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342. NATO and the European Union: Bridging the gap
- Author:
- Andrew Duff
- Publication Date:
- 05-2024
- Content Type:
- Working Paper
- Institution:
- European Policy Centre (EPC)
- Abstract:
- In this Discussion Paper, Andrew Duff examines how Russia’s invasion of Ukraine has exposed structural flaws in how the West organises its European defence and how the European Union and NATO have struggled to coordinate, risking duplication and competition. Despite largely overlapping membership, neither organisation has been able to realise conventional solid defence forces. Europe’s armaments industries remain largely fragmented. Ukraine’s application to join the EU and NATO upturns the status quo. The author analyses how the Union's political and financial heft can best be combined with the Atlantic Alliance's military strength and recommends forging a permanent organic link between the two at the executive level. However, a joint command will enhance the EU’s development in security and defence, revitalise NATO, and ensure that the US and UK remain engaged in Europe.
- Topic:
- Defense Policy, NATO, European Union, and Regional Integration
- Political Geography:
- Europe
343. Russia’s war against Ukraine: Lessons on infrastructure security and new technologies
- Author:
- Auriane Técourt and Maria Martisiute
- Publication Date:
- 07-2024
- Content Type:
- Policy Brief
- Institution:
- European Policy Centre (EPC)
- Abstract:
- In 2022, Russia hit Ukraine with a major cyberattack and unleashed a full-scale war of aggression. This includes new technologies and AI-enabled capabilities such as the Bylina electronic warfare command-and-control system. Nord Stream and the Balticconnector also fell victim to sabotage attacks by hostile actors. In this Policy Brief, it is highlighted that the EU has stepped up its resilience and cybersecurity of critical infrastructure. However, the capacity to leverage innovative technologies and defensive AI remains underdeveloped. Furthermore, the protection of industrial control systems (ICS) remains unaddressed. As Russia upgrades its 2030 National AI Development Strategy, there is an urgency to integrate the security of industrial controls into the EU’s approach to the cybersecurity of critical infrastructure before Moscow strikes with deadlier offensives. It is also time to start building a measured, albeit scalable, deployment plan for new technologies that may be AI-enabled for European critical infrastructure in connectivity with Ukraine and Moldova. The Paper explains that the EU has strengthened cybersecurity and resilience of critical infrastructure, but there is still room for improvement. Considering the pace at which new technologies and AI-enabled technologies are developing, the following steps would enhance the security of European infrastructure: Possible attack scenarios. Mandatory SOCs and cyber hubs. Industrial control systems (ICS). Synergies between the EU and NATO. A deployment plan for new technologies that may include AI.
- Topic:
- Infrastructure, European Union, Cybersecurity, Artificial Intelligence, and Russia-Ukraine War
- Political Geography:
- Russia, Europe, and Ukraine
344. Next Commissioner for Enlargement: Which criteria should inform the selection?
- Author:
- Berta López Domènech
- Publication Date:
- 08-2024
- Content Type:
- Policy Brief
- Institution:
- European Policy Centre (EPC)
- Abstract:
- With war raging on European soil, the European Union (EU) needs competent leadership – ready and willing to tackle head-on the polycrisis and polytransition confronting the Union and its member states. Enlargement will be one of the most politically heavy dossiers in the upcoming politico-institutional cycle. Therefore, the choice of the European Commissioner in charge of this dossier is of utmost importance. This Policy Brief examines what the candidate needs to possess for the role: Commitment to EU democratic values. Support for enlargement. Capacity to forge consensus among member states and candidates. Trustworthiness in the eyes of all relevant stakeholders. The Paper argues that without this combination of credentials, it is difficult to imagine how the next Commissioner for Enlargement will translate into practice the member states’ current discourse about the geopolitical imperative of delivering a wider and more secure Union of 30+ countries.
