6/29/15 6/29/15

2015 at dawn.com)

Europe has been slow in its response to China’s ‘One Belt, One Road’ initiative. This may be about to change. If both sides play their cards right, the EU-China Summit on June 29 could kick-start a much-needed conversation on synergies between China’s ambitious vision of an interconnected world and Europe’s mega investment plan to boost jobs and growth.The rewards of such cooperation could be enormous. Increased EU-China connectivity will increase bilateral trade between the two partners, create new business opportunities for European and Chinese enterprises, and boost employment, growth and development in Europe and China — and in countries along the routes.To start the dialogue, Europeans will have to take the long view. With the possibility of a Greek exit from the Eurozone getting ever closer, Britain’s plans for a referendum on its EU membership becoming more strident and growing discord over how to deal with the refugee crisis, European policymakers are thinking local, not global.It’s not just about domestic difficulties; Europe’s neighbourhood is also on fire.And yet, if Europe is to fulfil its ambitions of becoming a global actor while also meeting the domestic imperative of generating stronger economic growth and creating jobs, the EU policymakers must look beyond current emergencies to Europe’s medium-to-long-term needs.This is the logic behind the $315bn investment plan drawn up by European Commission President Jean Claude Juncker to modernise Europe’s infrastructure. With its focus on investments in energy, digital, transport and innovation, the blueprint has the potential to revitalise European economies over the next decade.But Europe can’t possibly do it alone. This is why it is important that EU governments, business leaders and academics start paying more attention to China’s headline-grabbing ‘One Belt, One Road’ initiative — and ways in which this could fit in with the EU’s own investment masterplan.After months of staying relatively silent on the subject, the EU policymakers are beginning to talk about — and explore — the advantages of synergies between the Juncker plan and the ‘One Belt, One Road’ initiative.Clearly, joining forces will unleash more resources. Implementing the EU investment plan will require the mobilisation of billions of euros of private and public funds as well as capital from the European Investment Bank (EIB). As European Commission Vice-President Jyrki Katainen said recently, the EU is hoping to attract Chinese investors to stump up some of the capital for the Juncker plan. The point has also been made by European Trade Commissioner Cecilia Malmstrom as well as by the European Commission president himself.The hope is clearly that the EU connectivity projects will be able to interest both the Silk Road Fund and the Asian Infrastructure Investment Bank (AIIB). The EU is particularly interested in meeting the long-term infrastructure needs in southern, eastern and central European countries and in the Balkan states. Greece as well as some members of the so-called ‘16+1’ group of central and eastern European countries have already indicated their strong interest in such Chinese investments. If all goes according to plan, the eastern part of Europe could connect seamlessly with the western projects on the new Silk Road.As the different ‘One Belt, One Road’ projects come on stream, business opportunities will open up for construction, transport and logistical companies — including European enterprises — across the route. EU-China trade is likely to get an important boost from the expected reduction in transport time and costs while EU exporters and investors will gain access to new growth markets in inland China and Central Asia. Such a development would give an added fillip to the current EU-China negotiations on a bilateral investment treaty.As it passes through often-volatile and less-developed countries and regions, the ‘One Belt, One Road’ has the potential to unleash economic potential across the way, bringing stability as well as growth to Europe — and China’s — neighbourhood. Such a conversation could be especially useful within the 53-member Asia Europe Meeting (ASEM) where connectivity is also climbing up the agenda.It’s not just about money, technology and goodwill, however. The EU insists that investment projects selected for financing under the ‘One Belt, One Road’ initiative must meet strict governance, environmental and technical standards, and result in sustainable development.Moving from dialogue to action will require time and effort — and willingness to compromise. China has taken its time in putting flesh on the bones of the project and in explaining its many facets to a closely-watching world. A more detailed dialogue is now necessary before the EU and China get down to identifying and working on the nuts and bolts of their cooperation. Given their different working methods and cultures, European and Chinese policymakers, bankers and business leaders won’t find it easy to work together.The devil will certainly be in the detail. Expectations will have to be managed on both sides. Selecting projects will be difficult and time-consuming. And there will be no quick results.But in a world desperate for money, jobs and modern infrastructure, China has once again shown its capacity to surprise and to think big. Europeans must come on board the Silk Road ‘express’, not just watch it from the sidelines.

