozone. Besides, when they were joining the EU, they legally committed themselves to join.<\/p>\n
I\u2019ve heard this argument before, but I do not find it credible. First, no country is being forced into eurozone, it still is a choice. Second, it is either unrealistic or deliberately unrealistic to think that something like the economic union or even the Single Market couldn\u2019t change overtime. And in the end countries such as Poland have the choice to decide whether they want to stay within the European Union or not. There\u2019s no force obliging a country to stay in the EU. If the framework of the European Union has changed so much in the intervening years\u2014changed so much that it is no longer in their interest to stay\u2014then there is a choice they will have to make.<\/p>\n
Yes. Especially after the Brexit vote, we are moving towards the European Union, where by far the biggest economic and political weight will be within the eurozone. So, for countries that are currently outside, it limits them both in terms of economic integration but also in terms of influence. Still, there is a price to pay: and this price for many countries at the moment is a very difficult one to pay. It is the price of sovereignty.<\/p>\n
It is inherently in the interest of those countries to join the euro. We\u2019re living now in a much more volatile world. The risk of currency fluctuations and the instability that this might bring is not to be underestimated. Look at what is happening to the British pound now. Imagine the same happening in Hungary or Poland. With the trade ties, with high level of import penetration, consumer goods, etc.\u2014the effects would be more dramatic than the ones we are seeing in the UK. On inflation, consumer process, wages, living standards. I\u2019m not denying that in certain situation, the flexibility of currency fluctuation is helpful. What I\u2019m saying is that you cannot offset structural weaknesses of any given economy by a constant policy of devaluation.<\/p>\n
One should not speculate what would be the situation in Greece if it was not in the eurozone. It is not the common currency that plunged the country into crisis. Structural flaws in the economy did, the ones that existed there for many years. The only thing the common currency did was to show these flaws.<\/p>\n
I doubt it. Does anybody seriously believe that Greece would be able to print drachmas in order to pay pensions, health service, etc.? By now, this currency would\u00a0be worthless. Besides, this is a discussion how to make the eggs out of omelet. It is impossible, we are where we are, and we can only think how to improve the situation in Greece, member of the eurozone. Countries need to reform their economies
\nregardless of their willingness or not to join the euro. It is in their best interest, as simple as that.<\/p>\n
Yes, we have a populist challenge in many countries. But let\u2019s see what happens this year. I do not think populists will do as well as they hope to. Partially because of what\u2019s currently happening: there is a backlash against populism after Brexit\u00a0referendum and after Donald Trump. People all over the Europe are starting\u00a0to rediscover the value of the EU, talking\u00a0about their belonging, about the security\u00a0that the EU gives. The success of Martin Schultz in Germany is a stunning example of German population looking for something different than a negative, nationalistic populism. You have the same effect\u00a0in France with the candidacy of Emmanuel\u00a0Macron. Macron is not considered to
\nbe part of the old establishment but at the same time he represents the progressive, forward-looking agenda. The defining line of the political battle we all face is between people who believe in openness and\u00a0liberal democracy, and those who don\u2019t. That of course would require deep changes\u00a0in the established political forces, political\u00a0parties. It will also affect many other\u00a0institutions like media or trade unions. We have to show our citizens that openness\u00a0of our societies is something that helps us dealing with the challenges we face, not something that threatens us. Of course, the EU will need to be better at protecting its citizens\u2014because they feel\u00a0threatened, although they have not been
\nharmed objectively. What we are dealing with in many cases is the fear and perception of danger, not a real damage. People ask questions about their future: will they still have jobs, will they be able to compete,\u00a0what will happen to their kids, the\u00a0next generation, will the society still be\u00a0cohesive? And dealing with fears and perceptions\u00a0is often more tricky than dealing with real problems. For example, if we had a situation where we could identify the\u00a0true losers of globalization, then the classical response would be \u201cdistribution.\u201d We would materially compensate those who lost because of the globalization. But it won\u2019t help fighting the fear\u2014because the ones we would have to tax in order to\u00a0collect additional resources are the ones who are actually afraid of the future.<\/p>\n
If there are abuses of freedom of moment, like unjustified claims for social benefits, then we need to address them. But I am not saying that this is the case with posted workers. It has to be proven. In the end, the European Court of Justice will always weigh the decisions\u00a0taken by governments against the letter of the Treaties. Freedom of movement\u00a0is in the Treaties. Unjustified limitations,\u00a0with an aim to limit the competition, will by stricken down by the court.<\/p>\n
Yes, but these need to be real results: just\u00a0saying that we are doing something\u2014and\u00a0not delivering\u2014is far worse than doing\u00a0nothing. In the past, the EU has often created expectations it could not meet for\u00a0lack of competences and mechanisms.\u00a0Just to give the example: the idea that Europe\u00a0will address youth unemployment\u00a0was deeply wrong. Even at the national\u00a0level we don\u2019t have the tools to tackle\u00a0this problem efficiently. Expectation management is crucial: we have to tell\u00a0the people that there are things that Europe\u00a0can do, and that there are things
\nit can\u2019t do. The title \u201cEurope of results\u201d\u00a0in itself is not the answer to populism.<\/p>\n
is the chief executive and chief economist of the European Policy Centre, a Brussels-based not-for-profit think tank on European Union affairs. He is also an honorary fellow at the Europa Institute\u00a0of the University of Edinburgh and an honorary professor at Heriot Watt University. His research focuses on the economic and euro crises, including the reform of the new economic governance at\u00a0eurozone level. He also works on the Single Market, Digitalisation, European labour markets and the EU budget. He has a long-standing interest in the political economy of European integration, with a particular focus on the UK-EU relationship, analysing the impact of Brexit on the UK and
\nthe rest of the EU, as well as the process of separation. He was appointed to the Standing Council on Europe, established by Scotland\u2019s first minister after the Brexit vote in June 2016. He regularly comments on current political and economic issues in the EU in the media.<\/p>\n","protected":false},"excerpt":{"rendered":"
There are political risks attached to further integration of the eurozone within the model of \u201cmulti-speed Europe,\u201d but far greater risk would be to allow the eurozone to fail\u2014says Fabian Zuleeg in an interview with Konrad Niklewicz.<\/p>\n","protected":false},"author":18,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[1],"tags":[108,176,172,109,177,178],"class_list":["post-9389","post","type-post","status-publish","format-standard","hentry","category-nezarazene","tag-economy","tag-eu-budget","tag-eurozone","tag-interview","tag-multi-speed-europe","tag-white-paper"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.aspeninstitutece.org\/cs\/wp-json\/wp\/v2\/posts\/9389","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.aspeninstitutece.org\/cs\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.aspeninstitutece.org\/cs\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.aspeninstitutece.org\/cs\/wp-json\/wp\/v2\/users\/18"}],"replies":[{"embeddable":true,"href":"https:\/\/www.aspeninstitutece.org\/cs\/wp-json\/wp\/v2\/comments?post=9389"}],"version-history":[{"count":2,"href":"https:\/\/www.aspeninstitutece.org\/cs\/wp-json\/wp\/v2\/posts\/9389\/revisions"}],"predecessor-version":[{"id":11037,"href":"https:\/\/www.aspeninstitutece.org\/cs\/wp-json\/wp\/v2\/posts\/9389\/revisions\/11037"}],"wp:attachment":[{"href":"https:\/\/www.aspeninstitutece.org\/cs\/wp-json\/wp\/v2\/media?parent=9389"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.aspeninstitutece.org\/cs\/wp-json\/wp\/v2\/categories?post=9389"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.aspeninstitutece.org\/cs\/wp-json\/wp\/v2\/tags?post=9389"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}