- Topic:
- European Union, Regional Integration, and Enlargement
- Political Geography:
- Europe
345. Keeping the Promise: Reform of governance in the enlarged European Union
- Author:
- Andrew Duff
- Publication Date:
- 09-2024
- Content Type:
- Working Paper
- Institution:
- European Policy Centre (EPC)
- Abstract:
- Provoked by Putin, the EU is having to rapidly revise its strategy for the future of Europe. Enlargement, long dormant, is now a top geopolitical priority. Defence has become a principal driver of European integration. This Discussion Paper examines how the two themes of widening and deepening the Union are interconnected. Ursula von der Leyen’s second Commission is preparing pre-enlargement reforms of EU common policies and decision-making processes. Despite disagreements among member states and nationalist political parties, the presumption of enlargement and the necessity of self-defence leaves the EU little choice but to continue on its federative path. No institution will escape the imperative of reform. Negotiations to expand the size and compass of the EU budget will be particularly difficult. Treaty change is inevitable — and should be well prepared by an expert reflection group. Faced with accelerating European unity, the UK will, sooner than expected, have to confront the issue of EU membership.
- Topic:
- Governance, Reform, European Union, Geopolitics, and Enlargement
- Political Geography:
- Europe
346. Security and Eastern Enlargement: Bridging the Gap for Wartime EU Accession
- Author:
- Monika Sus and Michał Matlak
- Publication Date:
- 10-2024
- Content Type:
- Policy Brief
- Institution:
- European Policy Centre (EPC)
- Abstract:
- Given the unprecedented situation of wartime accession and the significant security implications of Ukraine’s EU membership for the Union and its Eastern neighbourhood, the EU should consider aligning the enlargement process with its broader security policy toward the candidate country. Failure to do so risks stalling the enlargement agenda due to unresolved security challenges. While some experts argue that linking security and enlargement policies could further complicate an already complex negotiation process, the opposite needs to be discussed. This Policy Brief proposes three institutional ideas that would facilitate integrating security concerns into the enlargement process without risking prolonging it. This includes examining the enlargement methodology, better collaboration between relevant Directorates-General (DGs), commissioners responsible for security, defence and enlargement, and the European External Action Service, as well as advancing the debate about the operationalisation of Art 42.7 to provide Ukraine with security guarantees in coordination with NATO.
- Topic:
- Security, European Union, Russia-Ukraine War, and Enlargement
- Political Geography:
- Europe and Ukraine
347. On the Importance of Placebo and Nocebo Effects in International Trade
- Author:
- Lucian Cernat
- Publication Date:
- 06-2024
- Content Type:
- Policy Brief
- Institution:
- European Centre for International Political Economy (ECIPE)
- Abstract:
- Trade agreements are powerful drivers of global economic integration, leading to increased trade flows between countries. Usually, trade agreements are extensive documents with hundreds of provisions and different levels of enforceability. Are all these provisions useful, even those that are “best endeavours” and do not introduce legally binding obligations on trading partners? This policy brief proposes a new methodological approach to evaluate these effects. The basic idea is inspired by the “placebo effect” in medicine: under the right conditions, one can get positive results, even when the actual intervention is simply a “sugar pill”. Similarly, trade policies may have positive effects even when they lack strong, enforceable commitments. A placebo trade policy effect can emerge from “soft provisions” that bring positive trade effects, compared to the “do nothing” scenario. The main hypothesis behind this new methodology is that even if trade interventions lack the force to solve problems outright, a positive placebo effect can arise if stakeholders believe that such a policy will generate favourable market access. Conversely, a negative nocebo effect might emerge when stakeholders are convinced that certain trade policy initiatives (notably FTAs) have a detrimental impact, despite undeniable evidence to the contrary. The paper concludes with a few concrete examples illustrating both the placebo and nocebo effects and identifies factors that may lead to more positive outcomes from current and future trade policies.