3/16/15 3/16/15

View from Abroad: Prepare for ‘hard power’ Europe (Originally published 14/03/2015 at dawn.com)

You would think the European Union has its hands full trying to ease the Eurozone crisis and make sure Greece stays within the monetary union. You also would think the 28-nation bloc was happy with its role as the world’s smartest “soft power”, with no boots on the ground but many diplomats, aid workers and trade specialists ready and willing to work for constructive change in an increasingly volatile world.You would be wrong. Forget gentle persuasion and change by incentive rather than coercion. Carrots over sticks. The EU now wants its own army. It’s a tough world and the EU wants to play as tough as the others.Resuscitating a long-held but equally long-discarded concept, European Commission President Jean-Claude Juncker has called for the creation of a European army to make Europe count on the global stage.No more soft words. It’s going to be about soldiers, guns and aircraft carriers. Europe wants to be a hard-nosed hard power, not a softie.Certainly, Europe is right to be worried — and to want to play hard ball. The world in 2015 is messy, chaotic and often violent, with no clear centre of power. In Europe, as Russia flexes its muscles over Ukraine, many decry the end of the post-World War security order.In Asia, re-emerging nations are clamouring for recognition, jostling each other to gain the upper hand as regional and global leaders. Everywhere, international norms and institutions built in the last century are under stress, and seemingly unable to cope with the increasing demands and insecurity of the 21st century.Juncker has said a European army would restore the EU’s foreign policy standing and show it is serious about defending its values. And he insisted that it would not be in competition with Nato, the US-led Western military alliance.“With its own army, Europe could react more credibly to the threat to peace in a member state or in a neighbouring state,” the Commission chief said in an interview with German newspaper Die Welt.He added: “One wouldn’t have a European army to deploy it immediately. But a common European army would convey a clear message to Russia that we are serious about defending our European values.”Juncker’s proposal does not come out of the blue. The EU has long harboured the idea of an army and has been working hard to forge a credible common security and defence policy for several decades.European military missions are active in the Balkans, Africa and parts of Asia. The soldiers are not there, however, to fight but to monitor elections, keep the peace and manage conflicts.Also, the EU already has battle groups that are manned on a rotational basis and meant to be available as a rapid reaction force. But they have never been used in a crisis.Finally, Europe’s defence is assured by Nato. Put bluntly, if push comes to shove, the US will come to Europe’s assistance with its military might.The timing of the latest proposal is certainly linked to criticism of what many view as Europe’s lacklustre response to Russia’s annexing of Crimea last year and support for separatist rebels in eastern Ukraine.The scene is clearly set for another long and painful — and distracting — intra-European debate. For starters, Germany likes the idea, Britain does not.German Defence Minster Ursula von der Leyen, underlined in an interview that “our future as Europeans will at some point be with a European army.”The UK government spokesman has warned, however that “our position is crystal clear that defence is a national, not an EU responsibility and that there is no prospect of that position changing and no prospect of a European army.”Geoffrey Van Orden, a conservative member of the European Parliament has accused Juncker of living in a “fantasy world”. “If our nations faced a serious security threat, who would we want to rely on — Nato or the EU? The question answers itself,” he said.Nato isn’t too happy either. The civilian and military heads of Nato have said they would welcome increased EU defence spending but cautioned the bloc against duplicating efforts.Analysts say the fundamental problem with the proposal is that, without full political union, it has no chance of becoming a credible force. So long as fierce national rivalries exist at the heart of policymaking, a common army would quickly find itself reduced to a state of impotence if required to deal with any threat to an EU state.EU member states do not often see eye to eye on major global security issues. During the 2011 Libya campaign, for example, Britain and France played a leading role in the air campaign, while Germany’s staunch opposition meant that Berlin wouldn’t even provide air-to-air refuelling tankers.More recently, deep divisions have arisen over how to tackle Russia’s illegal annexation of Crimea and military intervention in Ukraine, with Germany and Italy reluctant to support the economic sanctions advocated by Britain and its allies.Many argue that instead of getting caught up in acrimonious debates on a European army, the EU should focus on intensifying member states’ defence cooperation.“Whatever was Jean-Claude Juncker thinking when he called for the creation of an EU army? The notion may have appeal in Germany and perhaps in Luxembourg, too. Elsewhere, it serves only to supply Europhobes with more evidence of Brussels’s reflexive urge to expand its power,” said Nick Witney, senior policy fellow at the European Council on Foreign Relations.Whitney may be right. But Juncker is in no mood to back down. And if Germany, the EU’s most influential member state likes the idea — and France opts in — one day there will be a European army — of sorts.

