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1. A battle against time – and against Putin’s Russia

Author:
Erwan Fouéré
Publication Date:
02-2024
Content Type:
Working Paper
Institution:
Centre for European Policy Studies (CEPS)
Abstract:
With Putin’s war against Ukraine about to enter its third year, the EU’s enlargement policy remains at the top of its foreign policy priorities, with the focus being on both Ukraine and Moldova. This is following the European Council’s decision to open accession negotiations with both countries. But where does this leave the countries of the Western Balkans and their very long journey towards the EU which began over 20 years ago? Will these countries’ hopes for much needed political momentum in their accession prospects be fulfilled during 2024, despite the repeated delays and the EU’s failure to respect its commitments to the region over the past few years? With elections taking place across Europe offering fertile ground for Russia to deploy its arsenal of disinformation tactics, time is not on the EU’s side. To counter Russian attempts to influence developments in the region, as well as to reverse the dangerous trend of backsliding in democratic and rule of law reforms, the EU will need to adopt a more robust, consistent and determined approach towards the Western Balkans. Without any further delay, it needs to set out a much needed geopolitical and security direction for its enlargement policies in the Western Balkans.
Topic:
Security, European Union, Democracy, Geopolitics, Rule of Law, Regional Integration, and Russia-Ukraine War
Political Geography:
Europe, Ukraine, Moldova, and Balkans

2. The State of EU-US Digital and Energy Cooperation

Author:
Federica Marconi, Wolfgang Münchau, and Irene Paviotti
Publication Date:
02-2024
Content Type:
Working Paper
Institution:
Istituto Affari Internazionali
Abstract:
In a time of rapid technological advancements and changing energy paradigms, the European Union and the United States are trying to coordinate their efforts to navigate the complexities of an ever-evolving landscape. Transatlantic dialogues and cooperative endeavours are key mechanisms for mitigating tensions and fostering a common assessment of the opportunities and risks arising from these advancements. Critical in this regard are the problems of governance emanating from technological development and its consequences in the digital sphere as well as the delicate balance between security, competitiveness and environmental targets in the energy dimension.
Topic:
Climate Change, International Cooperation, Political Economy, Governance, European Union, Transatlantic Relations, Digital Policy, and Energy
Political Geography:
Europe, North America, and United States of America

3. The Future of the Belt and Road in Europe: How China’s Connectivity Project is Being Reconfigured across the Old Continent – and What It Means for the Euro-Atlantic Alliance

Author:
Nicola Casarini
Publication Date:
02-2024
Content Type:
Working Paper
Institution:
Istituto Affari Internazionali
Abstract:
China’s Belt and Road Initiative (BRI) has entered the twilight zone in the old continent, following a deterioration of bilateral relations between the EU member states and China over the last years. Italy’s official exit from the BRI at the end of 2023 was a further blow to Chinese President Xi Jinping’s signature foreign policy. Yet, the BRI in Europe is being reconfigured rather than being terminated. In Western Europe, the BRI is moving away from physical infrastructure projects and investment in industrial assets – the latter being increasingly protected from Chinese takeovers by both national and EU legislation – to financial and monetary connectivity. This shift is welcomed by various European actors, including some policymakers at the national level, eurozone institutions and major banks. Concurrently, most of Eastern European countries continue to promote BRI projects and seek to attract Chinese investments, suggesting that there is a two-speed Europe when it comes to China, both in terms of geography and sectors.
Topic:
Infrastructure, Foreign Direct Investment, European Union, Belt and Road Initiative (BRI), and Currency
Political Geography:
China, Europe, Asia, and Italy

4. Challenges to Transatlantic Digital Infrastructure: An EU Perspective

Author:
Anselm Küsters, André Wolf, and Eleonora Poli
Publication Date:
02-2024
Content Type:
Working Paper
Institution:
Istituto Affari Internazionali
Abstract:
Recent disruptions in the Baltic Sea and elsewhere highlight the integral role of digital and physical conduits such as gas pipelines, telecommunications cables and undersea data cables in maintaining European connectivity and security. Overall, the EU’s responses to emerging challenges to its digital sovereignty, particularly from China and Russia, aim to enhance the security and resilience of its digital landscape, from the Global Gateway Strategy to the Gaia-X project. However, the complexity of the submarine cable infrastructure requires a broader and more holistic assessment of the opportunities and obstacles to ensuring the uninterrupted flow of information across borders. Ultimately, a concerted transatlantic effort is needed to strengthen the backbone of Europe’s digital infrastructure against both man-made and natural adversities, thereby securing a future where sovereignty and resilience are paramount for both the EU and the US.
Topic:
International Political Economy, Politics, Infrastructure, European Union, Institutions, Transatlantic Relations, and Digital Policy
Political Geography:
Europe

5. Chips: EU’s Ambition in a Transatlantic Technology Bridge

Author:
Nicola Bilotta
Publication Date:
02-2024
Content Type:
Working Paper
Institution:
Istituto Affari Internazionali
Abstract:
Semiconductors are vital building blocks of digital technologies. In line with its aspiration for strategic autonomy, the EU has recognised vulnerabilities in its chip supply chain, which heavily relies on foreign firms. The intricate relationship between economic security and open trade underlies the EU’s quest to bolster its domestic capacity while enhancing connections with key global partners. Despite the challenges of finding a policy balance, fostering transatlantic cooperation in the semiconductor domains remains a key ambition. To cultivate a more balanced and effective partnership with the US, the EU should capitalise on its comparative advantages to amplify and fortify its strategic positioning in the global supply chain.
Topic:
International Political Economy, Science and Technology, Governance, European Union, Transatlantic Relations, and Industry
Political Geography:
Europe

6. The Future of EU Blended Finance and Guarantees: An Assessment of Cooperation Strategies with Least Developed Countries in Africa

Author:
Erik Lundsgaarde
Publication Date:
01-2023
Content Type:
Working Paper
Institution:
German Institute of Development and Sustainability (IDOS)
Abstract:
The European Fund for Sustainable Development Plus (EFSD+) is a core element of EU development cooperation and reflects the EU’s strong commitment to deploying blended finance and guarantees as development financing tools. This discussion paper examines the EU’s intentions concerning how the EFSD+ will be integrated into geographic programmes, focussing on the least developed countries (LDCs) in Africa. Based on a review of the Multiannual Indicative Programmes (MIPs) for 30 African LDCs as well as the regional MIP for Sub-Saharan Africa covering the period 2021-2027, the paper provides an overview of funding reserved for EFSD+ implementation in geographic programmes, identifies the expected EFSD+ sectoral priorities and summarises references to development finance institutions (DFIs) as EFSD+ implementation partners. This descriptive review highlights issues for the future monitoring and assessment of the EFSD+. The paper points to uncertainty about the magnitude of the management challenge that EU institutions face in EFSD+ implementation given the difficulties of predicting the scale of guarantee-backed operations in individual countries, the lack of information on the expected volume of blended finance operations, and the limited analysis of how EFSD+ tools relate to other EU funding approaches. The paper also notes that EU institutions should be more explicit about the criteria shaping EFSD+ resource commitments to clarify relevant prerequisites for the effective deployment of EFSD+ tools. Finally, the broad thematic scope for EFSD+ use implies that knowledge about how blended finance and guarantees function and how the financing approaches interact with other interventions needs to increase throughout the EU system.
Topic:
Development, European Union, Finance, Sustainability, and Cooperation
Political Geography:
Africa and Europe

7. The European Union and the war in Ukraine: the liberal power and its limits

Author:
Maxime Lefebvre
Publication Date:
01-2023
Content Type:
Working Paper
Institution:
Robert Schuman Foundation (RSF)
Abstract:
The European Union has been deeply affected by the war in Ukraine. There was talk of a "paradigm shift" in France, of a "Zeitenwende" ("change of era") in Germany, of an "end to naivety". Across Europe, a surge of sympathy and solidarity for Ukraine and its suffering has gripped public opinion, right down to the blue and yellow colours of the EU and Ukrainian flags being ostensibly displayed by Ursula von der Leyen. The European Union has given massive economic aid to Ukraine (€20 billion already paid out, €20 billion planned for 2023) and has taken in 4 million Ukrainian refugees. At the June European Council, it accepted Ukraine's membership application, as well as that of Moldova, and a prospect of accession for Georgia. By adopting sanctions against Russia that were unprecedented since those taken against Serbia at the beginning of the wars in the former Yugoslavia, it has also demonstrated its capacity for "hard power". In the wake of its common defence policy, it delivered arms to Ukraine for the first time through its €3 billion "peace facility". By almost completely depriving itself of Russian fossil fuels, it is accelerating its energy transition. This shows the enormous change that the war in Ukraine represents for the European project, which is undergoing a new existential crisis after the repeated shocks of the last few years (eurozone crisis, migration crisis, Brexit, Covid-19 pandemic), which again seems to confirm Jean Monnet's prophecy that Europe would be built through crises and would be the sum of the solutions brought to these challenges. By defending its values against Russia, the European Union is asserting itself as a "liberal power". But it remains no less fragile beyond its response.
Topic:
European Union, Geopolitics, Liberalism, Strategic Autonomy, and Russia-Ukraine War
Political Geography:
Russia, Europe, and Ukraine

8. Digital Sovereignty: European Policies, American Dilemmas

Author:
Mathilde Velliet
Publication Date:
01-2023
Content Type:
Working Paper
Institution:
Institut français des relations internationales (IFRI)
Abstract:
European digital sovereignty has been made a priority by Ursula von der Leyen’s European Commission. Due to the privileged position of American companies in the European market, Brussels’ efforts towards digital sovereignty (on privacy, antitrust, data sovereignty, etc.) are closely scrutinized by American policymakers. They often view European initiatives as “protectionist” and unfairly targeting U.S. companies. However, the American vision of European digital sovereignty has evolved in recent years under the influence of two main factors. On the one hand, awareness of the problematic effects and practices of platforms has led to a consensus on the need for reform in the digital sector. On the other hand, technological competition with China has been elevated to a priority. This vision remains fraught with contradictions, along inter-party, intra-party, inter-agency, state-federal, and issue-based fault lines. Washington’s position on anti-monopolistic practices is an illuminating example, characterized by a double discourse between a desire to reform the U.S. digital sector domestically and active diplomacy to dilute these efforts at the European level. Nonetheless, several American actors – particularly in the legislative branch – are seeking to learn from the successes and flaws of European regulations for American reform projects, such as on platform regulation or privacy. The China factor reinforces the ambiguity of the U.S.’ position. It creates new opportunities for cooperation in the face of perceived common vulnerabilities (infrastructure security, inbound investments, etc.) and autocratic definitions of digital sovereignty. However, it also raises tension and misunderstanding on the American side towards European reforms that often target American companies more than Chinese ones. Lastly, while American and European companies have adapted to the need for digital sovereignty through a range of technical and commercial solutions, the temptation of a maximalist definition of European sovereignty continues to create major stumbling blocks, particularly on the cloud.
Topic:
European Union, Regulation, Cloud Computing, Digital Sovereignty, and Data Governance
Political Geography:
China, Europe, Asia, North America, and United States of America

9. How the War in Ukraine is Changing the Space Game

Author:
Guilhem Penent and Guillaume Schlumberger
Publication Date:
02-2023
Content Type:
Working Paper
Institution:
Institut français des relations internationales (IFRI)
Abstract:
The war in Ukraine has become a showcase for the new commercial paradigm emerging in the space sector (New Space). As such, it seems to confirm the relevance of adaptation efforts led by the United States – more specifically the Pentagon – since the mid-2010s. Thus, it highlights ongoing transformations and announces potential disruptions in the exploitation of orbits, particularly in the fields of satellite connectivity and remote sensing. It also shapes future tensions, while the structuring of international relations around the two poles constituted by the United States and China raises questions about the consequences on the safe, sustainable, secure, and stable use of space. With these developments, Europe is faced with the challenge of remaining relevant.
Topic:
International Relations, European Union, Space, Satellite, and Russia-Ukraine War
Political Geography:
Russia, China, Europe, Asia, and United States of America

10. The Europeanisation of the Energy Transition in Central and Eastern EU Countries: An Uphill Battle that Can Be Won

Author:
Diana-Paula Gherasim
Publication Date:
04-2023
Content Type:
Working Paper
Institution:
Institut français des relations internationales (IFRI)
Abstract:
Russia’s war in Ukraine, and the brutal decoupling from Russian fossil fuels, is a game changer for the Central and Eastern Europe region which was still heavily dependent on Russia for its energy supply. There are still a few oil, gas, and nuclear fuel supplies, but the sharp decline, and search for alternatives, lead to a shift in paradigm: deploying low-carbon technologies and energy efficiency is now a matter of national security and economic security. Hence, following the 2022 energy crisis, the understanding that the European Union’s (EU) energy security of supply means an acceleration in phasing out fossil fuels and deploying clean energies has become the newest European acquis in energy policy, increasing the importance of the Green Deal at EU, national and local levels. The risk that a carbon wall would be erected within Europe between the West and the Central and Eastern European Member States (CEECs) is no more valid. The concept of Europeanization is at the core of the analysis of the energy transition in the CEECs. The progress on greenhouse gas (GHG) emissions reduction observed in these Member States (MS) can be considered as a success of the Europeanization process in this region, as its timing coincides with the implementation of the 2020 agenda for climate and energy, to the establishment of which these countries were part of. Moreover, the Clean Energy Package and the Green Deal seem to have been successful in putting in place a mechanism of cognitive framing pertaining to the Europeanization toolbox, by setting a framework for all Europeans to move in the same direction, of a cleaner and healthier way of living, independently of their starting point. Given the status quo in the ten CEECs, the new ambitious objectives regarding transport decarbonization will translate into important transformation costs for the region, which in turn could increase the risk of renegotiation attempts, as the circular Europeanization theory predicts. The acknowledgment at the EU level that the transition must be just to succeed is one instance of bottom-up Europeanization, where the challenges brought forward by specific Member States shaped the European energy transition agenda and discourse. Large financial support for this end was a first condition for CEECs to support the climate neutrality agenda. The second condition is that CEECs plan to replace their coal fleet at least partially with nuclear power, be they reactor capacity expansions, lifetime extensions, large new reactors, or small modular reactors (SMRs). The third condition has been securing a role for the use of natural gas for the transition, which in 2022 turned out to be a costly choice. With the crisis, CEECs have all taken on board the necessity to boost renewables as a tool to rapidly decrease dependence on imported fossil fuels, to meet the 2030 targets, prepare for the progressive phase-out of free emission allowances while awaiting the new nuclear generation capacities due from 2035 onwards. This strategy is also supported by public opinion, while it remains to be seen how public acceptance of SMRs will be. This gives the CEE region a strong joint interest to push for the inclusion of nuclear energy in EU legislations, alongside France. On gas, countries have switched to liquefied natural gas (LNG) and diversified their pipeline supplies, and where possible, try to boost the domestic supply of natural gas and soon, biomethane. Although being relatively far from alternative gas entry points means that for some CEECs Russia remains, to a certain extent, a necessity, this cannot be used as an excuse for undermining EU unity and should push towards harder EU-level reflections on energy solidarity on which some progress was done during the 2022 energy crisis. It remains to be seen if a new line of fragmentation will not appear between Germany and Austria on the one hand and the CEEs on the other: following the Nord Stream betrayal and denial by Germany of Polish energy security concerns for example, CEECs are concerned about the extraterritorial outreach of Germany’s nuclear phase-out policies, and of Austria’s continued systemic opposition to nuclear. This plays in the hand of the United States, which is the ultimate gatekeeper to pressure Germany and secure the energy technology choices of CEECs through the export of US technologies. Of note is also the shared concern now over the dependence on Russian nuclear fuels and equipment, and efforts to reduce this. A last source of possible tensions comes from some new gas infrastructure investments which can strengthen resilience but risk locking in gas much longer than the EU trajectory allows for. Beyond nuclear energy, however, the interest in accelerating the deployment of renewables, and the concern over a just transition, the note shows that there is little in common between the CEECs which have all their specificities. Last but not least, this note argues that a new risk of fragmentation may emerge, related to the localization of innovation and the volume of state aids and subsidies to industries. While some CEECs appear to be a frontrunner in the deployment of battery cell gigafactories, their financial and budgetary capacities are much more limited compared to Western MSs, and their ability to develop comprehensive, coherent climate plans, and to mobilize EU tools and funding, is also limited. Without an EU Sovereignty Fund, the region will find it hard to keep pace with EU’s objectives in the Net-Zero Industry Act and the Critical Raw Materials Act due to limited fiscal space to be leveraged for state aid purposes, despite more favorable conditions.
Topic:
European Union, Renewable Energy, Fossil Fuels, Transition, and Energy
Political Geography:
Europe, Eastern Europe, and Central Europe

11. European Democracy Support Annual Review 2022

Author:
Richard Youngs, Elena Ventura, Ken Godfrey, Erin Jones, and Zselyke Csaky
Publication Date:
01-2023
Content Type:
Working Paper
Institution:
Carnegie Endowment for International Peace
Abstract:
The need to defend democratic values from violent attack was the dominant theme of 2022. Russia’s invasion of Ukraine in February made democracy’s defense a priority of the highest geopolitical as well as normative order. It propelled commitments to protect democracy to the top of the agenda for Europe, internally as well as in foreign and security policy. European powers responded and a common line gained currency that the war had pulled them through a watershed conversion in their strategic outlook. However, in a year dominated by the imperative of defending democracy, European policies specifically aimed at supporting democracy evolved in only understated fashion. While these policies were adjusted in important ways to the new context, Europe shifted gear much less in this area than in others. In 2021, the European Democracy Hub published the first annual review of European democracy support.1 This second review aims to provide an empirical overview of European democracy support policies in 2022. The review covers policies, strategies, and initiatives at the level of the European Union (EU) as well as those of its member states and of non-EU European countries active in democracy support (Norway, Switzerland, and the United Kingdom). It presents information on European efforts to defend and strengthen democracy around the world while highlighting their shortcomings. The aim is to inform debates about policies geared toward upholding democracy internationally. Russia’s invasion of Ukraine dominated European policy debates in 2022 in many ways. This review examines the democracy-related consequences of the invasion and of the geopolitical changes it unleashed. Western leaders framed the invasion as a threat not only to Ukraine but also to democratic norms and the rules-based order more widely, and as such it galvanized EU institutions and European governments into new commitments to defend democracy. However, these commitments were far from being the main policy responses; for all the rhetoric about a new struggle to defend democratic values, many elements of European democracy policy were second-order priorities. And, in some ways, the security aspects of the strategic landscape diluted European democracy commitments. The invasion did not alter all aspects of European democracy policy, which in many countries was shaped by domestic political developments. In a year of notable protests and other forms of civic activism around the world, the EU and some member states improved the ways in which they engage with local actors in support of political reform. The EU began to roll out many new programs in its democracy toolbox. Though low-profile, this began to add more tactical sophistication to EU policies. Yet the degree of European support for democratic openings remained modest and, in some places, negligible. And, while much attention was on the global consequences of the war in Ukraine, the EU’s democracy activities moved up a gear to a greater extent internally than externally. This review offers a summary of the main changes to the context conditioning European democracy policies before outlining their evolution at the EU and national levels during the year. It then looks at the war in Ukraine and the democracy-related aspects of the European response to it. The review then delves into more specific aspects of democracy support that were pursued, such as democracy funding, the use of sanctions and conditionality, and democracy considerations in conflict interventions. In line with the previous review, we frame democracy support in a broad sense. The concept lacks a firm definition and this review reflects an elastic understanding of it. Broadly, the analysis considers quantitative and qualitative aspects of European strategies relevant to strengthening democratic practices, norms, and institutions. Democracy support in this sense includes the use of funding for democracy projects, decisions over sanctions, the use of political conditionality, and the incorporation of democracy factors into conflict-related policies. The review looks not only at examples of such democracy support but also instances where democratic considerations were absent from EU policy. Democracy support is understood here as including EU and European action around the world, including within Europe, but not the actions of governments in their country’s domestic affairs.
Topic:
European Union, Democracy, Regional Politics, and Russia-Ukraine War
Political Geography:
Europe

