Revving a two-speed Europe

In January, José Zapatero's call on behalf of the EU's rotating presidency for increased economic cooperation within the Union and sanctions against over-indebted countries was greeted with mockery, but shortly afterwards when the virus of contagion began to threaten the eurozone, coordination became the new idea in vogue in Brussels. Today, many European diplomats assert that "crisis is a excellent catalyst for reform," and there is certainly some truth to this argument. The only problem is that reforms may split the membership of the EU into groups defined by different levels of integration. Poland and other 'new' member states of the Union will have to fight to avoid being consigned to a future second division.

The drive for change prompted by the Greek crisis has been increasingly marked by decisions taken by Germany and France which effectively sideline the European Commission. At the same time, 'core' European states largely bypassed Brussels when they took the initiative to create the Luxembourg-based European Financial Stability Facility (EFSF) — a fund to provide financial assistance to eurozone countries in difficulty.

Eurozone-European 27 fracture?

As French Secretary of State for European Affairs, Pierre Lellouche recently remarked, the agreement to launch this fund amounts to a de facto amendment of EU treaties. And it is just one of a number of measures that have been proposed to further integrate the eurozone. Notwithstanding a certain reticence on the part of Berlin, the French government is lobbying for the creation of permanent council of eurogroup countries to coordinate economic policy and monitor budgetary discipline. Germany wants tough punishments for countries with poor public finances, and these include withdrawal of access to EU funds, including structural funds. Although Chancellor Angela Merkel insists that the reforms will concern all of the EU's 27 member states, a system with severe sanctions will not find much support in London, which has always been quick to oppose any initiatives that it believes will compromise its sovereignty or its rights within the Union. All the indications are that if economic coordination for Europe's 27 member states proves to be impossible, it will be limited to the eurozone. As a senior EU diplomat has pointed out, it is highly unlikely that Germany will abandon its drive to stabilise the euro.

Angela Merkel and Nicolas Sarkozy have expressed divergent views on the nature of the reforms to be implemented, but that does not mean they are unlikely to defer the matter to the European Commission, which in the wake of criticism for its failure to examine financial statistics presented by the previous Greek government and its slow-paced response to the economic crisis, is increasingly viewed with mistrust by the French and Germans, as well as the Dutch. In fairness, it should be said that the Commission is in fact a longstanding advocate of member states' national budgets evaluation — an idea that was initially accepted by European finance ministers, but only on the basis that the Commission would be excluded from such a process. As Austrian political analyst Paul Luif has remarked, the crisis of confidence threatening the European Union is both internal and external.

"Grey mouse's" increasing authority

Erosion of the role played by the Commission and other EU institutions will necessarily undermine procedures designed to ensure the participation of all member states in the EU's decision making process — and this was evident in the debate on the euro bailout, which was largely determined, not by votes in the European Parliament or the European Council, but by the opinions of the major financial contributors to the Union and their diagnosis of the crisis. In this generally negative context, the one positive sign has been the growing influence of the EU presidency. "Following my election to the presidency of the European Council, I was referred to as a Belgian grey mouse. Today, I hear that I'm extending my authority. That's a lot of progress in just five months," ironically remarked Herman Van Rompuy, who has increasingly assumed ascendancy over José Manuel Barroso — a transition recognised by member states which opted to entrust work on reforms to combat the economic crisis to the Belgian rather than to his Portuguese colleague.

Increased economic cooperation, bailout packages and even the application of sanctions within the eurozone will inevitably contribute to the progressive division of the EU into a two-speed Europe, in which Poland and countries that have yet to join the eurozone will not be as integrated or as influential as 'core Europe' member states. Both Poland and Sweden have voiced their concern over this scenario, but it is not certain whether this trend can now be halted. Can we really expect to put the brakes on the integration of a 'core Europe' with a view to safeguarding Poland's inclusion in the eurozone?

No one is happy with the anachronistic concept of a multi-speed Europe, and no one is actively seeking to create a 'core Europe' — although such an entity may emerge as a result of the initiative to avert the economic crisis. At the end of the day, it is not surprising that the large countries in the European Union choose to apply their own ideas which they believe to be better, instead of entrusting control to officials in Brussels. And on occasion, as one Polish diplomat remarked, they also prefer to discuss these initiatives away from Brussels. Instead of attempting to block increased economic coordination, Warsaw should follow the direction given by the Union's major economies and take advantage of the the first available opportunity to climb on board the European high-speed train.