Working Papers (WP) - Elcano Royal Institute (ARI) empty_context Copyright (c), 2002-2018 Fundación Real Instituto Elcano Lotus Web Content Management <![CDATA[ Mody’s ‘Euro tragedy’: the counter story ]]> http://www.realinstitutoelcano.org/wps/portal/rielcano_en/contenido?WCM_GLOBAL_CONTEXT=/elcano/elcano_in/zonas_in/wp13-2019-oteroiglesias-modys-euro-tragedy-the-counter-story 2019-09-16T01:37:28Z

This is a long and dissenting review, in nine acts, of Ashoka Mody’s book EuroTragedy: A Drama in Nine Acts, based on a political economy approach, generally absent in the book.

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Index

Abstract – 2
Preamble – 3
Introduction – 3
Act 1: three leaps in the dark – 6
Act 2: Kohl’s euro – 7
Act 3: Schröder asserts Germany’s national interest – 9
Act 4: irrational exuberance – 10
Act 5: after the bust – 11
Act 6: delays and half measures – 11
Act 7: policy wounds leave scar tissue – 14
Act 8: the ECB hesitates – 16
Act 9: the final act – 18
Scenarios and concluding remarks – 21
Bibliographical references – 22

Abstract1

This is a long and dissenting review, in nine acts, of Ashoka Mody’s book EuroTragedy: A Drama in Nine Acts. It is based on a political economy approach, generally absent in the book. Mody’s work can be added to ‘The euro: it can’t happen, it’s a bad idea, it won’t last’ literature. It presents some fair criticism of the single currency and how the Eurozone authorities have (mis)handled the past crisis, but overall it is too one-sided in its dramatisation of the euro’s history, overlooking key events and the developments that first prompted the introduction of the euro and then made the euro stronger over the years. While Mody thinks the euro is economically illogical and therefore should be discarded, with Germany being the first country to leave, there is a strong consensus among political and business elites –and economists and political scientists on the continent– to retain it. Furthermore, after 20 years public support for the single currency is at its highest ever. There is no attempt by Mody to explain this, which is a pity because overall Mody makes the valid point that for the euro to survive it needs a legitimate political authority to sustain it. The problem is that he thinks that Europe cannot move forward, so he wants it to go backward.

Preamble

I was at first reluctant to read Ashoka Mody’s EuroTragedy. I knew his opinions on the European single currency from following him on Twitter, and I was not sure I wanted to read yet more ‘euro-bashing’ from a scholar based across the Atlantic. I still remembered the pain of reading Joseph Stiglitz’s The Euro: How a Common Currency Threatens the Future of Europe. But as a scholar of the euro you need to read everything that is relevant to the subject and Mody’s credentials cannot be doubted. He is currently Charles and Marie Robertson Professor in International Economic Policy at the Woodrow Wilson School at Princeton University and was previously Deputy Director at the IMF’s Research and European Departments, being responsible, among other things, for the design of the Irish financial rescue package of 2010-11. Thus, in principle, he is certainly knowledgeable about the workings of European monetary union.

The book also received many positive reviews. Foreign Affairs, The Economist and the Financial Times(publications that are often on my screen) considered it one of the best books of 2018, and as we are now celebrating (or lamenting, depending on where one stands) the 20th anniversary of the single currency, I thought it would be good to drop my prejudices and engage with Mody’s nine-act tragedy. Since the book is organised as if it were a play, I decided to follow suit and treat it like drama. Hence, the review is necessarily long, but aims to give the reader the chance to follow my train of thought as I soak in Mody’s story, which is intense and therefore very rich in detail and consequently deserves in-depth dissection. I believe this review can be useful not only for Eurozone scholars, experts and policymakers who have already read the book (quite likely since it is over a year old) but also for those who intend to read it. I think such a structure is also useful for students of European monetary integration. I will certainly ask the students at my courses on the subject to read the book (or at least certain passages) and then give them this working paper review so that they can see that it is possible to have two very different, and sometimes opposing, analyses of the same socio-economic and political phenomenon.