12. Leveraging Lives: Serbia and Illegal Tunisian Migration to Europe

Author:
Hamza Meddeb
Publication Date:
03-2023
Content Type:
Working Paper
Institution:
Carnegie Endowment for International Peace
Abstract:
In 2020–2022, Tunisian illegal migrants traveled through Serbia to reach Western Europe, as an alternative to the hazardous, more monitored Mediterranean route. This was driven by push factors in Tunisia, including deteriorating economic conditions and government acquiescence, and pull factors in Europe, namely smuggling networks and Serbian authorities looking the other way. While the route was sealed for Tunisians in November 2022, as long as transit states can use illegal migration to secure geopolitical leverage, such actions will continue.
Topic:
Migration, European Union, Economy, and Smuggling
Political Geography:
Europe, Serbia, North Africa, and Tunisia

13. Rethinking the EU’s Approach to Women’s Rights in Iran

Author:
Barbara Mittelhammer, Tara Sepehri Far, and Sussan Tahmasebi
Publication Date:
04-2023
Content Type:
Working Paper
Institution:
Carnegie Endowment for International Peace
Abstract:
After the death of twenty-two-year-old Mahsa (Jina) Amini in the custody of Iran’s morality police on September 16, 2022, protests quickly spread throughout the country under the slogan of “Woman, Life, Freedom.” Amini’s death galvanized a movement that connects women’s individual freedom to choose their dress code to the systemic social, political, and economic grievances of a larger population that is demanding fundamental change. In claiming the realization of their basic rights, Iranians are revolting against a system that not only oppresses women and peaceful dissent but also continues to fail to meet citizens’ needs. This fight, which has attracted global solidarity, highlights the core message that when women’s rights are marginalized to nonexistence, human rights for all are at risk. The protests have taken place amid mounting repression of organized peaceful activism, a continuing deterioration of Iranians’ basic rights, and a host of economic ills, including rising inequality, increasing poverty, worsening living conditions, skyrocketing food prices, raging inflation, and rising unemployment. Three years of the coronavirus pandemic as well as decades-long comprehensive economic and financial sanctions have gravely added to the socioeconomic calamity. On top of this economic insecurity, precarious and perilous working conditions had already sparked increasing protests in Iran in recent years, resulting in the government’s harsh crackdown on human rights activists and civil society as well as further infringements on rights, including internet shutdowns, even before current events. Repression and the deterioration of Iran’s socioeconomic conditions have aggravated the situation for women in particular. Especially in recent years leading up to the current protests, this trend has hindered Iranian women’s ability to mobilize, protest, and achieve the full realization of their rights. Those who experience intersecting discrimination because of their minority background or social status are impacted even more if they live in rural areas, which are less developed than urban ones, or in areas on Iran’s border, which the state views predominantly through a security lens. The international response to Iran’s very poor human rights record and current protests, however, has lacked a holistic approach that considers women’s key role as agents of change and encompasses civil and political as well as social and economic rights as integral components of women’s rights. In fact, women’s rights and gender equality are not only goals in themselves but also enable the realization of fundamental rights of other marginalized groups, such as children and minorities. Moreover, women’s rights and gender equality are the strongest indicators of and preconditions for sustainable and peaceful societies, both internally and externally. Yet, the European Union’s (EU’s) current approach to Iran does not account for this reality. Over the past years, the EU’s policy toward the country has focused on negotiations to revive the Joint Comprehensive Plan of Action (JCPOA) after Washington’s withdrawal from the deal in 2018. The current situation in Iran urgently highlights the need for a policy framework that responds to the government’s repression and gross human rights violations and, equally, considers the disastrous socioeconomic situation in the country, which is a key obstacle to the public’s ability to organize to realize its rights. Given the importance of economic precarity and socioeconomic inequality in the current revolt, the EU should adopt policies that can support the protesters’ rights and demands in the short term while considering a revised long-term approach centered on empowering Iranians in their efforts to create long-lasting democratic change.
Topic:
Human Rights, European Union, Women, and Protests
Political Geography:
Europe, Iran, and Middle East

14. Small-scale LNG in the Euro-Mediterranean: A Contribution to the Decarbonisation of the Maritime Sector

Author:
Pier Paolo Raimondi
Publication Date:
01-2023
Content Type:
Working Paper
Institution:
Istituto Affari Internazionali
Abstract:
While governments have reaffirmed their commitment towards energy transition in light of the current energy crisis, the urgency to act implies to use all possible solutions to reduce CO2 emissions during the transitional period. Natural gas can play a role in the decarbonisation of certain sectors, such as the transport sector. In this sense, the small-scale LNG industry could contribute to the decarbonisation of the Mediterranean region. Regulatory and political incentives as well as socioeconomic and environmental benefits could represent critical drivers for the growing role of the small-scale liquefied natural gas (SSLNG), while it will need to overcome several challenges (e.g. political pressure, economic and infrastructure constraints).
Topic:
Climate Change, Natural Resources, European Union, Gas, Decarbonization, and Energy
Political Geography:
Europe and Mediterranean

15. Fossil Fuel Industry Phase-Out and Just Transition: Designing Policies to Protect Workers’ Living Standards

Author:
Robert Pollin
Publication Date:
02-2023
Content Type:
Working Paper
Institution:
Political Economy Research Institute (PERI), University of Massachusetts Amherst
Abstract:
This paper focuses on just transition policies targeted at supporting workers now employed in the fossil fuel industries and ancillary sectors within high-income economies. As a general normative principle, I argue that the overarching aim of such policies should be to protect workers against major losses in their living standards resulting through the fossil fuel industry phase-out. The impacted workers should be provided with three critical guarantees to accomplish this, in the area of jobs, compensation and pensions. Just transition policies should also support workers in the areas of job search, retraining and relocation, but these forms of support should be understood as supplementary. Within the framework of these broad principles, the paper first reviews experiences with transitional policies in Germany, the UK, the EU and, more briefly, Japan and Canada. A critical point that emerges is that these just transition policies do not provide the needed guarantees for assuring workers that they will not experience major living standard declines. The paper then describe an illustrative just transition program for workers that includes reemployment, income and pension guarantees, focusing on a case study for the U.S. state of West Virginia. The results show that the costs of the just transition program for West Virginia’s fossil fuel industry dependent workers will amount to an annual average of about $42,000 per worker, equal to about 0.2 percent of West Virginia’s GDP. I briefly summarize results from the seven other studies of U.S. states and for the overall U.S. economy. For the U.S. economy overall, the just transition program’s costs would total to about 0.015 percent of GDP. These findings demonstrate that providing a generous just transition program does not entail unaffordable levels of public spending. Robust just transition policies should therefore be understood as an entirely realistic prospect for all high-income economies.
Topic:
Political Economy, Labor Issues, European Union, GDP, Economy, and Fossil Fuels
Political Geography:
Japan, United Kingdom, Europe, Canada, and Germany

16. Industrial policy for electric vehicle supply chains and the US-EU fight over the Inflation Reduction Act

Author:
Chad P. Bown
Publication Date:
05-2023
Content Type:
Working Paper
Institution:
Peterson Institute for International Economics
Abstract:
The Inflation Reduction Act (IRA) of 2022 provoked a transatlantic trade spat. After the law was passed, the Biden administration addressed some of the concerns raised by the European Union by writing controversial rules to implement the legislation. These regulations are expected to have complex effects that, in some instances, may offset the intended impact of other provisions in the original legislation. This paper examines how the law, its implementing regulations, policy decisions on leasing, as well as potential critical minerals agreements all have the potential to affect the electric vehicle (EV) supply chain. The EV case study showcases the political-economic complications involved in US and EU attempts to cooperate over clean energy transition policy to address the global externality of carbon dioxide emissions. EVs are but one example of the challenge facing partners with integrated supply chains and similar levels of economic development that share concerns about climate change, rising inequality, workers, other social issues, and democracy itself. The EV conflict laid bare the differing US and EU prioritization of these issues relative to economic efficiency, World Trade Organization rules, the approach to nonmarket economies, and national security vulnerabilities that arise from depending on an authoritarian regime such as China for import sourcing of critical inputs.
Topic:
Industrial Policy, International Trade and Finance, European Union, Supply Chains, and Electric Vehicles
Political Geography:
Europe, North America, and United States of America

17. The NewSpace market: Capital, control, and commercialization

Author:
Robert Murray
Publication Date:
04-2023
Content Type:
Working Paper
Institution:
Atlantic Council
Abstract:
Commercial opportunities in space-based technologies are expanding rapidly. From satellite communications and Earth observation to space tourism and asteroid mining, the potential for businesses to capitalize on these emerging technologies is vast and known as “NewSpace.”1 The NewSpace model is important for governments to understand because the dual-use nature of space, specifically its growing commercialization, will influence the types of space-based technologies that nations may leverage, and consequently, impact their national security paradigms. By capitalizing on the private sector’s agility and combining it with the essential research efforts and customer role played by the public sector, the NewSpace industry can play a critical function in addressing current and future national security challenges through public-private codevelopment. As the NewSpace industry expands, the role of government is evolving from being the primary developer and operator of space assets to facilitating their commercialization, while still prioritizing key advancements. US and allied governments can capitalize on this competitive landscape by strategically investing in areas that align with their national security objectives. However, it is crucial for them to first understand and adapt to their changing roles within this dynamic environment. Indeed, the benefits of the burgeoning NewSpace industry extend beyond the United States. International collaboration and competition in this area can lead to faster technological advancements and economic gains. The global NewSpace landscape is driving down costs, increasing access to space, and fostering innovation that can improve not only economic well-being, but also impact national security models. To that end, this memo will examine the broad state of the space market, discuss the industry drivers, and propose recommendations for US and allied policymakers as they consider future government investments in those enabling space-based activities that support wider national security ambitions.
Topic:
Defense Policy, International Trade and Finance, National Security, Science and Technology, European Union, Space, and Defense Industry
Political Geography:
Russia, China, Eurasia, Canada, Asia, and United States of America

18. In Support of Market-Driven Standards

Author:
Matthias Bauer, Fredrik Erixon, Oscar Guinea, and Vanika Sharma
Publication Date:
03-2023
Content Type:
Working Paper
Institution:
European Centre for International Political Economy (ECIPE)
Abstract:
The EU published its new Standardisation Strategy in 2022. The strategy contains some good ideas to improve the way European standards are set. However, in its attempt to gain more control over technical standards, the EU risks killing the goose that lays the golden egg. The primary motivation behind the strategy is the belief that the process governing the way CEN, CENELEC, and ETSI – the three European Standardisation Organisations – take decisions over EU standards favours non-EU multinationals. To address this perceived imbalance, EU National Standardisation Bodies will have the exclusive power to accept standardisation requests, and adopt, revise and withdraw European technical standards. These changes are particularly significant for ETSI, Europe’s Standardisation Body in charge of telecommunication standards and one of Europe’s most successful organisations. ETSI is a prime example of EU normative power since it hosts companies from more than 60 countries, while retaining a large membership of EU firms. The regulatory changes included in the strategy are not risk-free. There could be unintended consequences that may undermine a standardisation system that has delivered significant economic benefits for the EU and the world. First, giving more responsibility to EU’s National Standardisation Organisations will turn a European discussion into 30 (EU and EEA) national debates. As a consequence, small companies will not be able to contribute to each and every one of the National Standardisation Organisations, diluting their contribution, while multinational companies, with the resources needed to cooperate with a larger number of bodies, will benefit from an expanding role in the EU standard setting process. Second, if standards are fragmented along national borders and companies must multiply their efforts to take part in several Standardisation Development Organisations, there will be less resources for Research and Development spending. Finally, if each and every National Standardisation Organisation needs to have a position with regards to the acceptance of a standardisation request, or adoption, revision and withdrawal of European technical standards, the time period required to adopt a technical standard may be extended rather than shortened, which is the exact opposite of what the European Commission wants to achieve. The regulatory changes included in the EU Standardisation Strategy are akin to cracking a nut with a sledgehammer. If the European Commission is concerned about the influence of non-EU companies in European Standardisation Bodies, it does not need to overhaul their governance systems. Supporting greater participation of European firms in the European standard system will ease EU’s concerns without the downside risks associated with changing the rules of the game that govern Europe’s Standardisation Bodies. The success of the European standardisation system, which is market-driven and based on consensus, has had significant economic benefits in the development of specific industries, like the European Information and Communication Technologies (ICT). Technical standards in ICT have shaped a European industry that is not only dynamic and international but also enjoys some of the highest levels of wages and Research and Development spending. Moreover, if technical standards are not developed through an open, consensus-based, and industry-led voluntary process, they will be developed in different ways. For instance, governments and private companies can develop standards by themselves. Both solutions are inferior to the current market-driven approach that governs European standards. However, the European market-driven approach to set standards is voluntary, and its success and continuation must not be assumed. European policymakers should be worried about tinkering with a European standardisation system which has produced economic specialisation and innovation to the benefits of EU firms and consumers.
Topic:
Markets, European Union, Regulation, Economy, and Standardization
Political Geography:
Europe

19. What is Wrong with Europe’s Shattered Single Market? – Lessons from Policy Fragmentation and Misdirected Approaches to EU Competition Policy

Author:
Matthias Bauer
Publication Date:
04-2023
Content Type:
Working Paper
Institution:
European Centre for International Political Economy (ECIPE)
Abstract:
What is wrong with Europe’s Single Market? The brief answer to that question is that it does not really exist – it is unsingle. The Single Market is in many ways a political illusion. It exists only nominally. Any company doing business in Europe faces significant barriers to cross-border exchanges within the EU, and it is these barriers that hamper companies’ ability to scale and compete internationally on the back of innovation and economic integration. We outline that Brussels and national governments need to beat the drum for eliminating policy fragmentation in Europe’s internal market and at the same time change course in competition policy to sufficiently support investments in innovation, business growth, and the adoption of advanced technologies across industries. Major economic indicators show that Europe is caught in a protracted corporate and technology crisis. The EU has for a very long time now been tailing US corporate and innovation leadership. At the same time, competition with technology-intensive imports from China is getting increasingly intense. Europe’s underperformance is rooted in a legally fragmented internal market which is disincentivising business growth and innovation. On top of that, an outdated approach to competition policy is discouraging businesses from adopting innovation and scaling across national borders, risking that EU companies continue to lose clout and international competitiveness. 30 years have passed since the formal establishment of Europe’s Single Market. Data reveals that regulatory convergence has reversed or come to a halt in most policy areas. Recent policies for technologies and digital business models, which are key sources of cross-industry competitiveness, created new layers of regulation and legal uncertainty in EU and Member State law. Overall, EU policies have not significantly helped European companies, large and small, to do business in another Member State or use advanced technology-enabled services. EU competition policy does not live up to its promise to “enable the proper functioning of the EU’s internal market”. Europe’s competition policy is still fragmented along national borders and largely ignorant to dynamic effects of competition, especially investments in innovation. Due to mixed legal competences, competition rules are often enforced differently by Member States’ national authorities and can be appropriated to support protectionist industrial policy ambitions. The recently enacted Digital Market Act (DMA) demonstrates that the European Commission and Member State authorities favour protection and discretionary enforcement over innovation and economic disruption, without providing solid evidence of abusive business behaviour and consumer harm. With the DMA, the EU introduced legislation with serious ambiguities in objectives, concepts, and rules, and explicitly allows national Member States to regulate competition at their own discretion. A recent attempt by Germany’s competition authority, the Bundeskartellamt, to enforce its own rulebook for large digital companies (Section 19a of the German Competition Act) risks creating a patchwork of competition rules for large providers of advanced digital services across the EU. Local adopters of advanced digital services, particularly small businesses, that use advanced technology services to compete in their markets would be confronted with less choice and quality. Recently imposed policies under the umbrella of European Strategic Autonomy will hardly help policymakers in their ambition to achieve “innovation and technology leadership”. The paramount task for the EU and national governments is to eliminate policy fragmentation in Europe’s internal market, accompanied by an approach to competition policy that embraces investments in innovation and business growth while accounting for the substantial value created through the adoption of innovative technologies and disruptive business models across industries in the EU.
Topic:
Markets, European Union, Economy, and Competition
Political Geography:
Europe

20. Strategic Autonomy and the Competitiveness of Europe’s Innovative Pharmaceutical Sector: A Wake-up Call

Author:
Fredrik Erixon and Oscar Guinea
Publication Date:
04-2023
Content Type:
Working Paper
Institution:
European Centre for International Political Economy (ECIPE)
Abstract:
It is high time for Europe to break its relative decline in the pharmaceutical sector. Europe used to be the preeminent region in the world for Research and Development and innovation in the sector – being the location for a majority of R&D and the development of new medicines. However, its competitiveness has been going down for several decades – and, in more recent time, the pace of the decline is now accelerating. Europe is not just outpaced by the United States. Unless there is a new direction, China will soon be ahead of Europe too. Europe is behind the global frontier in innovation and new product development in medicines. It is not just Europe’s share of global R&D that is going down. Of all the new chemical and biological entities that are developed, Europe is contributing a falling share. There is a similar development in the drug pipeline – medicines that are in the regulatory approval process. The location of clinical trials for Advanced Therapy Medicinal Products – an area of new frontline drug development – is moving out of Europe. If Europe is to improve its strategic autonomy and restore competitiveness in the pharmaceutical sector, better policies are needed to incentivise innovation and attract R&D investment. A new strategy for the pharmaceutical industry should include – among other things – better protection of intellectual property, more and focused R&D expenditures, and streamlined regulatory and reimbursement processes.
Topic:
European Union, Pharmaceuticals, Strategic Autonomy, Research and Development, and Competition
Political Geography:
Europe