- Topic:
- Globalization, Treaties and Agreements, European Union, Trade, and WTO
- Political Geography:
- Europe
348. A Strategy for a Competitive Europe: Boosting R&D, Unleashing Investment, and Reducing Regulatory Burdens
- Author:
- Andrea Dugo and Fredrik Erixon
- Publication Date:
- 07-2024
- Content Type:
- Policy Brief
- Institution:
- European Centre for International Political Economy (ECIPE)
- Abstract:
- The EU stands at a crucial economic juncture. Economic growth in Europe’s mature economies has stagnated, with productivity and other indicators of economic vitality showing poor results. Public debt is alarmingly high in several countries, and the region faces new fiscal demands due to an ageing population, conflicts and war, and the energy transition. To reverse its economic decline, Europe must adopt a new strategy for improved competitiveness. The starting point of this strategy should be an honest assessment of Europe’s declining productivity compared to leading economies like the US. Historically, some European countries matched or even surpassed US productivity levels, but this gap has widened over the past three decades. While the US economy has also faced challenges, its technology, R&D, and innovation sectors have significantly boosted productivity growth. This paper identifies three key areas for policy improvement to rejuvenate Europe’s economic dynamism: Radical expansion of R&D Expenditure: Governments must significantly increase funding for universities and create better conditions for private R&D investments. The EU currently fails to meet its own target of R&D expenditures at 3 per cent of GDP. Achieving parity with US R&D expenditure levels would require an additional €200 billion annually. Mobilisation of European Savings for Investment: Despite a higher savings rate than the US, Europe’s underdeveloped capital markets hinder economic growth and investment in new enterprises. The EU needs policies to channel savings into a vibrant corporate market. Expanding the European bond market, which is currently half the size of the US one, is essential for European firms to secure funding and keep the pace of American innovation. Regulatory Reform: The EU’s restrictive regulatory environment increases business costs and stifles innovation. A shift in regulatory attitudes, for instance in the banking sector, could unlock €4.5 trillion annually, providing much-needed capital for European firms, especially small and medium-sized enterprises, to finance innovation during the green and digital transition. By addressing these areas, Europe can create a more favourable environment for business growth, innovation, and long-term economic stability.
- Topic:
- European Union, Regulation, Digital Economy, Investment, and Research and Development
- Political Geography:
- Europe
349. The External Side of Europe’s Great Economic Transformation: International Trade in Services
- Author:
- Lucian Cernat and Carmen Díaz Mora
- Publication Date:
- 07-2024
- Content Type:
- Policy Brief
- Institution:
- European Centre for International Political Economy (ECIPE)
- Abstract:
- Europe’s digital transition is starting to bear fruits. Europe’s economic landscape is becoming increasingly digital, with sectors like information and communication technology (ICT) capturing a growing share of EU GDP. This Policy Brief examines the impact of these economic shifts on Europe’s trade profile and the policies that the EU can pursue to support this transformation.
- Topic:
- International Trade and Finance, European Union, Regional Economy, and Digital Transition
- Political Geography:
- Europe
350. Future-proofing the EU’s Investment Attractiveness: A Bold Reform Agenda for Competition Enforcement, Taxation and Digital Policy
- Author:
- Matthias Bauer, Dyuti Pandya, and Oscar du Roy
- Publication Date:
- 07-2024
- Content Type:
- Working Paper
- Institution:
- European Centre for International Political Economy (ECIPE)
- Abstract:
- Reducing the deterrent effects from EU and Member State laws in three key cross-sector policy areas – competition policy, business taxes and VAT, and digital policies – could significantly enhance the business environment within the Single Market and boost the EU’s attractiveness to both domestic and foreign investors. The EU’s future competitiveness is at risk due to a significant disparity in investments, particularly in technological innovation, compared to the US. Despite having a larger population and labour force, the EU lags behind in large business activities, with US firms consistently outspending their European counterparts in key tech-intensive sectors such as software, computer services, pharmaceuticals, and biotechnology. Moreover, China and other emerging nations are rapidly catching up, dramatically diminishing the EU’s relative economic and political influence on the global stage. The urgency for the EU to bridge these gaps is more critical than ever (Section 2). The EU’s profound investment gap highlights a systemic advantage for the US in fostering innovation and economic growth. The EU’s regulatory complexity, largely driven by legal fragmentation in horizontal policies, further exacerbate the situation, deterring cross-border activities reducing the region’s attractiveness to global investors (Section 3).
- Topic:
- Markets, Reform, European Union, Digital Economy, Investment, and Digital Policy
- Political Geography:
- Europe