Introduction

While reading the introduction, I discovered early on that this would be another tome in the long list of works written by US (or US-based or educated) scholars and pundits that consider the euro’s creation economically irrational. Lars Jonung and Eoin Drea put it magnificently in a 2009 paper titled ‘The euro: it can’t happen, it’s a bad idea, it won’t last. US economists on EMU, 1989-2002’. Interestingly, 30 years on (1989-2019), the list keeps growing, and Mody’s book is the latest addition to the ‘euro-doom’ tower of scholarly work.

Another striking aspect is the missing parts. There is no engagement whatsoever with key concepts of the international political economy literature that has studied international monetary affairs for over 40 years, such as ‘international monetary power’ and the ‘dollar weapon’, also known in the economic literature as the ‘dollar shock’ (see my work on this). According to Mody, the creation of the euro was strictly an endogenous affair, without considering important, for some decisive, exogenous factors such as US dollar hegemony. As Randall Henning has wonderfully explained in his essential ‘Systemic conflict and regional monetary integration: the case of Europe’, the creation of the euro is above all a defensive move by the Europeans against the monetary power (including the dollar weapon) of the US. There is a strong consensus in the international political economy literature on the subject, with Benjamin J. Cohen –who has done the most to develop the concept of international monetary power over the years– in the lead. But even non-IPE scholars, who have chronicled the evolution of European monetary integration over the past decades, like David Marsh, include the US factor. It is striking that Mody does not.

Mody argues that there were no good economic or political reasons to create the euro and dismisses oft-cited arguments such as the common agriculture policy (CAP). He writes that this was not the reason for creating the euro because it was not written in any official documents. But this is misleading. With the erosion of the Bretton Woods system in the late 1960s, and the ultimate repudiation of it by the US in the 1970s, exchange rate volatility became the norm, so what the CAP needed was to have stable exchange rates. This explains the European obsession with the snake in the tunnel and the European Monetary System and the Exchange Rate Mechanism (ERM). Mody also says that the (irrational) fear of competitive devaluations could not be a reason, because that was not written in any of the documents either. However, one wonders whether the memory of the drama of the devaluations in the 1920s and 1930s was still so strong in the 1960s and 1970s that policymakers did not have to make a written reference to acknowledge its negative consequences. As Barry Eichengreen, perhaps the most renowned monetary historian of our times, has pointed out:

‘Europe, not the United States or Japan, was where floating currencies had been associated with hyperinflation in the 1920s. Europe was where the devaluations of the 1930s had most corroded good economic relations’ (p. 150).

In describing the reasons for further monetary cooperation in Europe, apart from, of course, pointing to instabilities from the dollar area, Eichengreen also highlights that ‘the desire to avoid jeopardizing the CAP, whose administration would be complicated by frequent and sizable exchange rate movements, was a source of support for the Werner Report’ (p. 151).

In finding logical reasons behind the creation of the euro, Mody also overlooks the desire of many peripheral countries, even France, to buy Germany’s price stability culture. Here the essential book is Kathleen McNamara’s The Currency of Ideas, which explains how in the 1980s and 1990s there was an emerging consensus among central bankers that the Bundesbank model was the one to follow and that it therefore made sense to regain part of the monetary sovereignty by creating a supranational central bank, thus having a seat at the table. Marsh (2011) refers to this as the way to overcome the ‘tyranny of the Mark’. In the same vein, there was also a strong desire in Europe, especially in France, to restrain or tame German power. This, again, is well explained not only in Marsh’s account but also in other works by well-known political economists and experts in EMU like Amy Verdun, and especially Kenneth Dyson and Kevin Featherstone in their fascinating Road to Maastricht. Helmut Kohl himself agreed with this taming strategy, as explained more recently by Thomas Klau.