21. Increasing Systemic Legal Risks in the EU: The Economic Impacts of Changes to the EU’s Product Liability Legislation

Author:
Matthias Bauer and Elena Sisto
Publication Date:
06-2023
Content Type:
Working Paper
Institution:
European Centre for International Political Economy (ECIPE)
Abstract:
The EU’s Product Liability Directive (PLD) determines the rules for strict product liability in the EU. It establishes a framework in which manufacturers’ liability is determined solely based on the presence of defects in the product, regardless of the manufacturer’s fault. The PLD is intended to serve as a “safety net” when fault-based or contractual liability rules do not offer sufficient compensation to consumers. It operates independently from contractual arrangements between businesses and consumers, and it cannot be weakened by contractual agreements between businesses and consumers. The PLD is a horizontal regulation that applies to a wide range of industries in the EU because it applies to all products available on the EU market. The recently proposed changes by the European Commission would increase systemic legal uncertainty for producers and sellers of technology-intensive goods and services in the EU. The impact assessment of the European Commission does not sufficiently account for changes to the PLD proposed in 2022. Nor does it sufficiently account for the major impacts of increased legal uncertainty for European businesses. Legislators in the Council and the European Parliament should slow negotiations to allow time for policymakers to collect more evidence on the impacts on businesses, insurers, and courts we detail in this paper. This would be an opportunity to improve regulatory quality in light of the high levels of legal uncertainty associated with the changes proposed by the Commission.
Topic:
Economics, European Union, Legislation, and Risk
Political Geography:
Europe

22. Erdoğan's Re-election as President Raises Concerns among Allies

Author:
Aleksandra Maria Spancerska
Publication Date:
06-2023
Content Type:
Working Paper
Institution:
The Polish Institute of International Affairs
Abstract:
Recep Tayyip Erdoğan’s win in the presidential election and ministerial appointments promises to further weaken democracy, move Türkiye further away from EU standards, and continue so-called personal diplomacy and transactionalism in foreign policy. This could prolong the Turkish parliament’s ratification of Sweden’s accession to NATO.
Topic:
Foreign Policy, NATO, Diplomacy, Elections, European Union, and Recep Tayyip Erdoğan
Political Geography:
Europe, Turkey, Middle East, and Sweden

23. EU-South Korea Extend Cooperation Beyond the Economy

Author:
Oskar Pietrewicz
Publication Date:
06-2023
Content Type:
Working Paper
Institution:
The Polish Institute of International Affairs
Abstract:
The 10th EU-Republic of Korea Summit, held on 22 May in Seoul, reaffirmed the importance of South Korea as a critical Asian partner of the Union. The meeting also signalled the growing importance of security issues in bilateral relations. South Korea shares the EU’s assessment of Russian aggression against Ukraine and intends to continue to support the invaded country, but not with supplies of military equipment for now. The announcement of a “green” partnership indicates both sides’ willingness to engage in other areas of cooperation, which also will benefit the development of Polish-South Korean relations.
Topic:
Security, International Cooperation, Bilateral Relations, and European Union
Political Geography:
Europe, South Korea, and Poland

24. EU Development Cooperation Policy Shifts from Charity to Self-interest

Author:
Patryk Kugiel
Publication Date:
06-2023
Content Type:
Working Paper
Institution:
The Polish Institute of International Affairs
Abstract:
In recent years, the EU’s development cooperation policy has evolved, moving away from an approach based on poverty eradication and the needs of partner countries to focusing more on its own interests. This change is supported by the majority of EU members. This gives the EU the opportunity to exert strategic influence in the world but risks the loss of its unique identity as an altruistic donor and attractive partner in development cooperation. The change in the Union’s approach is consistent with the position of Poland, which can use it to reform and strengthen its development aid system.
Topic:
Development, Regional Cooperation, European Union, and Development Aid
Political Geography:
Europe and Poland

25. Using Frozen Russian Assets to Rebuild Ukraine: Possibilities for the EU

Author:
Elzbieta Kaca
Publication Date:
05-2023
Content Type:
Working Paper
Institution:
The Polish Institute of International Affairs
Abstract:
The EU wants to finance the reconstruction of Ukraine, using for this purpose frozen Russian assets, among others. The European Commission proposes to improve the system of confiscation of private assets of sanctioned persons in case of criminal activity and to obtain income from the active management of immobilised Russian public assets. These solutions may yield limited results. To be more effective, the EU would have to reach an international agreement to confiscate the reserves of the Central Bank of the Russian Federation.
Topic:
Sanctions, Reconstruction, European Union, Assets, and Russia-Ukraine War
Political Geography:
Russia, Europe, and Ukraine

26. Businesses, EU Strengthening International Supply Chains

Author:
Piotr Dzierżanowski
Publication Date:
04-2023
Content Type:
Working Paper
Institution:
The Polish Institute of International Affairs
Abstract:
Over the past three years, global supply chains have experienced problems on an unprecedented scale. Given the rising political tensions and changes in the perception of the role of the economy in international rivalries, a return to international economic relations based on globalisation and trade liberalisation is highly unlikely. Instead, we will witness a necessary strengthening of supply chains, both at the individual business and national levels. For Western economies, the main challenge will be the reduction of related costs.
Topic:
Globalization, European Union, Economy, Business, and Supply Chains
Political Geography:
Europe and Global Focus

27. Triggering the Rule-of-Law Conditionality Mechanism against Hungary

Author:
Veronika Jóźwiak
Publication Date:
03-2023
Content Type:
Working Paper
Institution:
The Polish Institute of International Affairs
Abstract:
The mechanism that makes the payment of funds from the EU budget conditional on compliance with the principles of the rule of law is the newest instrument for protecting the Union’s financial and political interests. The tool allows the European Commission and the EU Council (Council) to exert influence on Member States that violate the fundamental principles of the Community. Triggering it against Hungary might result in a reduction of EU funds to the country as a consequence of rule-of-law violations for the first time in EU history. It is doubtful, however, that this will lead to systemic changes in Hungary.
Topic:
European Union, Rule of Law, European Commission, and Regional Politics
Political Geography:
Europe and Hungary

28. Refugees from Ukraine Adapting to the European Labour Market

Author:
Jolanta Szymańska
Publication Date:
03-2023
Content Type:
Working Paper
Institution:
The Polish Institute of International Affairs
Abstract:
Due to the length of the war in Ukraine, more and more refugees from this country have decided to take up employment in the EU. Preliminary data indicate that they are integrating into European labour markets faster than refugees from other regions. However, the mismatch between their jobs and qualifications remains a challenge. Despite the refugees’ inclusion, the deteriorating economic situation in Europe may lead to negative perceptions in host countries.
Topic:
Economics, European Union, Refugees, and Labor Market
Political Geography:
Russia, Europe, and Ukraine

29. China Adapts Policy in Response to Russia's Aggression Against Ukraine

Author:
Marcin Przychodniak
Publication Date:
03-2023
Content Type:
Working Paper
Institution:
The Polish Institute of International Affairs
Abstract:
China perceives the Russian aggression against Ukraine as an expression of resistance to the U.S. and NATO hegemony and an important element of building a new international order that marginalises the West. Based on this, China is strengthening strategic cooperation with Russia, striving to weaken the international position of the U.S., the EU, and their partners, while testing reactions to a possible escalation of Chinese actions towards Taiwan, for example. President Xi Jinping expressed this policy course during his March visit to Russia. At the same time, China is trying to gain support from the countries of the Global South. This approach means a continuation of China’s assertive policy towards the European Union, among others.
Topic:
Foreign Policy, NATO, European Union, and Russia-Ukraine War
Political Geography:
Russia, China, Europe, Ukraine, and Asia

30. With Charisma, Stick, and Carrot: Reviewing the Effectiveness of EU Climate Diplomacy

Author:
Zuzanna Nowak and Stefania Kolarz
Publication Date:
02-2023
Content Type:
Working Paper
Institution:
The Polish Institute of International Affairs
Abstract:
Last year’s COP27 in Sharm el-Sheikh, Egypt, was a major challenge for EU climate diplomacy, which, despite the unfavourable external circumstances (e.g., the war in Ukraine and economic turbulence), contributed to the conference’s positive outcome. The EU, as a global leader in the fight against climate change, seeks to increase its influence with external partners. Many of them would not have joined the climate action without its support. In addition to participation in policy dialogue, among the EU’s main tools of influence are various types of incentives and forms of support, as well as leverage measures such as political conditionality. However, the effectiveness of these tools is still being refined.
Topic:
Climate Change, Diplomacy, European Union, and Influence
Political Geography:
Europe

31. EU Seeks Greater Transparency in Wake of EP Corruption Scandal

Author:
Tomasz Zając
Publication Date:
02-2023
Content Type:
Working Paper
Institution:
The Polish Institute of International Affairs
Abstract:
The European Parliament (EP) corruption scandal, which began with the arrests of then current or former MEPs last December, showed that the mechanisms in place to ensure institutional transparency do not sufficiently protect against the influence of non-EU countries. In addition, the parliament’s internal standards are of limited effectiveness as penalties for non-compliance are not very severe and rarely applied. The effect of the scandal will most likely be to further increase the transparency of EP conduct. The probability of a new body to monitor ethical issues in EU institutions has also increased.
Topic:
Corruption, European Union, Transparency, and European Parliament
Political Geography:
Europe

32. EU Member States Take a Position on the Emigration of Russians

Author:
Aleksandra Kozioł and Stefania Kolarz
Publication Date:
01-2023
Content Type:
Working Paper
Institution:
The Polish Institute of International Affairs
Abstract:
Hundreds of thousands of Russians have decided to emigrate as Vladimir Putin’s regime has increased repression of citizens with dissenting views of the government or unwilling to participate in the war in Ukraine. Some of them are trying to enter the EU, justifying it with humanitarian reasons. However, the Member States, which decide the granting of visas and residence permits, have different practices. Elaborating a unified approach remains a major challenge for the EU.
Topic:
Migration, European Union, Civilians, and Russia-Ukraine War
Political Geography:
Russia and Europe

33. Member States Seek to Unmask Russian Espionage in the EU

Author:
Elzbieta Kaca
Publication Date:
01-2023
Content Type:
Working Paper
Institution:
The Polish Institute of International Affairs
Abstract:
Russian intelligence services are actively developing their networks of spies in the EU. While Member States are trying to counteract this and are undertaking coordinated action, many of them have limited operational capacities. Their cooperation at the EU level is hampered by differences in threat perceptions and a lack of mutual trust. With the aim of developing common competences, EU diplomacy can inform Member State societies about the growing scale of espionage threats by publishing regular reports on this subject.
Topic:
Intelligence, European Union, Espionage, and Threat Perception
Political Geography:
Russia, Europe, and Ukraine

34. Section 232 reloaded: the false promise of the transatlantic ‘climate club’ for steel and aluminium

Author:
David Kleimann
Publication Date:
07-2023
Content Type:
Working Paper
Institution:
Bruegel
Abstract:
In using the removal of Section 232 ‘national security’ tariffs on steel and aluminium imports as a bargaining chip, the United States demands that the European Union engage in negotiations on “global steel and aluminium arrangements to restore market-oriented conditions and address carbon intensity”. The US demand has reportedly been inspired by a blueprint that would establish an international institutional arrangement – labelled a ‘climate club’ – which would externalise market-access restrictions afforded by US Section 232 tariffs to the customs borders of club members. While the declared objective is to incentivise non-members to adopt low-carbon steel (and aluminium) production methods the US blueprint suffers from various design flaws including inefficient incentives, WTO inconsistency and incompatibility with the EU Carbon Border Adjustment Mechanism. The effectiveness of the proposed US scheme is severely compromised by the plethora of policy objectives it pursues, which go far beyond the goal of incentivising industrial decarbonisation in third countries, including secondary (ie protectionism) and tertiary (ie global power competition with China) objectives. The initial negotiation proposal submitted by the United States Trade Representative (USTR) to European Commission trade negotiators incorporates many if not all the problematic elements of this blueprint, setting the US on a collision course with the negotiation proposal put forward by the European Commission. This paper concludes that the adoption of the scheme proposed by USTR would result in a step backwards for international climate and trade cooperation, whereas not adopting the EU proposal would make for a missed opportunity. Given the sharply diverging negotiation positions and associated respective domestic constraints on both sides, however, policymakers should start to engage stakeholders now to manage expectations towards a low-ambition negotiation result, if any.
Topic:
Security, Climate Change, Industrial Policy, Governance, European Union, Economy, Trade Policy, and Transatlantic Relations
Political Geography:
Global Focus

35. What should be done about Google’s quasi-monopoly in search? Mandatory data sharing versus AI-driven technological competition

Author:
Bertin Martens
Publication Date:
07-2023
Content Type:
Working Paper
Institution:
Bruegel
Abstract:
The first part of this paper focuses on competition between search engines that match user queries with webpages. User welfare, as measured by click-through rates on top-ranked pages, increases when network effects attract more users and generate economies of scale in data aggregation. However, network effects trigger welfare concerns when a search engine reaches a dominant market position. The EU Digital Markets Act (DMA) imposes asymmetric data sharing obligations on very large search engines to facilitate competition from smaller competitors. We conclude from the available empirical literature on search-engine efficiency that asymmetric data sharing may increase competition but may also reduce scale and user welfare, depending on the slope of the search-data learning curve. We propose policy recommendations to reduce tension between competition and welfare, including (a) symmetric data sharing between all search engines irrespective of size, and (b) facilitate user real-time search history and profile-data portability to competing search engines. The second part of the paper focuses on the impact of recent generative AI models, such as Large Language Models (LLMs), chatbots and answer engines, on competition in search markets. LLMs are pre-trained on very large text datasets, prior to usage. They do not depend on user-driven network effects. That avoids winner-takes-all markets. However, high fixed algorithmic learning costs and input markets bottlenecks (webpage indexes, copyright-protected data and hyperscale cloud infrastructure) make entry more difficult. LLMs produce semantic responses (rather than web pages) in response to a query. That reduces cognitive processing costs for users but may also increase ex-post uncertainty about the quality of the output. User responses to this trade-off will determine the degree of substitution or complementarity between search and chatbots. We conclude that, under certain conditions, a competitive chatbot markets could crowd out a monopolistic search engine market and may make DMA-style regulatory intervention in search engines redundant.
Topic:
Science and Technology, Governance, European Union, Digital Economy, Innovation, Artificial Intelligence, and Competition
Political Geography:
Europe

36. What would Europeans want a European defence union to look like?

Author:
Francesco Nicoli, Brian Burgoon, and David Van der Duin
Publication Date:
06-2023
Content Type:
Working Paper
Institution:
Bruegel
Abstract:
While the Russian invasion of Ukraine has created a new momentum for EU defence integration, the political feasibility of such integration remains disputed, as it may entail both additional financial costs and a loss of sovereignty. Furthermore, design of defence integration is inherently multidimensional, differing in terms of scope and level, governance and sources of financing, among other dimensions. To determine the extent of public support for European security cooperation, we conducted the first conjoint experiment ever fielded on public support for alternative defence union designs. We carried out a pre-registered, randomised conjoint experiment on a highly representative sample of the French, German, Italian, Dutch and Spanish populations in November 2022. This multidimensional conjoint experiment allows us to determine the causal link between policy features of potential defence pacts, and public support or opposition to such policy. Our results show that policy packages receiving the most support require joint EU-level governance, joint purchases of military equipment through joint procurement, and repurposing of existing national expenditure as the preferred form of financing. All in all, our results show not only that there is considerable cross-border support for defence integration in Western Europe, but also that citizens in different Western European countries have generally aligned preferences regarding the actual design of such policy, indicating that a compromise policy is feasible and publicly supported. Furthermore, our results support ongoing research on the nature of European solidarity at times of crisis, suggesting that European citizens are willing to support the creation of joint institutions and policies to face issues of common concern, and therefore indicating that major crises open important windows of opportunity to re-shape EU-level policies and institutions.
Topic:
Defense Policy, Governance, European Union, and Regional Security
Political Geography:
Europe

37. China’s quest for innovation: progress and bottlenecks

Author:
Alicia Garcia-Herrero and Robin Schindowski
Publication Date:
06-2023
Content Type:
Working Paper
Institution:
Bruegel
Abstract:
As the Chinese economy continues to decelerate, the central government is investing heavily in innovation, doubling down on research and development (R&D) spending and STEM-oriented human capital. In this paper, we assess China’s progress so far, looking at the inputs to innovation (R&D and human capital) as well as intermediate targets, such as scientific research and patents. We then evaluate how China has fared with respect to the ultimate goal of commercialising this progress, by looking at the value-added of Chinese exports and the overall productivity of the economy. We identify three potential bottlenecks that might be hindering the translation of China’s innovation efforts into productivity growth.
Topic:
Industrial Policy, European Union, Economic Growth, Innovation, and COVID-19
Political Geography:
China, Europe, and Asia

38. Antitrust issues raised by answer engines

Author:
Christophe Carugati
Publication Date:
06-2023
Content Type:
Working Paper
Institution:
Bruegel
Abstract:
Rapid development of generative artificial intelligence chatbots like ChatGPT is leading search engine providers to move from search to answer engines. Unlike search engines, which provide search results in the form of blue links to content creators, answer engines generate personalised answers through a conversation with end users. This revolution impacts the internet ecosystem of content creators and the digital advertising market. This paper outlines some early antitrust issues related to answer engines, from the transition from search to answer engines (sections 2 and 3) and the response competition authorities should adopt (section 4). It finds that search and answer engines complement and compete with each other. While the answer-engine market is still at an early stage of development, it already raises some competition issues in relation to data scraping, vertical integration and unfair terms and conditions. Intervention by competition authorities is more likely than not to prevent market power in this new market. In this regard, competition authorities should act to preserve dynamic competition and minimise adverse effects on content creators. Finally, the paper concludes with several research questions for future research (section 5).
Topic:
Science and Technology, Governance, European Union, Digital Economy, Innovation, Artificial Intelligence, and Competition
Political Geography:
Europe