2/2/15 2/2/15

View From Abroad: Ties with China are bright spot in Europe’s foreign policy (Originally published 31/01/2015 at dawn.com)

The new European Union Commission, in office since November last year, likes to talk of a “fresh start” for Europe. There is upbeat talk of streamlining EU actions, simplifying procedures, launching a new era of mega investment projects and revving up growth.The reality is more complicated. The election in Greece of a new anti-austerity coalition government headed by Alexis Tsipras has highlighted growing dissent and anger in the Eurozone over the unrelentingly rigid fiscal policies imposed by Germany and followed by the EU.The much-publicised 315 billion euro investment plan launched by the new European Commission President Jean-Claude Juncker may look impressive on paper but is seen by many as too woolly to really generate the growth and jobs that Europe needs so desperately.Additionally, the aftermath of the terrorist attacks in Paris earlier in January means that the Far Right and anti-Islamic parties continue to gain traction and become ever more dominant in the debate on immigration.It’s equally bleak on the foreign policy front. Relations with Russia remain tense. Although there is almost agreement among the 28 EU nations on the need to maintain sanctions against Moscow, depending on their national histories and experiences, European foreign ministers’ attitudes towards Moscow range from very tough (the Baltic states and some Central and Eastern European countries) to soft (Greece and Italy).In the south, the EU is struggling to forge a coherent and meaningful strategy towards Turkey and its other Southern Mediterranean neighbours as well as the Islamic State (IS). European governments also remain divided over whether or not to recognise an independent Palestinian state.Further afield, relations with Japan, South Korea and India remain largely lacklustre and uninspiring. Unlike US President Barack Obama, no European leader can claim to have a glamorous bromance with India’s celebrity Prime Minister Narendra Modi or Japan’s Shinzo Abe.Not surprisingly therefore to many observers in Asia, EU foreign policy seems slow and plodding, focused almost exclusively on trade and business and not enough on a long-term strategy for closer political and security ties.There is one striking exception, however: China. Surprisingly in a world of flux, EU-China relations remain relatively strong, vibrant and multifaceted even as Europe dithers over Russia, India and other emerging nations.The point was made at a meeting of European think tanks in Brussels this week, with experts agreeing that Europe and China must up their engagement. Such consensus is rare in Brussels, especially among academics.Certainly, it’s their mutual economic interdependence that keeps EU-China ties dynamic and buoyant. China’s growth rates may be slowing down but its appetite for European goods and investments continues to be crucial in determining the pace and success of Europe’s economic recovery.China’s economic transformation — and plans for even more change in the coming years — demands that it has access to European know-how, experience and technology.China’s reform agenda also gives European companies myriad opportunities for enhanced trade and investments. Both sides are negotiating a formal treaty to further boost mutual investment flows.Increasingly, also in Brussels there is recognition that a deeper EU-China relationship is important in order to polish Europe’s foreign policy credentials.Europe’s one-time ambition to shape China into a “responsible” international stakeholder now appears hopelessly out-of-date and patronising. But there is no doubt that the EU needs to engage with China on a range of urgent foreign and security policy issues including relations with, Russia, Iran’s nuclear plans, policy towards the IS, fighting Ebola and combating climate change.Significantly, China has invested time, effort and money into upping its relations with Europe. Beijing is working on several tracks at the same time. The focus in recently years has been on further consolidating the China-Germany “special relationship” but also reinforcing ties with former communist nations in Central and Eastern Europe, countries in the Western Balkans and also Nordic states.Responding to critics who complained that Beijing was paying too much attention to European member states and not enough to the EU, Chinese leaders have made it a point in recent months to visit Brussels.The result is a surprisingly solid and well-rounded EU-China relationship which could even become a model for other Asian countries.A key problem, however, is that the EU still treats China as just another emerging nation rather than the regional and global mammoth that it has become. The emphasis is on bread and butter issues like trade and investments, urbanisation, good and valid subjects but do not reflect Beijing’s increasing global clout and outreach.The EU should be looking at thrashing out a new narrative for China which is truly strategic and considers issues like global governance, sustainable development goals and international terrorism.In other words, as the EU and China prepare to celebrate 40 years of their relationship, the EU-China relationship should move from the ritualistic to the strategic — as quickly as possible.