At this point, when I had not even reached the first act, I was realising that Mody had overlooked most of the political economy literature that had been written on the euro in the past 20 years. I went straight to the bibliography and discovered that Henning and Marsh and Dyson and Featherstone were there but after checking the passages quoted I realised most of their references were marginal to Mody’s story. I also discovered that there was no mention of Erik Jones, Mathias Matthijs and Mark Blyth, Waltraud Schelkle, Nicolas Jabko, Manuela Moschella or Michele Chang. One could say: ‘it’s not fair, Mody is an economist so he doesn’t need to know the political economy literature on the euro’. That may be true, but then I checked for well-known economists, experts in EMU, and they were also absent from the  bibliography. Big names like Guntram Wolff, Daniel Gros, Stefano Micossi, Isabel Schnabel, Sebastian Dullien, Nicolas Véron and Paul de Grauwe –for me the leading scholar on the subject, with a textbook on the Economics of Monetary Union that is in its 12th edition– were missing. Neither were there citations of important books on the euro written in recent years, like Pisani-Ferry’s The Euro Crisis and its Aftermath, Martin Sandbu’s Europe’s Orphan and Markus Brunnermeier et al.’s The Euro and the Battle of Ideas. Even giants in the field like Tommaso Padoa-Schioppa is only cited once, and certainly not on account of his most important work on the euro. It is certainly striking.

What was also surprising in the introduction was to see that there was no mention of the popular support for the euro that, according to Eurobarometer, is currently at historic highs, as it was already when Mody was writing the book (see Figure 1). There was also no mention in the introduction of some of the most important institutional innovations in the architecture of the EMU since the euro crisis of 2009-10. Incredibly, the European Stability Mechanism (ESM), the European equivalent of the IMF, and the banking union were absent in the short summary of the book’s key messages. It appeared that Mody was only focusing on the bad and not the good. Hence, having finished reading the introduction, I knew I was in for an ‘interesting’ play.

Figure 1. What is your opinion on each of the following statements? Please tell me for each statement whether you are for or against it. A European economic and monetary union with one single currency, the euro (% – EU)
Figure 1. What is your opinion on each of the following statements? Please tell me for each statement whether you are for or against it. A European economic and monetary union with one single currency, the euro (% – EU)
Source: Eurobarometer, nr 91, Spring 2019.

Miguel Otero-Iglesias
Senior Analyst at the Elcano Royal Institute, and Professor at the IE School of Global and Public Affairs | @miotei


1 I would like to thank Nicolas Véron for reading the whole text and providing valuable comments and suggestions.

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<![CDATA[ From trade diplomacy to economic warfare: the international economic policy of the Trump Administration ]]> http://www.realinstitutoelcano.org/wps/portal/rielcano_en/contenido?WCM_GLOBAL_CONTEXT=/elcano/elcano_in/zonas_in/wp10-2019-higgott-from-trade-diplomacy-to-economic-warfare-international-economic-policy-trump-administration 2019-05-31T12:23:59Z

This paper is an analysis of the discursive practices of the international economic policy of the Administration of President Donald Trump, writ large. Within this conceptual context it offers an empirical case study of the US-China relationship across the spectrum.

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Index

Introduction
(1) The global context
(2) Concepts and theories
(2.1) Discursive practices: from securitisation to economic warfare
(2.2) Economic theory and international economic relations: the rise and fall and rise of economic statecraft and mercantilism
(3) The securitisation and weaponisation of US economic policy: the Trump agenda
(4) The US-China relationship: towards economic warfare?
Conclusion: assessing a Trumpian strategy of political (economic) warfare
The record
Donald Trump and the changing nature of geopolitics
References

Introduction1

This paper is an analysis of the discursive practices of the international economic policy of the Administration of President Donald Trump, writ large. Within this conceptual context it offers an empirical case study of the US-China relationship across the spectrum, from tariff conflict through to the growing struggle for control of the 21st century high-technology industries. The argument is that the Trump Administration utilises the discursive practices of what some scholars call ‘securitisation’ (Buzan et al., 1998) through to what might more appropriately be described as a discourse of ‘economic warfare’.