39. Global trends in countries‘ perceptions of the Belt and Road Initiative

Author:
Alicia Garcia-Herrero and Robin Schindowski
Publication Date:
04-2023
Content Type:
Working Paper
Institution:
Bruegel
Abstract:
Drawing on global media reports, we conduct a sentiment analysis of the image of China’s Belt and Road Initiative (BRI) and the evolution of its image over time. Our main finding is that perceptions of the initiative deteriorated significantly in many geographies from 2017 to 2022. The notable exception is in sub-Saharan Africa where the BRI’s image remains positive, even if slightly less so than in the past. This is notwithstanding increases in debt levels with China, much of which now face potential restructuring. Furthermore, we find significant inter- and intra-regional differences in the average sentiment towards China’s landmark project, as well as a much worse image of the initiative in countries which, until today, are not part of the BRI. Finally, we focus on the European Union, Africa and China’s immediate neighbourhood to better understand the complexities behind the perceived benefits and challenges associated with China’s Belt and Road Initiative.
Topic:
Bilateral Relations, European Union, Geopolitics, Economy, and Trade
Political Geography:
China, Europe, and Asia

40. Pro- and anti-competitive provisions in the proposed European Union Data Act

Author:
Bertin Martens
Publication Date:
01-2023
Content Type:
Working Paper
Institution:
Bruegel
Abstract:
The proposed European Union Data Act gives users access and portability rights to the data generated by their use of tangible digital products and devices. This pro-competitive measure weakens the de-facto monopolistic control product manufacturers have over product data. However, the Data Act would also grant manufacturers a de-jure right to monopolistic pricing of data transfers to third-party service providers, restoring their control over data markets. Other anti-competitive provisions include restrictions on the use of data for competition purposes and a prohibition on transfering data to platforms identified as gatekeepers under the EU Digital Markets Act. Unnecessarily fuzzy definitions of products and data that fall under the Data Act would create uncertainty in implementation and incoherence with other EU data regulations. The Data Act should be simplified by dropping anti-competitive provisions and granting users and third-parties selected by users free access to all data generated by the use of a product or a service. This would increase competition in data-driven services and prevent users paying twice for their data. It would not disincentivise producers from investing in data-driven products and services. A further step could be the creation of a level playing field between producers and users in data-access rights. This can be achieved by introducing the principle of mutual exhaustion of data rights at point of sale. This would put all data co-generating parties in a position to generate economies of scale and scope in data aggregation, or data-driven externalities, to maximise innovation.
Topic:
Markets, Governance, European Union, and Digital Economy
Political Geography:
Europe

41. Rebooting the European Union’s Net Zero Industry Act

Author:
Simone Tagliapietra, Reinhilde Veugelers, and Jeromin Zettelmeyer
Publication Date:
06-2023
Content Type:
Working Paper
Institution:
Bruegel
Abstract:
In March 2023, the European Commission published a legislative proposal for an EU response to the US Inflation Reduction Act: the Net Zero Industry Act (NZIA). It is an unconvincing policy proposal, both for what is in it and for what is not in it. The proposal has five problematic aspects. First, it takes a top-down approach, in which specific technologies are selected for preferential treatment. Preferable would be a technology-neutral approach open to all current and future technologies that help tackle the net-zero challenge. Second, its blanket 40 percent self-sufficiency benchmark for EU domestic cleantech manufacturing by 2030 sends a protectionist signal, is poorly defined and does not reflect the differences in EU capacity in the cleantech sector. Third, it relies on the acceleration of permitting procedures as the main policy instrument, although this is not the main obstacle to cleantech investment in the EU. Fourth, it proposes more strategic use of public procurement. While this is an objective to be supported, the specific proposals are likely to be ineffective because of the way they are designed. Fifth and not least, the NZIA would lack a governance structure that would ensure effective implementation. In addition, the NZIA does not tackle three critical issues. It does not address investment obstacles related to failures of the single market. It does not tackle the coordination problem at the core of developing an EU green industrial policy. Finally, it does not develop an EU-level funding strategy, but rather relies on state aid, with the related risk of fragmentation. The European Parliament and EU countries in the Council of the EU should reboot the proposal and refocus its objectives, sharpening its limited instruments, improving its governance, and adding financial incentives to ensure implementation. In parallel, the EU should develop a broader green industrial policy strategy that leverages the single market in a credible manner, building a solid new governance framework and a new EU-level funding approach.
Topic:
Climate Change, Industrial Policy, Governance, European Union, Trade Policy, and Industry
Political Geography:
Europe

42. The rising cost of European Union borrowing and what to do about it

Author:
Gregory Claeys and Conor McCaffrey
Publication Date:
05-2023
Content Type:
Working Paper
Institution:
Bruegel
Abstract:
Debt issuance by the European Commission on behalf of the European Union has increased massively. Of the approximately €400 billion in outstanding EU debt as of May 2023, 85 percent has arisen from borrowing since 2020. Large-scale borrowing is expected to continue until 2026 to fund the remainder of NextGenerationEU, and concessional loans to support Ukraine. When these programmes were launched, interest rates were at historic lows – even negative for maturities below 10 years. However, interest rates rose sharply in 2022. Beyond the widespread rise in euro-denominated interest rates due to monetary tightening by the European Central Bank in response to the inflation surge, the EU has also faced a widening of the spread between its yields and those of major European issuers, including France and Germany. This widening is driven by a combination of market features, circumstantial factors and institutional features. The EU cannot affect the overall cyclical movement of interest rates and will have to learn to live with it, like sovereigns do. However, the European Commission should continue to try to narrow the spread with major European sovereigns by further developing the relevant market infrastructure and improving its issuance strategy. The Commission will not be able to do this alone. Institutional developments, including progress on the development of new own resources and a long-term substantial presence in the bond market, will be necessary to fully reap the benefits of EU borrowing. A large share of EU borrowing (around €421 billion in total by the end of 2026, in current prices) is intended to finance unprecedented non-repayable support: Recovery and Resilience Fund grants and additional funding for existing EU programmes under the EU budget. The interest costs associated with this part of the debt lie with the EU budget. Our estimates suggest that, because of the high current and expected levels of interest rates, this cost could be twice as high as what was initially estimated at the start of the EU’s 2021-27 budget cycle. As a result, because interest costs for the borrowing of the non-repayable support are accounted for under the EU budget’s ‘expenditure ceiling’, this will exert further pressure on the funding of important EU programmes, which are already affected by inflation. The EU should thus quickly review how interest costs are accounted for in its budget and financial framework.
Topic:
Debt, Budget, European Union, and European Commission
Political Geography:
Europe

43. Phased European Union electricity market reform

Author:
Georg Zachmann and Conall Heussaff
Publication Date:
03-2023
Content Type:
Working Paper
Institution:
Bruegel
Abstract:
In an environment of record-breaking electricity prices driven by a gas supply shock and below-average electricity generation, reforming the design of the European electricity market is seen as a means to delink consumer costs from volatility in short-term power markets. Electricity markets should meet three objectives: fairness, optimal investment and optimal operation. The current market design has achieved these objectives to varying degrees. Faced with the unprecedented shock, the electricity system has operated well, but electricity markets have struggled to achieve fair outcomes and investments have not been driven by market-based cashflows. Further complicating market reform, the power system is being changed radically by decarbonisation. The electricity system is becoming more decentralised and digitalised, with an active demand side. These transformations will have consequences for the optimal electricity market design in the later stages of the energy transition. Reform proposals have focused on increasing the share of long-term contracts in the remuneration of generation technologies. Different long-term contracting regimes have structural implications for the functioning of electricity markets, especially in relation to the roles of the state and the market, and the responsibilities of national governments and European Union institutions. A phased approach should be taken to EU electricity market design reform. In the near-term, reform should seek to protect consumers and drive investment. An assessment should also be made of what market design will best meet the fairness, investment and operational objectives in a decarbonised system, and what the conceptual role of electricity markets should be during the transition. This process should start as soon as possible so well thought-through proposals are available when the next European Commission takes office.
Topic:
Markets, Reform, European Union, Electricity, and Green Economy
Political Geography:
Europe

44. Assessing Digital Leadership: Is the EU Losing out to the US?

Author:
Dario Guarascio and Roman Stöllinger
Publication Date:
03-2023
Content Type:
Working Paper
Institution:
The Vienna Institute for International Economic Studies (WIIW)
Abstract:
Since Leontief’s (1953) seminal work on the factor content of trade, the validity of the Heckscher-Ohlin-model has been judged not only on the basis of formal tests of the theory but also tested against prior expectation. In this vein, this paper uses the Heckscher-Ohlin-Vanek (HOV) approach to investigate whether supposed US leadership in the digital domain can be traced back to digital task endowments embodied in labour services. In a comparison between EU member states and the US, we find that the latter is more intensive in digital tasks than the EU and that this difference is explained by both an intensity-effect (US occupations being more digital-task intensive) and a structural component (relatively more digital-task intensive occupations). Viewed through the lens of the HOV theorem we find that the US is abundant in digital tasks relative to non-digital tasks, while the opposite is true for the EU. The standard tests for the predictive power of the HOV theorem are high and in line with the results for labour in previous literature.
Topic:
International Trade and Finance, Foreign Direct Investment, European Union, Digitalization, and Competition
Political Geography:
Europe and United States of America

45. Functional Specialisation and Working Conditions in Europe

Author:
Sandra Leitner, Roman Stöllinger, and Zuzana Zavarská
Publication Date:
05-2023
Content Type:
Working Paper
Institution:
The Vienna Institute for International Economic Studies (WIIW)
Abstract:
Specialisation in value-chain functions is one of the new phenomena introduced by global value chains (GVCs). This report investigates the effects of functional specialisation on labour markets in fabrication and R&D activities as the two polar cases of value-chain functions, whereby the former is associated with factory economies, while the latter is characteristic of headquarter economies. More precisely, a metric similar to revealed comparative advantage is used to study the effect of relative functional specialisation on wages and non-wage working conditions. In line with the GVC literature emphasising power relations and organisational aspects of production networks, we are able to identify differentiated effects for functional specialisation patterns on wages in EU member states at the industry level across time. While relative functional specialisation in fabrication tends to hold back wages, functional specialisation in R&D has a positive effect on wage progression, controlling for labour productivity, GVC participation and numerous labour supply- and labour demand-side factors. The use of a constructed ‘sharp’ instrument allows giving these results a causal interpretation. Conversely, both functional specialisation measures are found to improve some non-wage working conditions, namely workers’ physical environment and their work intensity, which is evidence against a potential ‘race to the bottom’ effect of functional specialisation along GVCs. The effect is stronger for relative specialisation in fabrication than for relative specialisation in R&D.
Topic:
International Trade and Finance, Labor Issues, Foreign Direct Investment, European Union, Labor Market, Value Chains, and Wages
Political Geography:
Europe

46. Determinants of Functional Specialisation in EU Countries

Author:
Aleksandra Kordalska and Magdalena Olczyk
Publication Date:
05-2023
Content Type:
Working Paper
Institution:
The Vienna Institute for International Economic Studies (WIIW)
Abstract:
This paper aims to identify factors that determine functional specialisation (FS) in global value chains (GVCs) in European Union countries. We focus on fabrication and R&D as two opposite business functions in terms of their character and their potential of creating value-added. To make our results robust two different approaches to measuring functional specialisation are used – an FDI-based approach and a trade-based approach. To assemble a relative functional specialisation index, for each approach we use the same metric – a revealed comparative advantages index. Our results suggest a positive effect of wages on specialisation in an R&D function, and a negative impact on FS in fabrication. Increasing labour productivity boosts both specialisation in fabrication and in R&D. The results are robust to different model specifications and different time intervals. The instrumental variables method allows us to interpret the results as causal relationships. Additionally, human capital and labour skills foster FS in R&D (only in FDI data), and growing employment makes FS in fabrication increase. The growth of GDP per capita positively affects functional specialisation in R&D activities. Among GVC participation measures, we confirm the importance of increasing backward linkages to explain the boost in fabrication activities. Dividing a full sample into a group of EU15 countries and a group of Central Eastern European countries we observe that patterns for the EU15 are similar to those for the full sample, while for CEE countries wages are insignificant and labour productivity affects FS in fabrication only.
Topic:
International Trade and Finance, Foreign Direct Investment, European Union, Economy, Value Chains, and Competition
Political Geography:
Europe

47. FACTORING THE SMART POWER IN THE INDIA-EUROPEAN UNION ENGAGEMENTS: A SCOPING REVIEW

Author:
Nippun Gupta, Bawa Singh, Aslam Khan, and Jaspal Kaur
Publication Date:
03-2023
Content Type:
Working Paper
Institution:
Institute for Research and European Studies (IRES)
Abstract:
Power is a critical factor in several types of diplomacy. India-EU relations are a classic case of how changing geopolitics prompted diplomatic acumen. This scoping review assesses the changing relations of both partners as a manifestation of Smart Power. The dynamic relations from normative-based to pragmatic and inclusive interests based are evaluated. Their value-based relations are put under international relations theories. Their changing factors of cooperation are used to justify their smart diplomacy, where contemporary relations are less likely to be affected by multilateral interests. To solidify claims of smart power in their relations, the recent TRIPS waiver schism illuminated health diplomacy between the two regions. This health diplomacy discourse promotes smart power diplomacy between India and the EU, where new avenues of cooperation emerge despite pandemic disagreements. The article explores how hybrid power is better than soft and hard power in silos by systematically searching and selecting the existing knowledge in the contemporary context.
Topic:
Diplomacy, Health, Bilateral Relations, European Union, Soft Power, Hard Power, and Smart Power
Political Geography:
Europe, South Asia, and India

48. Exchange Rate Pass-Around

Author:
Matthieu Crozet, Julian Hinz, and Federico Trionfetti
Publication Date:
04-2023
Content Type:
Working Paper
Institution:
Kiel Institute for the World Economy (IfW)
Abstract:
In January 2015, The Swiss Franc (CHF) appreciated unexpectedly against the Euro by approximately 15%. We document a new fact: French firms that exported to both the Swiss market and the Eurozone also exhibited a sudden change in their export prices to the Eurozone. We coin this the “exchange rate pass-around” effect. We rationalise this fact with a simple model based on the endogenous decision of some firms to give up pricing-to-market and opt for single-pricing to all markets. An important implication of this finding is that single-pricing may be one of the causes of the incomplete pass-through. This mechanism has so far remained unexplored in the literature, which may have led to overestimating the importance of other factors. Based on monthly French export data, our empirical analysis confirms the existence of the pass-around. Firms directly affected by the CHF exchange rate shock increased their prices in neighboring markets by 0.8% compared to other exporters. The effect was stronger for firms with lower ex-ante price heterogeneity across markets and for firms with smaller trade costs to Switzerland. However, the effect was short-lived. As time passed, exporters tended to decouple the prices they set on the Swiss market from those for the Eurozone, and the pass-around effect faded.
Topic:
International Trade and Finance, Markets, Monetary Policy, European Union, and Exchange Rate Policy
Political Geography:
Europe

49. Potential efficiency gains from the introduction of an emissions trading system for the buildings and road transport sectors in the European Union

Author:
Wilfried Rickels, Christian Rischer, Felix Schenuit, and Sonja Peterson
Publication Date:
05-2023
Content Type:
Working Paper
Institution:
Kiel Institute for the World Economy (IfW)
Abstract:
In the European Union (EU), a second emissions trading system (EU ETS2) covering buildings, road transport and small energy and industrial installations is expected to be introduced from 2027. Until 2030, however, EU ETS2 will not be a separate pillar of EU climate policy, but will support Member States in meeting their national targets under the Effort Sharing Regulation (ESR). If there are net regional shifts in emission reductions within the EU ETS2, for example, if companies in one member state buy in aggregated terms net allowances, this must be compensated for at the national level. We study the EU ETS2 for the year 2030 using the general equilibrium model DART. In our analysis, the introduction of an EU ETS2 generates about a quarter of the efficiency gains of a comprehensive emissions trading system, assuming that nation states use the flexibility mechanisms of the ESR and compensate for regional abatement leakage through interstate emissions trading. However, this is only true if there is no extensive price stabilization in the EU ETS2. Our analysis suggests an EU ETS2 allowance price of around EUR 300/tCO2. Stabilizing the EU ETS2 price at the envisaged intervention price of 45 EUR/tCO2 would require about 415 million additional allowances and thus imply additional emissions of the same amount in 2030 alone.
Topic:
Climate Change, European Union, Economy, and Carbon Emissions
Political Geography:
Europe

50. Made in Europe: An EU Green Industrial Plan to respond to the challenge of US and Chinese protectionism

Author:
Alekos Kritikos and George Pagoulatos
Publication Date:
01-2023
Content Type:
Working Paper
Institution:
Hellenic Foundation for European and Foreign Policy (ELIAMEP)
Abstract:
The EU needs to urgently formulate a response to US and Chinese protectionism. US decarbonization legislation poses a threat of deindustrialization for Europe. Europe needs a plan to support EU green, industrial and technological competitiveness, while protecting European cohesion and the single market, and promoting European strategic autonomy. Relaxing EU state aid rules must be an inevitable first component of Europe’s response. But this would overwhelmingly benefit the stronger economies of Germany and France, undermining EU cohesion and the integrity of the single market. Thus, the second component of EU response must be a European Sovereignty Fund, of a size commensurate to the magnitude of the challenge. The new Fund must support value chain categories that include as many EU member states as possible. SURE, extended to encompass the energy crisis and green transition, should be an integral part of the mix, and so should promoting technological skills and reskilling for the “Clean Tech Economy”. Investment funding should seek to contribute to vertical integration, including as many stages in the supply chain as possible. It should contribute to the return of specific supply chains and production units from third countries to the EU and seek to include the EU’s weakest economies. Subsidies should rise if the investment is cross-border in nature and carry a bonus if made in an EU region with a low GDP per capita compared to the EU average. Funding could also promote European strategic autonomy by including cross-border partnerships of EU member states in the defence technology industry. It should involve new funding rather than simply recycling money from existing programmes, and certainly avoid deploying undisbursed resources from the Recovery & Resilience Fund.
Topic:
European Union, Investment, Industry, Protectionism, and Strategic Autonomy
Political Geography:
China, Europe, and United States of America

51. Drafting Greece’s “Internal Security Strategy” – Challenges and Prospects

Author:
Panayotis Tsakonas and Triandafyllos Karatrantos
Publication Date:
03-2023
Content Type:
Working Paper
Institution:
Hellenic Foundation for European and Foreign Policy (ELIAMEP)
Abstract:
The radical change in the structure of the international system caused a scientific and political revolution in the definition and concept of security. Issues such as the climate crisis, forced displacements and extreme nationalism have led the interest and especially the debate on achieving security from external to internal threats. The focus is now on the main “object of reference” of security which is not the state or some sub-state groups, but “the individual”/”the citizen”. In the modern globalized environment, all the risks that threaten the daily life of citizens require dealing with the concept of security in a “holistic” and, at the same time, more “human-centered” way. Greece lacks an institutional document for the internal security strategy. There are structural reasons that make a comprehensive reform of the internal security sector necessary. In addition to the established weaknesses and inadequacies of specific agencies and/or services of the internal security system, the overall organic interconnection between crisis management services is still required. The first lesson from the effects of the pandemic is the need for the evolution of Greece into a “Modern National Security State”. Greece, due to its geographical position on the external borders of the EU, as well as the crises it has experienced in recent years, faces a series of internal security threats and challenges. Security and respect for fundamental rights are not mutually conflicting but coherent and complementary objectives. The Strategy will help build an internal security governance system and a central coordination process.
Topic:
Security, Governance, and European Union
Political Geography:
Europe and Greece

52. The EU’s approach to climate mobility: Which way forward?

Author:
Helena Hahn and Melanie Fessler
Publication Date:
10-2023
Content Type:
Working Paper
Institution:
European Policy Centre (EPC)
Abstract:
Climate mobility as a global issue needs strategic thinking about how people adapt, and the role mobility can play in alleviating the adverse effects of climate change. This Discussion Paper analyses what the EU is doing to deal with climate mobility. It addresses the complicated relationship between climate change, mobilities, and related challenges in modelling and projecting future scenarios. It also shows the multilateral policy developments relating to climate and migration and the EU’s actions on climate mobility, with a focus on two interrelated challenges: 1. Policy (in)coherence and counterproductive narratives. 2. Weak institutional coordination. The EU’s funding landscape is also addressed, focusing on the challenges of mainstreaming and monitoring when assessing the funds dedicated to this cause. It concludes with recommendations on impacts, multilateral engagement, policy, and funding, which outline practical steps to be taken in the short and long-term.
Topic:
Climate Change, European Union, and Mobility
Political Geography:
Europe

53. Towards common accord? The European Union contemplates treaty change

Author:
Andrew Duff
Publication Date:
10-2023
Content Type:
Working Paper
Institution:
European Policy Centre (EPC)
Abstract:
Numerous events have conspired to tempt the European Union to reform the way it is governed. Present constitutional arrangements were laid down in the Treaty of Lisbon in 2007 and are long overdue for revision. In recent months, parallel efforts have been made by the European Parliament and European Commission to articulate a prospectus for treaty amendment. The Council remains fearful and inarticulate, divided over the content and timing of any such reform. Andrew Duff returns to the current debate with a Discussion Paper analysing the EU treaty change. He previews emerging proposals from the European Parliament and European Commission, referring to the recent report of the Franco-German experts as well as other relevant contributions.
Topic:
Treaties and Agreements, European Union, Regional Integration, European Parliament, and European Commission
Political Geography:
Europe

54. Ending the HIV epidemic in Europe: Moving toward the 2030 sustainable development goals

Author:
Elizabeth Kuiper and Danielle Brady
Publication Date:
11-2023
Content Type:
Working Paper
Institution:
European Policy Centre (EPC)
Abstract:
Despite significant progress, the human immunodeficiency virus (HIV) epidemic continues to pose a public health threat in Europe. The COVID-19 pandemic has exacerbated challenges by disrupting healthcare services and diverting attention and resources away from HIV prevention and treatment. Stigma and discrimination against those affected by HIV persist and are additional obstacles, slowing down progress to end the HIV epidemic. This Discussion Paper explores the current HIV prevalence in Europe, identifies barriers and challenges, and offers policy recommendations to overcome these obstacles and meet the sustainable development goals targets in Europe. The Paper emphasises the need for renewed political commitment and cooperation among the EU and its member states to prioritise HIV as well as for strong partnership and collaboration between authorities and stakeholders concerned, ultimately striving for success in ending the epidemic.
Topic:
HIV/AIDS, European Union, Public Health, and COVID-19
Political Geography:
Europe

55. Violence against women: A public health crisis

Author:
Victoria Pedjasaar
Publication Date:
11-2023
Content Type:
Working Paper
Institution:
European Policy Centre (EPC)
Abstract:
In the EU, a third of women over the age of 15 have experienced physical or sexual violence and over half have been sexually harassed. Although often overlooked, the majority of (workplace) violence takes place in the healthcare sector as healthcare professionals are 16 times more at risk of violence in comparison to other occupations. Violence does not only manifest in abusive behaviour toward workers on duty but can also be perpetrated on women as receivers of healthcare. High rates of violence in healthcare, brought on and exacerbated by gender stereotypes and inequality, point to dysfunctional health systems. This Discussion Paper provides policy recommendations on the way forward for the EU member states, taking a closer look at: Gender-based violence against healthcare workers. Obstetric and gynaecological violence against women. Gender-based violence as a story of gender inequality. Legislation and policies that protect women.
Topic:
European Union, Women, Inequality, Gender Based Violence, and Legislation
Political Geography:
Europe

56. Resetting the EU’s business model after the watershed

Author:
Marco Buti and Marcello Messori
Publication Date:
02-2023
Content Type:
Working Paper
Institution:
European Policy Centre (EPC)
Abstract:
The EU’s response to the COVID-19 pandemic raised hopes of an acceleration towards deeper economic and political integration. Most optimists saw Next Generation EU as a paradigm shift that would result in the establishment of a permanent central fiscal capacity. Such hopes were reinforced by the Russian aggression against Ukraine; if not now, when? While the EU displayed remarkable unity in sanctioning Russia, the hopes for another leap forward in integration have not yet materialised. This Discussion Paper argues that the current crisis is more existential than the pandemic, as it questions Europe’s business model: an energy-intensive, mercantilist production setup is not sustainable going forward, for domestic and global reasons. It also argues that the EU’s reaction to the US Inflation Reduction Act may be a break: preserving the single market prohibits a go-it-alone policy constituted of exclusively national reactions. Going forward, the authors believe there needs to be an effective centralised strategy based on three overarching considerations: (i) The EU needs a new industrial policy to reinforce value chains, close technology gaps with the US and China, and improve its economic model's competitive advantages; (ii) The implementation of this policy requires the EU's member states to be less risk averse and more open to common solutions; (iii) A necessary, though not sufficient, condition for a cooperative game is an effective implementation of the national Recovery and Resilience Plans that give access to the Recovery and Resilience Facility’s funds. Achieving those goals is key to rebuilding political trust, reviving the ‘Next Generation EU spirit’, and mitigating the impact of the war in Ukraine on the European economy.
Topic:
Industrial Policy, European Union, Business, Regional Integration, and Value Chains
Political Geography:
Europe

57. Addressing Cohesion Policy’s identity crisis in a changing European Union

Author:
Alison Hunter
Publication Date:
02-2023
Content Type:
Working Paper
Institution:
European Policy Centre (EPC)
Abstract:
Since the late 1980s Cohesion Policy has been one of the cornerstone policies of the European Union. However, nowadays, a different, bolder Cohesion Policy debate is needed, reflecting a radically changed global environment. This Discussion Paper focuses on the upcoming review of the post-2027 Multi Annual Financial Framework and the debate concerning the future EU Cohesion Policy. It argues that Cohesion Policy’s purpose requires reinvention, not an incremental upgrade. Four overarching themes are analysed, reframing Cohesion Policy with a strategic, long-term investment perspective: EU resilience, security, strategic autonomy, and reforms. The author then proposes five recommendations which weave together these themes with the policy’s long-standing core features: Acknowledge the need to review the Cohesion Policy’s purpose. The EU should breathe new life into the Cohesion Policy debate. Revitalise Cohesion Policy’s long-term value by defending its pillars. The EU should re-confirm Cohesion Policy’s role as a structural policy. Position Cohesion Policy as the ‘guardian’ of EU place-based policymaking. Cohesion Policy should champion the “future-proofing” of regional resilience. Articulate Cohesion Policy’s role in the evolving EU governance and reform agenda. The EU should reach beyond the Recovery and Resilience Facility to reclaim Cohesion Policy’s role in structural reform. Improve Cohesion Policy’s convening power to catalyse deeper EU innovation cooperation. The future Cohesion Policy must deliver a more coordinated approach to the EU’s innovation agenda. The Paper concludes that the future Cohesion Policy should evolve in lockstep with citizens’ needs. This will not be easy. As discussions on the EU’s future have been sidelined in this crisis-prone area, the challenges ahead require strong leadership and coordination. The post-2027 EU Cohesion Policy will have much to contribute to rebuilding the EU’s future vision.
Topic:
Security, Governance, Reform, European Union, Regional Integration, Social Cohesion, Resilience, and Strategic Autonomy
Political Geography:
Europe

58. Raising the stakes on constitutional reform: The European Parliament triggers treaty change

Author:
Andrew Duff
Publication Date:
03-2023
Content Type:
Working Paper
Institution:
European Policy Centre (EPC)
Abstract:
The European Parliament, for the first time, has used its powers to trigger a revision of the EU treaties. Its central demand is to change the decision-making procedure behind the passerelle clause from unanimity to qualified majority voting. However, the EU Council has so far refused to submit Parliament’s request to the European Council — in breach of its treaty obligations. At the same time, MEPs continue to develop wider reform proposals to make the government of the EU more robust, decisive, and democratic. With the European Parliamentary elections taking place next year, now is a good time for parliamentarians to take stock of their own performance, review their place in the governing system of the Union, and, other things being equal, prepare for future reform. In this Discussion Paper, Andrew Duff explains that, in an ideal world, more could be achieved under the existing treaties, and the EU could avoid the always complex, often unpopular, and usually protracted task of revising them. With another treaty change on the cards, the Paper analyses the current state of affairs and suggests that the heads of government need the assistance of a reflection group to prepare for a new Convention.
Topic:
Treaties and Agreements, Reform, European Union, Constitution, and European Parliament
Political Geography:
Europe

59. Quantum technologies and value chains: Why and how Europe must act now

Author:
Georg Riekeles
Publication Date:
03-2023
Content Type:
Working Paper
Institution:
European Policy Centre (EPC)
Abstract:
As next-generation foundational technologies, quantum computing, communication, and sensing carry significant economic and security implications that go to the core of today’s strategic competition. In contrast with the US, where Big Tech actors dominate, Europe’s strengths lie in a vibrant ecosystem of research organisations and start-ups. This growing ecosystem is now at a critical juncture to develop into an internationally competitive European industry. This paper is based on research and a series of workshops conducted with European policymakers, stakeholders and industry actors looking into Europe’s technological position in contested international value chains. It proposes ten recommendations for the EU’s industrial policy mix under the following headings: KNOW – Embrace tech forecasting at the EU level COOPERATE – Combine European efforts in an EU Quantum Industrial Alliance INVEST – Mobilise European public-private capital for industrial scale-up PROTECT – Deploy Europe’s defensive toolbox prudently In a year that will see the launch of the EU Sovereignty Fund and adoption of the European Chips Act, quantum stands as a test case for the EU’s technological competitiveness and industrial policy agenda.
Topic:
Security, Economics, European Union, Industry, Quantum Computers, and Value Chains
Political Geography:
Europe

60. Funding the EU’s external migration policy: ‘Same old’ or potential for sustainable collaboration?

Author:
Evangelia (Lilian) Tsourdi, Nasrat Sayed, and Federica Zardo
Publication Date:
04-2023
Content Type:
Working Paper
Institution:
European Policy Centre (EPC)
Abstract:
In this Discussion Paper, the authors examine changes in the EU funding landscape relating to migration policy and provide recommendations on how to maximise the benefits of cooperation. Since 2015, when the EU was first exposed to a significant rise in irregular arrivals from neighbouring countries, funding has acquired increasing salience, leading to the mobilisation of €7 billion through Trust Funds and the creation of a specific heading devoted to migration and border management in the EU’s Multiannual Financial Framework 2021-2027. The authors look closely at the funding dimension of Talent Partnerships, the latest initiative to support legal migration to the EU, and the contradictions. Given funding’s ability to enhance cooperation with third countries, the Paper focuses on how the EU could take several steps toward ensuring sustainable collaboration. These include moving towards long-term planning, embedding transparency guarantees in the operationalisation of its initiatives, scaling up Talent Partnerships for more impactful and mutually beneficial cooperation, and striving for third-country ownership. Furthermore, in the context of growing political and economic instability around the world, financial resources should equally be used to address the different components of migration processes, such as local development, legal migration, circular migration, integration, but also displacement and forced (im)mobilities. At the same time, long-standing issues of accountability and transparency should be addressed through new instruments. The conditions through which funding can act as a catalyst for sustainability and co-development are also analysed, and recommendations are provided on the next steps for EU action.
Topic:
Migration, European Union, Borders, and Transparency
Political Geography:
Europe

61. The US-EU Trade and Technology Council: Assessing the record on data and technology issues

Author:
Juan Carlos Fernández-Rodríguez and Frances G. Burwell
Publication Date:
04-2023
Content Type:
Working Paper
Institution:
European Policy Centre (EPC)
Abstract:
Since its creation, the Trade and Technology Council (TTC) has endorsed a Declaration for the Future of the Internet (DFI), designed a Joint Roadmap for transatlantic cooperation on artificial intelligence (AI) and identified quantum technology as a high priority. While these achievements can be considered success stories, this Discussion Paper argues that the TTC is now facing a dilemma. Different approaches to technology and digital governance and the lack of regulatory autonomy make the TTC best suited to address emerging issues that do not require changes in legislation. Yet, this is precisely what stakeholders want it to address. So, how can the TTC ensure its continuity without regulatory authority? The Paper offers five key recommendations: Make AI a test case and build from the lessons of the Joint AI Roadmap; Engage in issues where there is an initial strong value alignment and no regulation; Work on moonshot ideas such as the “metaverse” or low-earth orbit governance; Take oversight over the special task forces it has created to tackle critical issues such as the US Inflation Reduction Act (IRA); Think more actively about how to push its efforts into multilateral forums with like-minded partners.
Topic:
Science and Technology, European Union, Trade, and Data
Political Geography:
Europe, North America, and United States of America

62. One step closer to getting the EU Migration Pact done. One step closer to ambitious change?

Author:
Alberto-Horst Neidhardt
Publication Date:
06-2023
Content Type:
Working Paper
Institution:
European Policy Centre (EPC)
Abstract:
On 8 June, the Swedish Presidency put to the vote compromise texts on two vital elements of the EU asylum system: the rules governing the processing of asylum applications and those determining the state responsible for applicants, including a corresponding solidarity mechanism. A turning point was Italy getting on board after some concessions were made on how to apply the notion of safe third countries, making it easier to carry out returns to transit countries. Poland and Hungary voted against the proposals, and four other countries abstained – Malta, Bulgaria, Lithuania, and Slovakia – paving the way for the “historic” agreement. This Discussion Paper asks: What factors shaped the vote? What will future negotiations focus on, and what will be the impact of the reforms on the ground? Finally, what should come after the New Migration Pact? Trialogue negotiations are about to start, and the stakes have never been this high in EU asylum and migration policies. If the negotiations do not deliver reforms that can improve the European asylum system, it will undermine trust between member states, citizens’ confidence in the EU and its capacity to manage the migration phenomenon.
Topic:
Migration, European Union, and Asylum
Political Geography:
Europe

63. Towards a cleaner air in Europe: Time for a stronger vision and more action

Author:
Annika Hedberg, Stefan Sipka, Simon Dekeyrel, Melanie Fessler, and Danielle Brady
Publication Date:
07-2023
Content Type:
Working Paper
Institution:
European Policy Centre (EPC)
Abstract:
As scientific evidence on the impact of air pollution on human life continues to grow, accepting air pollution as a given side product of our economies and activities can no longer be tolerated. This Discussion Paper highlights what the EU needs to do to recognise clean air for what it is: a necessary component for healthy societies, people and long-term economic prosperity and social well-being in Europe. A stronger vision and framework for action is needed, and this paper recommends what the EU needs to do next. Have a stronger vision and framework for action by: Adopting an ambitious and comprehensive clean air agenda; Making cleaner air an integral part of the EU’s vision and framework for greater well-being; Improving enforcement of the air quality standards and monitoring; Raising awareness about the causes of air pollution, benefits of action and measures to be taken. Provide concrete measures to address air pollution by: Ensuring all key sectors, including agri-food, industry, energy and mobility, play their role; Encouraging, empowering and enabling regional, local and citizen action.
Topic:
European Union, Public Health, and Air Pollution
Political Geography:
Europe

64. A quantum cybersecurity agenda for Europe

Author:
Andrea García Rodríguez
Publication Date:
07-2023
Content Type:
Working Paper
Institution:
European Policy Centre (EPC)
Abstract:
Cybersecurity plays an important role in Europe’s economic security. However, advances in quantum computing create a new set of challenges that compromise the level of security of everything happening online. Actors like the United States and some — but not all — EU member states are already taking action to counter current and emerging threats. Yet, European coordination will be necessary to ensure a harmonised and effective response. This Discussion Paper provides recommendations on how the EU could enhance its efforts to navigate cybersecurity risks. These include: 1. Establishing an EU Coordinated Action Plan on the quantum transition. 2. Establishing a new expert group within the European Union Agency for Cybersecurity with seconded national experts to exchange good practices and identify obstacles to the transition to post-quantum encryption. 3. Assisting in setting priorities for the transition to post-quantum encryption and pushing for cryptographic agility to respond to emerging vulnerabilities. 4. Facilitating political coordination between the European Commission, member states, national security agencies and ENISA to determine technological priorities and identify use cases for quantum-safe technologies. 5. Facilitating technical coordination at the EU level to address research gaps in quantum-safe technologies. 6. Exploring the use of sandboxes to accelerate the development of near-term applications of quantum information technologies.
Topic:
European Union, Cybersecurity, and Economic Security
Political Geography:
Europe