The paper is in four parts. Part 1 provides a brief discussion of the changing historical and international context of the study. Part 2 provides a conceptual discussion of the discursive practices of securitisation, economic statecraft and economic warfare on the one hand and the theory of international trade captured in the idea of the rise and fall of mercantilism and its re-emergence in the international economic agenda of the Trump Administration on the other. Part 3 looks at these concepts as they pertain to current US international economic policy. Part 4 concentrates on US policy towards China particularly. The paper concludes with some reflections on the success or otherwise of contemporary US policy.

(1) The global context

The cooperation that developed during the period of US ‘self-binding’ hegemonic control (Martin, 2004) over a liberal international order had been under strain in the US since the 1980s when the bilateral deficits with Japan became a major political issue. But it has been since the financial crisis of 2008 that the order has really begun to unravel. The Japan challenge was not sustained but great power competition from both China and Russia has grown. Always fragile, the popular consensus in support of a global liberal order –which was only ever partially liberal and partially global (see Acharya, 2017)– has further dissipated as strong ideological populist challenges have fuelled nationalist politics with attendant practical implications for economic globalisation and international relations in the post 2008 era (see Higgott & Proud, 2017).

This unravelling and great power competition pre-dates Donald Trump becoming President of the US. But it has been exacerbated by his economic nationalist counter-agenda to globalism; an agenda voiced not only by President Trump but also by subordinates in his close policy community –initially by Steve Bannon, but also others such as US Trade Representative Robert Lighthizer, Commerce Secretary Wilbur Ross, Treasury Secretary Steven Mnuchin and Special Economic Adviser Peter Navarro–.2

As this paper will argue, the challenges faced in a search for a new, post-liberal global equilibrium are reflected in both the conceptualisation and practice of economic securitisation and warfare as an instrument of US policy. The contours of any new order will be a highly contested with an increasing interdependence of the two key issues areas –economics and security– and increasing competition between the two principal combatants –the US and China. What might have started as a fairly traditional recourse to a protectionist trade agenda is steadily, and rapidly, morphing into a wider battle between the US and China across the whole spectrum of relations, and especially the battle for technological ascendency in the 21st century. We are witnessing not simply a rhetorical securitisation of US economic policy discourse but a more intense economic and political response to economic globalism in general, and the ascendency of China as a rival global economic power in particular.

For much of the post-World War II era, the relevant government agencies in the US (especially the US Treasury, abetted by the USTR) and the many interested trade and commerce lobbies and pressure groups had sought to treat international economic policy in general, and trade policy in particular, in a manner different to the normal rules of foreign and security policy. Trade policy was seen as a quasi-preserved domain with its own epistemic discourse. This has changed in the current era, where expert knowledge, when not directly rejected or increasingly belittled, is less valued (see Nicholls, 2017).

We are now in an era in which international trade policy, underpinned by a belief in the welfare-enhancing nature of trade openness is under challenge (see Irwin, 2017). This should not lead us into thinking that the globalisation of the international economy as a set of sinews, networks, activities and practices that developed over the last 40 years are somehow coming undone. This is clearly not the case (see Slaughter, 2018; and Baldwin, 2018). Rather, US policy has undergone a major change. An open liberal economic system has been characterised as a licence for others to cheat in their economic relationship with the US.

(2) Concepts and theories

(2.1) Discursive practices: from securitisation to economic warfare

Following 9/11 it became fashionable in some academic and policy quarters to talk about the ‘securitisation’ of US international economic policy. In academic language, securitisation (following the work of the Copenhagen School) was defined as a set of socially constructed and contextual speech acts and processes in which ‘… an issue is framed as a security problem’ (Waever, 1995, p. 75; and Buzan et al., 1998). Evidence of the securitisation of economic globalisation in US policy can be traced far back: from the time of the Raegan Administration and its introduction of the use of VRAs and VERs against the Japanese in iron and steel, machine tools and cars in the 1980s (Reich, 1989) through the to the Bush Administration. It was 9/11 that (perhaps unsurprisingly) firmed up the trend as the Administration proved unable to resist the siren calls to link the narratives of foreign economic and security policy.