65. Soldiers out, civilians left behind: EU lessons from the evacuation of Kabul

Author:
Mihai Sebastian Chihaia and Georg Riekeles
Publication Date:
08-2023
Content Type:
Working Paper
Institution:
European Policy Centre (EPC)
Abstract:
This is the introduction to a three-part Report that reviews the evacuation of Kabul, and the combined failures of NATO and the EU, amid the war in Ukraine. Even if Europe’s security debate has moved on to this bigger and more pressing challenge, the EU must heed the lessons from Kabul as it reviews its crisis management architecture and implements the Strategic Compass. The exact conditions of the Afghanistan evacuation might not be seen again for many years. Still, the EU must consider a range of other scenarios: European soldiers or citizens in danger needing evacuation from failing states or war zones, military support for humanitarian assistance and disaster relief, or even short-term stability support to governments and initial entry missions. This requires a commitment to, and building of, EU rapid deployment capacities that are effectively ready to be used, associated with appropriate crisis management structures for EU decision-making. These are the questions that have interested this project, whose examination is structured in three parts: A description of the central decision moments leading up to and during the evacuation from Afghanistan. An assessment of the main factors contributing to failure in anticipation, planning and execution. Recommendations regarding the EU’s crisis management architecture and capacity in the context of the implementation of the Strategic Compass.
Topic:
Security, NATO, and European Union
Political Geography:
Afghanistan, Europe, and South Asia

66. EU-Ukraine wartime trade: Overcoming difficulties, forging a European path

Author:
Svitlana Taran
Publication Date:
08-2023
Content Type:
Working Paper
Institution:
European Policy Centre (EPC)
Abstract:
During the first year of Russia’s war in Ukraine, EU trade-liberalisation measures and EU-Ukraine Solidarity Lanes provided Ukraine with alternative export routes and allowed the country to reorient part of its exports to the EU market. However, the insufficient logistics capacity and lack of adequate coordination and cooperation during the operation of Solidarity Lanes led to tensions between Ukraine and its Eastern European neighbours. While a compromise between the European Commission and the Eastern European countries allowed the extension of temporary trade-liberalisation measures for a further year, resolving the immediate crisis, more is needed to ensure their smooth operation. This Discussion Paper provides recommendations on how the EU can further intensify efforts to facilitate Ukraine’s trade flows and prevent sudden trade disruptions and restrictions. These include: Enhance the strategic alignment and connectivity between Ukraine and the EU; Ensure security guarantees and increase the capacity of seaport corridors; Enhance coordination and unity between the Commission, EU member states and Ukraine; Avoid sudden and unjustified Solidarity Lanes' disruptions; Protect critical port and export infrastructure from Russia’s attacks; Facilitate EU-Ukraine trade liberalisation and Ukraine’s integration into the EU Single Market.
Topic:
Security, European Union, Trade Liberalization, Trade, and Russia-Ukraine War
Political Geography:
Russia, Europe, and Ukraine

67. Is the European Health Union ready for the challenges of the 21st century?

Author:
Elizabeth Kuiper and Danielle Brady
Publication Date:
09-2023
Content Type:
Working Paper
Institution:
European Policy Centre (EPC)
Abstract:
The COVID-19 pandemic laid bare national health systems' unpreparedness and structural weaknesses. It also emphasised the disparities in national capabilities among European countries and the lack of a common European approach against cross-border health threats. As we enter a post-pandemic era, this Discussion Paper assesses the proposals under the European Health Union and sets out recommendations to address the identified shortcomings. These include: Adopting a more holistic approach by appointing a Vice President for Well-being. Strengthening crisis preparedness by elevating HERA to an agency. Promoting access and affordability by extending joint procurement. Strengthening the European health workforce by tackling shortages and addressing skills gaps. Mitigating the cost of inaction by increasing investment in health. Ensuring planetary health by promoting a Green European Health Union. Promoting Europe’s status as a global leader in health data by harmonising health data regulations with the European Health Data Space. Safeguarding the EU’s strategic autonomy by implementing the Versailles Declaration and strengthening supply chain resilience. Building on the EU’s Global Health Strategy by exploring global partnerships. This Paper builds on the findings of the European Policy Centre’s Task Force on the European Health Union. The multistakeholder Task Force was held under the auspices of the EPC's Social Europe and Well-being programme with the kind support of Amgen, MSD, Johnson&Johnson, SITRA and EIT Health.
Topic:
European Union, Public Health, COVID-19, and Strategic Autonomy
Political Geography:
Europe

68. Planetary health: A holistic vision for people and the planet

Author:
Danielle Brady
Publication Date:
09-2023
Content Type:
Working Paper
Institution:
European Policy Centre (EPC)
Abstract:
The nexus between health and the environment has been underscored by crises such as COVID-19 and the climate crisis. As awareness of policy interlinkages grows, so does the need for more coordinated EU and national policymaking. Calls for a more holistic approach have long been recognised, but the pandemic has further emphasised the importance of dismantling existing barriers in policymaking to improve the health status of people, animals, and the planet. This Discussion Paper, funded by Sitra, the Finnish Innovation Fund, advocates for implementing a planetary health approach across all levels of governance to encourage transdisciplinary action and puts forward ten recommendations: Pursue coordinated policymaking by breaking down silos. Appoint an Executive Vice President for the Well-being Economy. Plan and implement national roadmaps and establish common indicators. Create best practices platforms. Adopt planetary health for health systems. Promote education on planetary health. Adopt a European-wide communication campaign. Invest in research and innovation. Foster the integration of the European Health Data Space with future data spaces. Work with international partners to adopt a global planetary health approach. Planetary health offers many benefits for health and the environment. However, without concentrated efforts to move beyond the traditional siloed approach to policymaking, the benefits may never be realised.
Topic:
Climate Change, Health, European Union, and COVID-19
Political Geography:
Global Focus

69. The Nexus Approach: Bringing together climate, human security, and demographic change in times of permacrisis

Author:
Eleonora Milazzo
Publication Date:
10-2023
Content Type:
Working Paper
Institution:
European Policy Centre (EPC)
Abstract:
The start of a new institutional cycle and the development of the European Council's Strategic Agenda will raise concerns about the EU's ability to respond to multiple problems in a more systemic and conscious style. Therefore, a holistic nexus approach that combines greater inter- and intra-institutional collaboration with strategic vision and principled leadership will be essential if the EU is to deliver on complex challenges. It will play a vital role in the EU’s ability to deal with today’s permacrisis with regard to climate change, human security, and demographic transformations. This Discussion Paper retraces the genesis of the nexus approach in humanitarian and development cooperation to draw lessons learned for the EU’s strategic thinking around systemic and deeply interconnected problems. It shows how a conscious strategic vision, more coherence, and principled leadership will be crucial if the EU is to tackle complex challenges effectively.
Topic:
Climate Change, Demographics, European Union, Crisis Management, and Human Security
Political Geography:
Europe

70. The Fate of Flat Tax in the EU countries

Author:
Krassen Stanchev
Publication Date:
12-2023
Content Type:
Working Paper
Institution:
Center for Social and Economic Research - CASE
Abstract:
Since 1989, flat tax (FT) reforms have been attempted in Europe and the EU only by ex-communist countries and Iceland. In the 1990s all ex-communist countries lowered and simplified their income taxes, often starting with corporate taxes. In the late 1990s and early 2000s they also reformed their social security systems. In many respects the tax reforms have never stopped, but with regard to income taxation they are less radical than in the 1990s and at the turn of this century. Even when there were reforms re-establishing progressive taxation, they have almost never returned to complex sets of nominal rates and a steep vertical ladder of progressive thresholds. This report attempts to reconstruct the reasons why EU countries moved to introduce proportional taxation on either corporate or personal income, or both, as well as the reasons behind five of them returning to progressive taxation. These reforms happened in different political and economic contexts. It would be difficult to identify unequivocal causality between flattening taxes and economic performance. However, the report compares the dynamics of economic growth and factors related to competitiveness for periods before and after the reforms were launched. The same effort has been made for indicators of wealth and disposable income. The analysis allows for a discussion of lessons learnt and of the prospects for further reforms. The report concludes that it seems impossible to prove that FT systems have been a key contributor to higher economic growth. However, it does seem that, if the social security contributions remain relatively stable and are financed by other tax revenues, they have a positive impact on fiscal performance and general welfare.
Topic:
Reform, European Union, Economic Growth, Tax Systems, Corporate Tax, and Flat Tax
Political Geography:
Europe and Post-Soviet Europe

71. The EU and CT-P/CVE in its external action

Author:
Dylan Macchiarini Crosson, Tatjana Stankovic, Pernille Rieker, and Steven Blockmans
Publication Date:
07-2023
Content Type:
Working Paper
Institution:
Centre for European Policy Studies (CEPS)
Abstract:
This article re-frames the ongoing democracy versus security debate surrounding the European Union’s (EU) policies to counter terrorism and prevent/counter violent extremism (CT-P/CVE). Indeed, extant literature has primarily focused on how the EU’s CTP/CVE-specific emphasis on security concerns has come at the expense of attention towards good governance and social justice, thereby undermining the effectiveness of its approach. After reviewing general concepts discerned from previous research on the EU’s CT-P/CVE policy, tracing its approach over time, analysing key documents, and conducting interviews with policymakers, this analysis finds that the EU – in its words, funding, and policy implementation – also pays significant CT-P/CVE-relevant attention to the structural causes of radicalisation to violent extremism and terrorism by mobilising significant developmentoriented resources and diplomatic energy. By doing so, the EU’s CT-P/CVE policies balance an emphasis on security concerns and broader socio-economic and diplomatic engagement. However, the EU simultaneously de-emphasises good governance and peacebuilding, which must be reinforced and mainstreamed across its primary developmental engagement for the EU’s CT-P/CVE approach to be considered fully fit-for-purpose.
Topic:
Security, Terrorism, Governance, Violent Extremism, European Union, Democracy, and Peacebuilding
Political Geography:
Europe

72. One year of war in Ukraine

Author:
Christian Leffler
Publication Date:
03-2023
Content Type:
Working Paper
Institution:
Centre for European Policy Studies (CEPS)
Abstract:
It has been just over one year since Russia began its brutal war of aggression against Ukraine. In that year, the EU has stepped up and provided copious amounts of support to Ukraine – economic and military, as well as providing a safe haven for millions of Ukrainians who have fled the fighting. As the conflict has now entered its second year, this CEPS Explainer dives deep to analyse what has defined the first year and then expands on what the EU needs to concretely do in the second if Ukraine is to have any hope of triumphing over the invaders. This will require vision, courage and boldness from European leaders. The alternative if they fail? A rules-based international order replaced by a ruthless multipolar world defined by competing spheres of influence.
Topic:
European Union, Armed Conflict, International Order, and Russia-Ukraine War
Political Geography:
Russia, Europe, and Ukraine

73. The Sunshine Problem: Climate Change and Managed Decline in the European Union

Author:
Timur Ergen and Luuk Schmitz
Publication Date:
12-2023
Content Type:
Working Paper
Institution:
Max Planck Sciences Po Center on Coping with Instability in Market Societies (MaxPo)
Abstract:
Decarbonization requires the winding down of – economically – fully viable, if not highly prosperous, lines of economic activity. Different from past episodes of industrial restructuring revolving around the managed decline of sunset industries, accelerating climate change requires reallocation away from economic activities where the metaphorical sun is still shining. Firms, owners, workers, regions, and polities structurally rely on these sources of prosperity and have interwoven their past and future lives with them. We argue that this problem has created a space for state actors to experiment with vertical industrial policies to manage the reallocation of resources from polluting to non-polluting activities. We illustrate this dynamic by investigating the least-likely case of the European Union, a polity heavily tilted towards market governance. European climate policymakers, we argue, have incrementally moved away from the primacy of regulatory, market-making tools and have introduced a plethora of vertical instruments to shift resources away from climate-harming fields. This experimentation with vertical policies unfolds against the backdrop of a thirtyyear institutional legacy of single market-oriented policy in the energy field.
Topic:
Climate Change, Industrial Policy, European Union, Social Cohesion, and Green Transition
Political Geography:
Europe

74. The EU and the Transformed Nuclear Context since the War in Ukraine

Author:
Clara Portela
Publication Date:
06-2023
Content Type:
Working Paper
Institution:
Istituto Affari Internazionali
Abstract:
The invasion of Ukraine by Russian forces in February 2022 has entirely transformed the European security landscape, bringing war to the European Union’s doorstep. Importantly, the war features a nuclear dimension that manifests itself in consequential ways, including Moscow’s nuclear sabre-rattling and its denunciation of the last surviving nuclear arms control treaty. This unleashed intriguing reactions, like a surprisingly tough resort to sanctions by the EU, or the shrinking of neutrality on the continent. However, while support for nuclear deterrence has increased in some NATO countries, support for arms control remains strong too. Meanwhile, nuclear disarmament advocates have not shifted their stance as a result of the crisis.
Topic:
Defense Policy, Arms Control and Proliferation, Nuclear Weapons, Weapons of Mass Destruction, European Union, Nonproliferation, and Russia-Ukraine War
Political Geography:
Russia, Europe, and Ukraine

75. Factsheet: Manfred Weber

Author:
Bridge Initiative Team
Publication Date:
03-2023
Content Type:
Working Paper
Institution:
The Bridge Initiative, Georgetown University
Abstract:
Manfred Weber is a German politician who has served as President of the European People’s Party (EPP) since 2022, and as Leader of the EPP Group in the European Parliament since 2014. He has been a Member of the European Parliament (MEP) from Germany since 2004. He is a member of the Christian Social Union in Bavaria (CSU), which is a member of the EPP. Weber has made statements alleging that Muslims and Islam are a threat to European culture.
Topic:
European Union, Islamophobia, Catholic Church, Xenophobia, Christian Social Union, and European People's Party (EPP)
Political Geography:
Europe, Germany, and Austria

76. Factsheet: Stop Extremism

Author:
Bridge Initiative Team
Publication Date:
08-2023
Content Type:
Working Paper
Institution:
The Bridge Initiative, Georgetown University
Abstract:
Stop Extremism is a Europe-wide initiative demanding a stronger fight against extremism. It wants to introduce a joint EU-wide watch list of individuals and organizations that are labeled as extremists. A number of its proponents and supporters have a history of making discriminatory claims about Muslims and supporting anti-Muslim legislation in the name of defending liberal values.
Topic:
Violent Extremism, European Union, Discrimination, Islamophobia, and Muslims
Political Geography:
Europe

77. The EU-CEAP Impacts on Developing Countries: An Analysis of the Plastic Packaging, Electric Vehicles and Batteries Sectors

Author:
Jenny To
Publication Date:
01-2022
Content Type:
Working Paper
Institution:
German Institute of Development and Sustainability (IDOS)
Abstract:
The European Union Circular Economy Action Plan (EU-CEAP) is key to transitioning to a circular economy and climate neutrality under the EU Green Deal – and developing and emerging countries (DECs) play important roles. They are essential for primary material chains, for example, for electric vehicle batteries. DECs are also part of secondary material chains, and Europe relies on them to recycle its plastic packaging. Despite the crucial roles that DECs play in Europe’s transition to a circular economy, literature and policy discourses have not yet examined the EU-CEAP’s impact. This discussion paper fills this gap by outlining the EU-CEAP’s challenges and opportunities for DECs and presents recommendations for development cooperation.
Topic:
Climate Change, Development, European Union, Batteries, Electric Vehicles, and Plastic
Political Geography:
Europe

78. Mexico’s “Catch-22”: The Implications of Being a Trade and Climate Partner of the United States and the European Union

Author:
Simone Lucatello
Publication Date:
01-2022
Content Type:
Working Paper
Institution:
German Institute of Development and Sustainability (IDOS)
Abstract:
Under the current global environmental governance and trade regimes, several initiatives, such as the new United States–Mexico–Canada Agreement, the European Union’s European Green Deal, and regional free trade agreements the European Union has implemented with strategic partners like Mexico, are prompting a vibrant discussion on how trade agreements can be used as a potential mechanism to create enforceable cross-border commitments to tackle climate change. However, to cut greenhouse gas emissions within a few decades, a decisive departure from current trends in emission and trade policies is required by all countries, both developed and developing. As a result, politicians, scholars and experts around the world have looked to trade agreements as a possible tool for reaching global climate commitments, either related to or independent from the Paris Agreement. But how well do these agreements suit this purpose? Carbon-intensive products worldwide increased when tariff reductions were implemented, resulting in destructive practices for many countries, particularly those in the Global South. For countries such as Mexico, the nexus between trade and climate change is not easy to address: the country is trapped between its ambitions to play a role in global trade platforms as an industrial manufacturer and agricultural exporter and its desire to be recognized as a global actor in climate change policy and actions within the global community. Despite recent changes in climate and environmental politics under the administration of President Andrés Manuel López Obrador (2018–2024), Mexico is a middle-income country with a long-standing tradition as climate champion and environmental leader in the Global South and needs to make clear where it stands under the new global environmental and ecological transition scenario imposed by the climate crisis and trade-related issues. The “entanglement” of global trade treaties and commitments under the current climate crisis, represents a major shift for Mexico. Caught between the new US–Mexico-Canada Agreement, the EU–Mexico Trade Agreement and the possible impacts of the European Green Deal, Mexico needs to define its role in trade and environmental terms alongside giant partners such as the United States and the European Union, while defending its role as a regional power. If the European Green Deal takes off as an international driver for deepening climate and sustainable development goals with European Union strategic partners, it remains to be seen how Mexico will respond to the challenge. In this paper we address the possible implications for Mexico under each of these instruments. We look at the interplay between them, explore the linkages and possible conflictual pathways, and “disentangle” the schemes in which trade and climate change are interconnected. Mexico may be trapped in a “catch-22” situation. Environmental provisions embedded in trade treaties provide critical benefits to the country, but this often comes at the expense of “unacceptable” environmental enforcement measures that can put at risk national development plans, especially at a time when the environment and climate change issues are not at the top of the current administration’s political agenda.
Topic:
Climate Change, Governance, European Union, Partnerships, Trade, and Green Deal
Political Geography:
North America, Mexico, and United States of America

79. The European Union Industrial Strategy: Reconciling Competition and Geoeconomic Challenges

Author:
Marie Krpata
Publication Date:
10-2022
Content Type:
Working Paper
Institution:
Institut français des relations internationales (IFRI)
Abstract:
The EU’s basic assumptions, on which it grounds its economic and trade power, are being steadily cast into doubt. The EU’s main trade partners, the US and China, increasingly set their sights on securing their supply chains, which may further a potential decoupling. This shift is likely to be accelerated in the context of growing geopolitical instability. Multilateralism and international trade principles are increasingly challenged by a weakening of international institutions and the recourse to asymmetric market practices, while technological leadership will be key in the struggle for global leadership. Being fundamentally built on economic openness, the EU is comparatively ill-equipped to respond to these developments. Its biggest economy, Germany, is prompted to assert itself if it does not want to lose in competitiveness. While the EU is developing strategies, policies, and instruments to adapt to this change of circumstances and increase its resilience, a shift in mentalities, leaving behind political and economic short-term interests, will be necessary.
Topic:
European Union, Trade Policy, Industry, Supply Chains, Geoeconomics, and Competition
Political Geography:
Europe and Germany