For the Bush Administration, globalisation became not only an economic issue but also a ‘security’ problem. As a consequence, the discourse and practice of the securitisation of foreign economic policy developed accordingly. This trend was particularly acute in trade policy where, to illustrate, the granting of the bilateral Free Trade Agreements (FTAs) under negotiation at the time to those who supported the US Gulf War Two initiative (Australia and Singapore) contrasted with the explicit withholding of them from those who refused to join the Gulf War coalition (New Zealand and Chile) (see Higgott, 2004).

The earlier discourse of securitisation did not operationalise the concept of economic statecraft, let alone economic ‘warfare’ –concepts largely applied to non-liberal regimes, notably Russia and China. This study will demonstrate a step change between the Bush era and the contemporary era of the Trump Administration. It will demonstrate that contextual global change and the empirical narrative of international economic policy in general, and trade policy in particular, under the current Trump Administration requires a recognition of both the similarities and differences in the securitisation-economic warfare dialogue not required in the age of George W. Bush. Current US policy is taking us beyond both the securitisation problematic of the Copenhagen School and the traditional understanding of economic statecraft restated recently by Blackwill & Harris (2016). Rather, current US international economic policy should be interpreted through the discursive lenses of an aggressive and pro-active –as opposed to the earlier defensive and reactive– economic warfare.

Current US strategy in trade policy under the Trump Administration offers a counter-veiling argument to the notion that democracies will invariably prefer, à la Joseph Nye, (2004) a soft power diplomatic approach to more atavistic approaches. The preference is now to challenge longstanding commitments to multilateral collective action in the global trade regime with a preference for a strategy based as much on threat as on reward. A comparative analysis of the Bush and Trump Administrations suggests two major differences:

  1. The securitisation strategy of the Bush Administration after 9/11 was underwritten by assumptions of ‘existential threat’ but still with a significant commitment to multilateral institutionalism. By contrast in the Trump Administration’s strategy, without formally articulating it, it is clear that President Trump has a longstanding belief in a mercantilist view of trade with little or no commitment to multilateral institutionalism.
  2. The impact of the communication and technological revolutions on how the dissemination of a securitised trade policy under the current US Administration is practiced, when compared to the tools at the disposal of the Bush Administration, is both more intense and more sophisticated. George Bush did not have the populist communicative skills of Donald Trump nor the weaponry of digital social media, especially Twitter. The message of economic warfare is much easier to disseminate today.

Current strategy and policy harness the discursive instruments, tools and practices short of war to secure the enhancement of national objectives over those of adversaries. If we use the language of security studies we are seeing what Mahnken et al. call ‘… the coercive use of non military instruments to alter adversary behaviour’ (2018, p. 3). This allows us to demonstrate the degree to which our understanding of the discursive practices of trade war can be extended in two ways:

  1. To include allies as well as adversaries as targets.
  2. To extend our focus beyond Russia and China, to the discursive practices of econo-political warfare beyond the traditional understandings of US economic statecraft in recent years (see Blackwill & Harris, 2016).

This comparison of language and practice in US international economic policy is not of courses to suggest any wider similarity between the US on the one hand and China and Russia on the other. The US, for all its current problems, remains a robust democracy while Russia and China are both strongly authoritarian states. But comparative discursive narratives can be identified. In their case study on Russia, Mahnken et al. (2018, p. 10) identify what they see as key themes in the post revolution Bolshevik narrative. Four of the six they identify –(a) ‘we are special’; (b) the ‘country is threatened’; (c) there is a ‘sacred mission’; and (d) ‘victory is assured’– do warrant comparison and find resonance in the Trumpian international economic playbook that stresses:

  1. The residual myth of American ‘exceptionalism’ (‘we are special’).
  2. That the US is disadvantaged by the cheating and free riding behaviour of its major trading partners (‘the country is threatened’).
  3. The presidential mission is to ‘Make America Great Again’ (MAGA as ‘a sacred mission’).
  4. In the economic domain, this has meant a turn to aggressive and unilateral protectionist measures addressed to competitors and allies alike and based on the premise that, in Trump’s own words, ‘trade wars are easy’ (‘victory is assured’).