80. Hard Cash and Soft Power: When Chinese Firms Win EU Contracts

Author:
Allison Carragher
Publication Date:
11-2022
Content Type:
Working Paper
Institution:
Carnegie Endowment for International Peace
Abstract:
The European Union is a committed defender of open markets. This extends to its public procurement mechanisms, which remain open to all bidders. EU policymakers have developed tools intended to defend the bloc’s interests in the face of increased economic and strategic competition from the People’s Republic of China (PRC), but few policymakers understand how the European public views the debate. As the first major EU-funded, China-built infrastructure project, the Pelješac Bridge in Croatia provides a unique opportunity to conduct a thorough analysis of European public opinion toward EU tendering policy and Chinese companies. Brussels has labelled the PRC a partner for cooperation and negotiation, an economic competitor, and a systemic rival,1 but the nuances of this policy remain difficult to ascertain. Projects and policies presented by China as “cooperation” often contain elements of economic competition or are leveraged by the PRC for strategic gain. However, this dichotomy has not filtered down to citizens. Extensive polling reveals that Croatians share very few of the concerns of EU policymakers. Furthermore, the PRC state-owned construction firm enjoys more visibility than the EU, which provided hundreds of millions of euros for the project. In terms of soft power, which is here defined as the ability of a country to shape the narrative, the Pelješac Bridge has been a resounding success for the PRC. The Croatian public has largely embraced the PRC’s preferred image of itself as a reliable and trustworthy economic partner and a benign power that does not interfere in domestic affairs. This opinion diverges from official EU policy and glosses over evidence of the PRC’s unfair economic practices, environmental and labor shortcomings, and interference in European democracies. Notably, the PRC’s soft-power gains were achieved on the EU’s own dime. It is not in the EU’s interest to bankroll the economic and soft-power ambitions of its systemic rival. As a democratic institution, the EU has a responsibility to both respond to public opinion and educate its citizenry when EU interests are at stake. In this case, the EU should recalibrate its tendering policy to be fairer and better aligned with its own economic and strategic interests. This process is currently underway, but it should also be extended to co-financing arrangements like the Team Europe approach, which combines traditional EU assistance with support from individual EU member states and international financial institutions. These policies must also be paired with renewed efforts at visibility and branding. Lastly, there is a need to collect and publish better data on the end users of EU funds in order to evaluate successes and identify future issues.
Topic:
Infrastructure, European Union, Economy, Business, Soft Power, and Strategic Competition
Political Geography:
China and Asia

81. The EU Green Deal. A new momentum for democratic governance in the MENA region?

Author:
Dina Fakoussa
Publication Date:
01-2022
Content Type:
Working Paper
Institution:
IEMed/EuroMeSCo
Abstract:
Dysfunctional governance and repression lie at the heart of social, economic and political challenges and crises in the Middle East and North Africa (MENA) region. The nature of governance, whether autocratic, corrupt, crony capitalist, highly centralised, patriarchal and/or merely incompetent, led to alarming socioeconomic and political grievances. These grievances accumulated over decades sparking region- wide protests in 2010, 2011 and subsequent years. Without major improvements in the quality of democratic governance,1 further crises are inevitable, and sustainable stability will remain unattainable, with major negative repercussions for the European Union (EU) itself. Naturally, climate change is augmenting these challenges and increasing the pressure on government performance. The EU Green Deal addresses this uniquely urgent matter in need of assertiveness, namely climate change with its worldwide palpable repercussions and impact for all. The deal has serious implications for economies and hence societies in MENA countries. At the same time, it could and must serve as a vehicle for improved democratic governance in the region. This is also in the interests of the EU’s green ambitions, as lasting environmentally sound and socially just policies in countries beyond the EU will hardly materialise without improvements in the area of democratic governance. The two subject areas are mutually dependent; hence, the durable success of climate policies is unlikely without being buttressed by democratic components. This understanding needs to be mirrored in all EU policies and programmes targeting the region by interweaving climate policies with democratic governance.
Topic:
Climate Change, Governance, European Union, Democracy, Repression, and Green Transition
Political Geography:
Africa, Europe, Middle East, North Africa, and MENA

82. Developing EU Trade Incentives: A Support Tool for Refugee Self-Reliance and Host Community Resilience in Turkey

Author:
Basak Kale
Publication Date:
03-2022
Content Type:
Working Paper
Institution:
IEMed/EuroMeSCo
Abstract:
The European Union (EU) is developing innovative mechanisms to investigate the root causes of migration in order to offer better socioeconomic opportunities both to migrants and host communities. These mechanisms and actions require multi-country bilateral and regional assistance tools to support different partner countries. Innovative and out-of-the-box ideas include multiple countries and various stakeholders. They are developed to provide cooperation solutions in different regions to have a wider impact on the causes and implications of migration. Despite these efforts, political, social, economic and environmental causes continue to generate human mobility around and beyond the immediate neighbourhood of the EU. The Arab Spring and the civil war in Syria have been creating human mobility in the EU neighbourhood. The war made approximately 7 million Syrians flee to neighbouring countries. Turkey is hosting around 3.7 million Syrians and another half a million asylum seekers and refugees from other regions (DGMM, 2021; UNHCR, 2021). The presence of Syrians in Turkey, together with other refugees benefitting from international protection, has become protracted. The efforts to create durable solutions in the form of “voluntary return, resettlement or local integration” have not yet successfully provided sustainable solutions. Turkey does not pursue an official state integration policy to integrate asylum seekers, refugees and the Syrians under temporary protection (STP). However, STPs, asylum seekers and refugees are becoming increasingly integrated into their host communities through informal and local integration mechanisms (Kale & Erdoğan, 2019). The delay in the access to formal employment and challenges in receiving formal employment permits aggregate the difficulties in the inclusion of refugees into formal employment schemes. Summer 2015 has shown that when there is a lack of economic and employment opportunities for asylum seekers, refugees and persons under temporary protection the incentive to have onward movement to other countries persists and the possibilities of integration in host communities stay low. It is clear that resilience-building and livelihood support through formal work is essential for vulnerable populations to have dignified living conditions in host countries. The EU-Turkey Statement in 2016 triggered the development of changes in the legal framework of international protection and migration policy. The Statement paved the way for the preparation of regulations on work permits for persons under temporary and international protection (Official Gazette, 2016). Legal developments targeted the acceleration of the economic integration of refugees into the Turkish labour market through formal employment. However, the difficulties in getting formal work permits resulted in only 132,000 issued until 2019. This indicates that approximately 4% of the STP working population has formal employment (UN Turkey, 2020). This percentage more or less matches the International Labor Organization (ILO) estimations (ILO, 2020). As a result, the majority of the refugee population is working informally, underpaid (Balkan & Tümen, 2016), without formal social and health security mechanisms, in unskilled jobs that are not wanted by Turkish citizens (Sunata, 2017). Informal employment has been a key element contributing to the lack of durable solutions and a protracted process. In Turkey, informal employment is widespread even among the host community members. It is estimated that there is about 30% of labour in host community among all sectors working unregistered. Informal employment is higher in sectors such as agriculture but significantly lower in the industrial sector. The COVID- 19 pandemic has also aggravated the increasingly poor state of the Turkish economy (Akay Ertürk, 2020). Previously, there were continuous efforts through FRIT (Facility for Refugees in Turkey) and 3RP (Regional Refugee and Resilience Plan) projects with programmes focusing on improving the employability of refugees in the Turkish labour market as well as support for the entrepreneurship capacities of the refugees in accessing the formal labour market. However, under the current economic conditions these projects are failing to generate a significant long-term impact on employment for refugees (Özçürümez & İçduygu, 2020). These projects provide short-term trainings or restricted employment possibilities while including a very limited number of participants. In addition, the COVID-19 pandemic conditions have shown that these livelihood support arrangements when they are not based on rights-based approaches overtime can transform back into humanitarian aid services (Kale & Yavçan, 2020). Long-term policy planning needs to include other incentive mechanisms that will cover multi-country and multi-region solutions. In the long run, if vulnerable populations in the host societies turn into the most vulnerable requiring humanitarian and emergency aid, the incentive for secondary movements to third countries can be high.
Topic:
International Trade and Finance, Regional Cooperation, European Union, and International Community
Political Geography:
Europe and Turkey

83. Could the EU’s New Agenda for the Mediterranean Turn Climate Change from a “Threat Multiplier” into an “Opportunities Multiplier”?

Author:
Desirée A.L Quagliarotti
Publication Date:
03-2022
Content Type:
Working Paper
Institution:
IEMed/EuroMeSCo
Abstract:
The Mediterranean countries are char­acterised by evident gaps in terms of demographic growth, socioeconomic conditions and natural resources avail­ability, which undermine the process of Euro-Mediterranean cohesion and cre­ate a situation of structural weakness that makes them extremely vulnerable to destabilising events. In just over a dec­ade, the Mediterranean region has been affected by major changes that, at first glance, do not seem to be related to each other. The wave of pro-democracy pro­tests called the “Arab Spring” that has plagued the regimes of the Middle East and North Africa (MENA) since 2010 has shown how climate-driven crop failures in major food exporting countries may contribute to driving up international food prices and to amplifying social and polit­ical destabilisation, especially in food-im­port dependent countries (Werrell & Femia, 2013). The “Arab unhappiness” that spurred the popular uprisings has not faded over the years, giving rise to what has been referred to as the “Arab Spring 2.0”. This new round of turmoil, in which protesters demand a better quality of life, has been exacerbated by 2020s COVID-19 pandemic, clearly demon­strating, once again, the close inter­connection between human well-being and planetary health.[1] In the same time frame, in the Northern Mediterranean Countries (NMCs), the migrant-refugee crisis, characterised by new migration waves triggered by traditional as well as unconventional push factors linked to the effects of climate and environmental changes, is becoming one of the most important and divisive issues in recent European politics, adding a new layer of instability to the already shaky European Union (EU) (Pawel & Roland, 2018).
Topic:
Climate Change, Regional Cooperation, European Union, and Green Transition
Political Geography:
Europe and Mediterranean

84. From a Fragmented Cooperation to an Integrated Approach – The Emergence of the Maghreb and Sahel Region and its Consequences for the European Union

Author:
Erzsébet N. Rózsa and Viktor Marsai
Publication Date:
03-2022
Content Type:
Working Paper
Institution:
IEMed/EuroMeSCo
Abstract:
The history of the European Union (EU)’s foreign and security policy has been characterised by a continuous develop- ment and a process of adaptation to the realities on the ground and the experi- ences gained. This was manifest in the gradual change from bilateral relations to regional/multilateral structures, from trade through three-basket/three-pillar structured relations to the integrated ap- proach as introduced by the 2016 EU Global Strategy, and the institutionalisa- tion thereof. “Internal and external secu- rity are ever more intertwined: our secu- rity at home entails a parallel interest in peace in our neighbouring and surround- ing regions. It implies a broader interest in preventing conflict, promoting human security, addressing the root causes of instability and working towards a safer world” (EEAS, 2016). The present pa- per argues that, in order to be able to halt the increasingly complex threats fac- ing the EU and maintain its global actor status, the EU should introduce further – sectorial and regional – flexibility, in- cluding, among others, definitions of the widening geographical scope underlying its strategic vision. Therefore, this paper first asks how the EU and its member states should recon- sider their regional approach. How can the EU implement the existing frame- works and/or develop a more effective and adaptive strategy towards its south- ern neighbourhood fitting the new reali- ties on the ground better?
Topic:
Diplomacy, Regional Cooperation, and European Union
Political Geography:
Africa, Europe, and Sahel

85. The EU as a Soft Power Superpower: Why a Green Marshall Plan for the Sahel Is Imperative

Author:
Friso Stevens and Dortih Kool
Publication Date:
06-2022
Content Type:
Working Paper
Institution:
EGMONT - The Royal Institute for International Relations
Abstract:
This research paper argues that the European Union should roll out a European Green Marshall Plan for ecosystem restoration and local governance in the Sahel region, located between the Sahara to the north and the Sudanian savanna to the south. Ecological degradation and related climate change put mounting pressure on the region. In combination with cyclical resource-related conflicts and the presence of terrorist and insurgent groups, this has created an increasingly volatile situation. European security and stability are indirectly at stake. The EU’s ‘Old War’ footing and support for illegitimate, corrupt, and autocratic governments to ‘mow the lawn’ of terrorists and insurgents fails to address and often undermines fundamental human security needs in the region. The authors propose a remodelling of EU foreign and security policy to shift focus from current securitization efforts towards facilitating a green, bottom-up transition that empowers local communities’ ecological stewardship by using their existing knowledge, skills, and dynamics, and Farmer-Managed Natural Regeneration (FMNR). Failure to make these changes toward a human security-centred approach means the EU’s current security and climate-related policies risk further undermining rather than contributing to regional security.
Topic:
Security, Diplomacy, International Cooperation, and European Union
Political Geography:
Europe

86. The Digitalization of EU Public Diplomacy: the pandemic crisis and beyond

Author:
Christos A. Frangonikolopoulos and Eleftheria Spiliotakopoulou
Publication Date:
11-2022
Content Type:
Working Paper
Institution:
Hellenic Foundation for European and Foreign Policy (ELIAMEP)
Abstract:
This paper explores the digitalization of diplomacy and attempts to shed light on the adaptation level of the European Union by presenting the European External Action Service’s activity on social media and selected Public Diplomacy initiatives during the covid-19 pandemic. The main research questions posed in the study are: a) in what ways has the European Union used digital tools to respond to the coronavirus crisis; and b) what are the (recurring) challenges facing the European Union in its efforts to improve its image in a changing world and enhance its role as a leading global actor? The paper concludes that while the European Union is highly competent in terms of digitalization, it does face challenges, which are partly inherent in the sui generis nature of the European Union as an International Organization. These include the need for deeper integration, better coordination between member states, and further dialogue with the Union’s citizens, and must be met if the EU is to enhance trust and build solidarity, as well as a clearer and more solid European identity.
Topic:
Diplomacy, European Union, Regional Integration, COVID-19, Digitalization, and Adaptation
Political Geography:
Europe

87. The European Union’s uneasy journey through the energy crisis

Author:
Alekos Kritikos
Publication Date:
10-2022
Content Type:
Working Paper
Institution:
Hellenic Foundation for European and Foreign Policy (ELIAMEP)
Abstract:
The European Union revealed rapid reflexes when it came to imposing sanctions on Russia and supporting Ukraine, but has been extremely slow when it comes to taking measures to relieve its own citizens and businesses. At three fruitless summits in the first two months of the crisis, numerous member states’ repeated requests for a joint fiscal response mirroring that adopted vis-à-vis the pandemic were not even informally tabled. In May, the Commission presented the REPowerEU programme, which aims to transition to clean energy and end the EU’s dependence on Russian fossil fuels. The two European Councils in May and June agreed on new sanctions against Russia, further assistance for Ukraine, and joint EU supplies of defence equipment. However, no decision was made to impose a cap on the price of natural gas and the issue of a joint fiscal response to the crisis was not even discussed. Despite repeated requests, the Commission continued to not submit proposals to this effect. But pressure was mounting for decisions to be made. Fifteen countries signed a joint letter in September 2022 calling for a cap on gas prices. In a joint article, Commissioners Thierry Breton and Paolo Gentiloni have also called for a joint fiscal response. The two Councils of Energy ministers in September 2022 resolved on a series of measures, but these are national responses rather than a joint European initiative. The price cap was absent once again from the decisions made. The informal Prague summit did not reach any conclusions either, though it did table all the outstanding issues in question. Europe’s successes in dealing with the pandemic came with “collateral damages”, institutional and otherwise, and the bloc has continued to sustain further collateral damages during the current energy crisis.
Topic:
European Union, Crisis Management, Fossil Fuels, Energy Crisis, and Russia-Ukraine War
Political Geography:
Europe

88. Georgian-Greek Relations: Building a Strategic Dimension

Author:
Ioannis N. Grigoriadis and Mariam Gugulashvili
Publication Date:
10-2022
Content Type:
Working Paper
Institution:
Hellenic Foundation for European and Foreign Policy (ELIAMEP)
Abstract:
The cordial bilateral relations between Greece and Georgia are mostly centered on the culture and education domains, with less progress achieved in the areas of the economy, foreign policy, and security. Greece can emerge as Georgia’s key supporter in its EU membership aspirations, with Greek experts and diplomatic circles contributing their experience to the country’s EU integration process. This support can be realized at both high and low levels, through EU Twinning projects and results-oriented memoranda between state institutions to import best practices, so Georgia can successfully carry out the required democratization reforms and implement the EU Association Agreement effectively. As the international system becomes more multipolar and the strategic significance of the Black Sea and Caucasus regions increases, Greece and Georgia should work to deepen their ties and build interest-oriented synergies in order to forge a strategic alliance. The promotion of Western and European interests can be significantly aided by a democratic Georgia on the road to European integration and a resurgent Greece with a stronger regional presence in the Black Sea and Caucasus.
Topic:
Security, Foreign Policy, Bilateral Relations, European Union, and Economy
Political Geography:
Europe, Greece, and Georgia

89. EU-Georgia Relations at a Critical Juncture: A Case for European Strategic Autonomy

Author:
Ioannis N. Grigoriadis and Mariam Gugulashvili
Publication Date:
09-2022
Content Type:
Working Paper
Institution:
Hellenic Foundation for European and Foreign Policy (ELIAMEP)
Abstract:
Despite the substantial progress that Georgia has made in implementing the EU Association Agreement and related reforms, it has been experiencing democratic backsliding since 2018. The divergence of Georgia’s ruling party from a pro-European trajectory, as well as the political polarization that has been dominant in recent years, have contributed to the deterioration of ties between Georgia and the EU. Unlike Ukraine and Moldova, Georgia, which was once seen as a “reform pioneer,” was not given candidate status in June 2022. Georgian public opinion has always supported membership of Euro-Atlantic institutions, with more than 80% of Georgians today being Euro-enthusiasts and overwhelmingly in favour of joining the EU. The EU is Georgia’s largest donor and trading partner. Georgia’s key strategic option boils down to Russia vs. the West. Georgia should foster closer relations with certain EU member states that could provide key support for its EU membership aspirations.
Topic:
Bilateral Relations, European Union, Trade, and Strategic Autonomy
Political Geography:
Europe and Georgia

90. Threats, Instability and Disruption in Europe’s South

Author:
Marc Pierini
Publication Date:
07-2022
Content Type:
Working Paper
Institution:
Hellenic Foundation for European and Foreign Policy (ELIAMEP)
Abstract:
Russia’s intervention in Syria in September 2016 turned out to have much broader objectives. The development of air and naval bases provided Moscow with platforms for operations in the Mediterranean and in Sub-Saharan Africa. The delivery of S-400 missile systems to Turkey added another major strategic gain. The European Union is faced by broad challenges on its South, with a sharp decline in rule of law, political instability, and a surge in authoritarianism. Wider phenomena such as climate change, demographic trends, and criminal activities of human trafficking networks add to the challenges. ISIL is still a threat too. Turkey’s choice of disruptive policies has perplexed EU and NATO leaders in the recent past. Tensions with the EU have risen due to challenges to maritime boundaries and sovereignty of Cyprus and Greece. Although largely a consequence of Russia’s invasion of Ukraine, the European Union’s major foreign policy initiatives in 2022 have marked a watershed moment and constitute a useful precedent for the Union’s policies with third countries. In the near future, the EU will have to invent a new format, distinct from accession, for its relationship with the countries of ‘Wider Europe’ and to use its now diversified ‘foreign policy toolbox’ in a coherent and effective fashion.
Topic:
Foreign Policy, NATO, Diplomacy, Sovereignty, European Union, and Instability
Political Geography:
Europe, Turkey, and Southern Europe

91. The Second Phase of the EU Southern Gas Corridor: Which role for Azerbaijan?

Author:
Marika Karagianni
Publication Date:
04-2022
Content Type:
Working Paper
Institution:
Hellenic Foundation for European and Foreign Policy (ELIAMEP)
Abstract:
The operation of the Southern Gas Corridor marks the first attempt of the EU to diversify its pipeline gas supplies and routes beyond Russia. The 2nd Phase of the Corridor, which involves the operation of several gas interconnectors in South Eastern Europe, is being promoted, while the EU is looking for additional supply sources, namely LNG. The Russian invasion of Ukraine, coupled with the intense energy crisis in Europe, has reinforced these trends. Field development in Azerbaijan and future prospects for LNG exports, primarily from the US, are discussed in this article as realistic options for alternative supply sources for Europe.
Topic:
Development, European Union, Gas, Exports, and Pipeline
Political Geography:
Europe, Central Asia, and Azerbaijan

92. Europe after Putin’s War: EU Foreign and Defence Policy in the new European security architecture

Author:
George Pagoulatos and Spyros Blavoukos
Publication Date:
03-2022
Content Type:
Working Paper
Institution:
Hellenic Foundation for European and Foreign Policy (ELIAMEP)
Abstract:
Russia’s invasion of Ukraine is a game changer for Europe and the global system and a call for the EU to emerge as a coherent security actor. Any EU discussion about an autonomous EU military capacity becomes irrelevant in the face of a systemic global security challenge, such as Russia, which cannot be dealt with through the existing or envisaged EU military instruments. Faced with a security challenge on a global scale, NATO remains the only game in town. The EU ambition of developing its strategic autonomy becomes practically meaningful only within the transatlantic alliance. EU member-states should take advantage of the existing clauses that enable significant steps to be taken towards foreign and security integration. The existing Treaty framework provides legal space for significant advances in the field of foreign and security integration, even though all relevant Treaty Articles contain strong ‘brakes’ which enable member-states to retain control of the process. Enhanced cooperation in EU foreign and security policy remains an important way forward, even though there are significant safety clauses. The ‘mutual defence’ or ‘mutual assistance’ clause (Article 42(7) of TEU) and the ‘solidarity clause’ (Article 222 of TFEU) are the closest things the EU has to security guarantees. Adding teeth to 42(7) should be an EU priority. Supporting EU ‘coalitions of the willing’ (Article 44 of TEU) also provides the opportunity for swifter military action under the EU aegis. The modality of cooperation between such coalitions and the EU rapid deployment capacity, which is also envisaged in the Strategic Compass and the Permanent Structured Cooperation (PESCO), has still to be worked out. Transition to qualified majority voting (QMV) in EU foreign policy decision-making presents both advantages and disadvantages, both from the standpoint of the EU and of the dissenting member states. The EU cannot become a credible global power if it cannot reach collective decisions on EU foreign and security policy. Moving towards QMV would address structural weaknesses and serve the objective of European sovereignty. However, smaller member-states need a strong and explicit reassurance that they can always use the existing emergency brakes when they consider an issue which is to be decided on by QMV to be a matter of national security. Transition to QMV should be the result of the gradual forging of a common foreign policy understanding on the major security challenges facing the EU. Human rights issues and sanctions are a good place to start when building momentum towards QMV. In the meanwhile, the current reform effort should be focused on investing in the institutional framework of EU foreign and security policy and making good use of existing instruments.
Topic:
Security, Foreign Policy, Defense Policy, European Union, Vladimir Putin, and Russia-Ukraine War
Political Geography:
Europe

93. EU-Africa relations ahead of the EU-AU Summit: Taking stock, looking forward

Author:
Pavlos Petidis
Publication Date:
02-2022
Content Type:
Working Paper
Institution:
Hellenic Foundation for European and Foreign Policy (ELIAMEP)
Abstract:
The European Union’s (EU) development policy is a broad field of activity that has undergone multiple significant modifications in both its definitions and its goals. The external relations of the European Union have long included development policy, resulting in an asymmetrical relationship with Africa. Since the turn of the century, the scope of the EU-Africa relationship has expanded to cover new challenges including climate change, terrorism, trade liberalization, and migration. EU development policies reveal a long-term shift in EU development priorities away from fundamental development goals and toward a wider array of ambitions, actors, and methodologies. Identifying and prioritizing the International Organizations on which it and its member states should best focus their diplomatic and political capital is a challenge. Given the political clout and relevance of the African Continental Free Trade Area (AfCFTA) for the continent’s economic development, the EU can concentrate its efforts on encouraging its implementation by deepening its Economic Partnership Agreements (EPAs). Working together to strengthen multilateralism and support the implementation of the European Green Deal and the AfCFTA form the axis of a new articulated African agency.
Topic:
Climate Change, Development, Diplomacy, Migration, Terrorism, European Union, Partnerships, and African Union
Political Geography:
Africa and Europe

94. Who are the populists and how to respond to them: Evidence from mainstream European Parliament parties

Author:
Dimitri A. Sotiropoulos
Publication Date:
01-2022
Content Type:
Working Paper
Institution:
Hellenic Foundation for European and Foreign Policy (ELIAMEP)
Abstract:
The main research questions of this paper are how mainstream European Parliament parties conceptualize populism, and how they respond to the rise of populism. The paper, which has come out of the Horizon 2020 project “Demos”, is based on semi-structured interviews with top officials of non-populist parties in the European Parliament (“Europarties”), such as the ALDE, EPP, the Party of European Socialists and the European Greens. The research technique of the paper is thematic analysis, performed on the responses obtained from the aforementioned interviews. Europarty officials identified populist parties by associating them with core themes such as anti-migration, Euroscepticism, and the tendency to make undeliverable policy promises. As for the effectiveness of anti-populist strategies, the interviewees converged on the idea that the problems posed by populists cannot be ignored and that clear and concrete policy solutions are what mainstream parties need, if they are to defend themselves against the evasive political discourse of populist parties. Non-populist parties in the European Parliament may use three strategies to prevent the rise of populists, namely clashing with, marginalizing, or co-opting the populists. Non-populist parties may prefer to incorporate selected questions raised by the populists into their political agendas, and provide non-populist replies to them. Mainstream parties seem aware that while populists may not win arguments over concrete policy measures, they might win voters’ hearts.
Topic:
Politics, European Union, Populism, Domestic Politics, and European Parliament
Political Geography:
Europe

95. Turkey’s “anti-colonial” pivot to Mali: French-Turkish competition and the role of the European Union in the Sahel

Author:
Ioannis N. Grigoriadis and Dawid A. Fusiek
Publication Date:
01-2022
Content Type:
Working Paper
Institution:
Hellenic Foundation for European and Foreign Policy (ELIAMEP)
Abstract:
Turkey’s rising foreign policy ambitions have been best reflected in its pivot to Africa. One of the tropes used by the Erdoğan administration to advance its cause are references to the colonial heritage of the European Union (EU) and its member states. The AKP and its officials have employed this discourse to challenge the French influence in Mali since the 2020 coup d’état. As this paper shows, Turkey uses anti-colonial discourse to exploit postcolonial sentiments with a view to challenging the political and economic power of Western actors, to portraying Turkey as a legitimate and “anti-colonial” ally and partner and, in the long run, to establishing a robust Turkish presence in Mali, the Sahel and beyond. In order to counter Turkish influence, the EU needs to promote fair cooperation with Mali and West Africa, to assist with political and economic development in the region, and to mobilise Member States which are unencumbered with a colonial past.
Topic:
Foreign Policy, European Union, Anti-Colonialism, and Competition
Political Geography:
Africa, Europe, Turkey, Middle East, France, Mali, and Sahel

96. Rethinking EU economic governance: The foundation for an inclusive, green and digital transition

Author:
Francesco De Angelis, Laura Rayner, and Frederico Mollet
Publication Date:
02-2022
Content Type:
Working Paper
Institution:
European Policy Centre (EPC)
Abstract:
The European Union is undertaking a comprehensive review of its economic governance framework, to address longstanding criticisms, respond to the impact of COVID-19, and prepare for the challenges posed by the twin green and digital transitions. This Discussion Paper represents the final instalment of an EPC Task Force series that examined the current approach and proposes 10 concrete policy recommendations to make EU economic governance stronger, greener and fairer: Establish a central investment capacity for green and digital investments (including associated social investments) or, alternatively, a golden rule modelled on the governance of the Recovery and Resilience Facility. Introduce a single net expenditure rule with a country-specific debt target based on nationally designed expenditure and debt plans to enhance political ownership. Shift to a multiannual supervision and assessment framework and introduce fixed medium-term budgetary plans, with a control account tracking deviations. Reform the sanctions regime to increase proportionality, perceived fairness and political enforceability. Differentiate country-specific supervision based on a clear risk threshold. Introduce ‘National Reform and Investment Plans’ modelled on the National Recovery and Resilience Plans, using a commitments-based approach to operationalise social, fiscal, macroeconomic and structural country-specific recommendations. The plans’ components with strong links to fiscal sustainability should govern the use of Stability and Growth Pact (SGP) flexibilities. Reform the Stability and Convergence Programmes (SCPs) to focus more on the investment composition of national fiscal plans and their link to broader policy objectives. Introduce an opinion on the individual and joint impact of the SCPs on imbalances into the Macroeconomic Imbalances Procedure to strengthen its link with the SGP. Introduce new processes into the European Semester to assess non-macroeconomic structural risks, such as climate and environmental risks. Build on the success of the temporary Support to mitigate Unemployment Risks in an Emergency (SURE) programme to create insurance-based mechanisms to support national fiscal policy during downturns.
Topic:
Economics, Governance, European Union, and Digital Transition
Political Geography:
Europe

97. The EU–Ukraine Association Agreement after Ukraine’s EU membership application: Still fit for purpose

Author:
Guillaume Van der Loo and Peter Van Elsuwege
Publication Date:
03-2022
Content Type:
Working Paper
Institution:
European Policy Centre (EPC)
Abstract:
In an extraordinary session of the European Parliament on 1 March 2022, Ukrainian President Volodymyr Zelensky requested from a bunker in Kyiv, while Russian missiles bombarded Ukraine, the EU to give the war-ravaged country a clear path towards EU membership. The day before, Ukraine had submitted its official application to the EU, followed shortly by Georgia and Moldova. The European Parliament already supported Ukraine’s membership application and called on the EU institutions to work towards granting Ukraine EU candidate status, in line with Article 49 TEU. Offering such a status would be a historic token of support for Ukraine in its self-defence against Russian military aggression. The Versailles declaration, adopted by the heads of state or government of the EU member states on 10 and 11 March, acknowledges that Ukraine belongs to the ‘European family’ without explicitly mentioning the country’s candidate status. Nevertheless, the Council already invited the European Commission to submit its opinion in accordance with Article 49 TEU. Despite this support for – and recognition of – Ukraine’s application, the road to EU membership remains a long one. Several member states have concerns about Ukraine’s readiness and eligibility for the pre-accession process, the EU’s absorption capacity, and the geopolitical consequences of the Union’s further eastward enlargement. Moreover, the economic consequences of the war will also complicate Ukraine’s concrete progress in its accession process. With Russian tanks and missiles still on Ukrainian soil, discussing actual membership is arguably premature. This may create unrealistic expectations and lead to frustrations in the applicant countries. It will therefore be important to remain clear and transparent about the EU accession procedure and offer concrete and credible incentives for reform and gradual integration in the Union throughout the long and winding pre-accession procedure. Paired with an unprecedented assistance package and new forms of sectoral integration in key EU policies (e.g. the twin green and digital transitions), the current EU–Ukraine Association Agreement remains the most appropriate instrument to develop this bilateral relationship further. The dynamic nature of the agreement, combined with its open-ended accession perspective, implies that both the EU and Ukraine can reorient it to new and more ambitious forms of political association and economic integration and accommodate it to a pre-accession context on the basis of a staged approach.
Topic:
Treaties and Agreements, European Union, and Regional Integration
Political Geography:
Europe and Ukraine

98. War has returned to Europe: Three reasons why the EU did not see it coming

Author:
Corina Stratulat
Publication Date:
04-2022
Content Type:
Working Paper
Institution:
European Policy Centre (EPC)
Abstract:
Before 24 February, Europe decidedly defined itself as 'post-war'. But since Putin's full-scale, cold-blooded invasion of Ukraine, war again defines the Union's reality. Damage control is the main priority now — but knee-jerk reactions and moral outrage do not amount to a strategy, argues Corina Stratulat. To create a future that stops perpetuating the past, the Union and its member states must also start to critically contemplate how they got into the current predicament and change course. Three lessons stand out: First, since the fall of the Berlin Wall in 1989, overconfidence in its own allure and model has skewed the EU's perspective of itself and the rest of the world. While freedom, pluralism and liberal democracy remain attractive, liberal expectations that the Union would be able to convert even its immediate neighbourhood – let alone the world – to its image have proven illusory. Despite almost two decades of European integration, democratic performance has still not acquired a positive dynamic in the Balkans. And yet the membership card has now been confidently and imprudently put on the table for Ukraine and other eastern countries, posing as a solution to the current crisis. Without practising humility, the EU stands to persevere in its confirmation biases and continue to evade learning. Second, the EU's unrealistic aspirations to global hegemony have long been concealing a policy of double standards both at 'home' and abroad, piling up accusations of hypocrisy. While the EU was pretending to be a shining example of liberal democracy, several member states have taken full pages from Putin's autocratic playbook or put their own interests ahead of the Union's 'sacred' democratic values — faults easily exploited by illiberal actors, like Putin. Dressing up the EU's foreign policy ambitions as efforts to revive global democracy will remain a hypocrisy trap, including in Ukraine now. Third, a misplaced acceptance of the status quo has prevented the EU from getting to the bottom of the many crises it has been grappling with for decades. But the Union cannot wish away systemic risks or escape the fact that dealing with today's enormous challenges will require deep and brave reforms across the board. The stresses of cumulative crises, crowned now by the ongoing war, give the Union a chance to plan the future. The choices that the EU will make in the coming years will determine what the Union truly values and whether it will be able to preserve its own way of life. If the EU is keen to maintain the normative power of its liberal values in an increasingly illiberal environment, it should obsessively focus on making liberalism its sign of distinction from the outside world, not a model to transform others. The Union has to learn to live by example and will have to work hard to become exemplary.
Topic:
European Union, Norms, Russia-Ukraine War, and Illiberalism
Political Geography:
Russia, Europe, and Ukraine

99. After Russia’s invasion of Ukraine: Unity is good, but ambition is better

Author:
Sophie Pornschlegel and Ilke Toygür
Publication Date:
06-2022
Content Type:
Working Paper
Institution:
European Policy Centre (EPC)
Abstract:
In view of the volatile geopolitical environment, EU leaders no longer have the luxury of waiting for all 27 member states to find a consensus. In order to lead the way to a Union that is apt for future challenges, the EU should become more ambitious and embrace alternatives, such as differentiated integration, in the coming months and years. Rather than returning to the status quo ante, the EU should use this momentum to progress in five policy fields: economic governance, with a new recovery package and a reform of the fiscal rules; security and defence, with improved EU–NATO cooperation and a stronger ‘European pillar’; energy policy, by quickly steering member states away from dependence on Russian fossil fuels while simultaneously ensuring admissible energy prices for consumers and respecting the climate targets; enlargement and neighbourhood policy, by rethinking its aims and creating options for countries that are unlikely to become EU members in the foreseeable future; and the rule of law, to safeguard the Union’s values ‘at home’. Both the COVID-19 pandemic and the Russian invasion revealed that the EU institutions and leaders are capable of managing crises swiftly and decisively. This reality certainly increases its legitimacy in the eyes of its citizens as well as its allies. The European Union could use this moment of change to increase its ambition for reforms and for moving European integration forward. This should encourage leaders to think about all the options for designing the Union’s future. This is not a time for black and white thinking – Treaty change or nothing –, but rather a time to explore all the shades of grey for securing necessary reforms. If like-minded countries could lead the way, others may also follow. The changing and evolving positions in the EU could help secure more inclusive alliances for moving forward. The political momentum to do so is finally here.
Topic:
Security, Energy Policy, European Union, Geopolitics, Economy, Rule of Law, Regional Politics, and Russia-Ukraine War
Political Geography:
Russia, Europe, and Ukraine

100. The von der Leyen European Commission at midterm: Same priorities, different reality

Author:
Corina Stratulat, Annika Hedberg, Stefan Sipka, Janis Emmanouilidis, and Johannas Greubel
Publication Date:
06-2022
Content Type:
Working Paper
Institution:
European Policy Centre (EPC)
Abstract:
At the halfway point of the von der Leyen Commission’s term, and amid a tumultuous context, the EPC has conducted a thorough and broad analysis of its successes and failures so far. How have the pandemic and the war affected President von der Leyen’s initial promises? What are the key imperatives ahead? How can von der Leyen make the most of the remainder of her mandate to help the EU advance in this new era (Zeitenwende)? EPC analysts from across all programmes compare and contrast the initial 6 policy priorities against their actual delivery and provide recommendations for the second half of the Commission’s term.
Topic:
Foreign Policy, Migration, European Union, Democracy, Digital Policy, Green Deal, and European Commission
Political Geography:
Europe