The analogy permits two further discursive comparisons. First, Vladimir Putin believes Russia was betrayed by the West after the Cold War with its support for the ‘colour’ revolutions in regional neighbours and the eastward expansion of NATO. Similarly, this sense of betrayal is mirrored in the US President’s belief that European allies have been free-riders on US largesse in both the security domain (NATO) and the economic domain (trade imbalances). If his resentments reflect core elements of Trump’s world view, then they lend themselves to explaining his policy responses: bilateralism, transactionalism, aggressive competition, and punishment and retaliation rather than cooperation and multilateralism. In addition, the observation of Trump’s attitudes towards the US’s European allies (for example, his position on Brexit and suggestions to President Macron that France leave the EU) also suggests a willingness to sow division amongst allies where possible. Secondly, the MAGA discourse mirrors Xi Jingping’s emphasis on enhancing respect for China globally after years of humiliation. This theme –that the US must be respected– is to be found in much presidential rhetoric about the lack of deference paid to the US by ungrateful allies.

Richard Higgott, PhD, FRSA, FAcSS
Emeritus Professor of International Political Economy, University of Warwick
Research Professor, Institute of European Studies and Distinguished Professor of Diplomacy, Vesalius College of Global Affairs, Vrije Universiteit Brussel


1 The author is grateful to Luis Simon, Patrick Low, Simon Reich, Jaihong Chen, John Hart, Anthony Milner and Uli Penzkofer for their helpful comments.

2 See Navarros’s documentary, Death by China

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<![CDATA[ The bundle of sticks: a stronger European defence to face global challenges ]]> http://www.realinstitutoelcano.org/wps/portal/rielcano_en/contenido?WCM_GLOBAL_CONTEXT=/elcano/elcano_in/zonas_in/wp03-2019-serrano-the-bundle-of-sticks-stronger-european-defence-to-face-global-challenges 2019-05-07T03:51:30Z

This paper describes some of the main initiatives developed by the EU in the field of security and defence during the last three years and how this has led to a stronger engagement with key international partners. It concludes with some reflections regarding the value of the EU as a platform for cooperation to face global challenges and on strategic autonomy.

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Summary

After an overview of external challenges, this paper will describe some of the main initiatives developed by the EU in the field of security and defence during the last three years and how this has led to a stronger engagement with key international partners. It will conclude with some reflections regarding the value of the EU as a platform for cooperation to face global challenges and on strategic autonomy.

Index

Introduction – 5
1. The challenges – 9
2. Addressing the challenges – 13
3. Cooperating with partners – 27
4. The EU: an unparalleled platform for cooperation on security and defence – 31
5. To conclude – 33

‘… then, handing the bundle to each of his sons in turn, he told them to try to
break it. But although each one tried his best, none was able to do so. The father
then untied the bundle and gave the sticks to his sons to break one by one. This
they did very easily’ (Aesop).

Introduction1

The past three years have seen significant developments in the field of European security and defence. Mostly, they have been pursued in the framework of the implementation of the Global Strategy presented by the High Representative for Common Foreign and Security Policy and Vice-President of the European Commission (HRVP), Federica Mogherini, in June 2016. The main aim is to improve the EU’s capacity to promote its interests and values in an increasingly challenging international environment.

Terrorism, irregular migration, cyber-attacks and foreign interference, including disinformation, figure among the most pressing security concerns of European citizens and societies. Some of these issues are having a significant impact on Europe’s national political landscapes. But to tackle them properly it is key to have a clear and common understanding of their causes.

The Arab Spring revolutions of 2011, and resulting conflicts in Syria, Iraq, Yemen and Libya, as well as destabilisation in the Sahel, have unsettled regional balances and provided space for a new wave of terrorism. Instability and refugees fleeing from conflict have contributed to opening new routes for irregular migration. Organised crime has found a fertile ground in which to spawn, strengthening links to terrorist groups and promoting migrant smuggling and trafficking in human beings. To the East, the 2014 annexation of Crimea and the conflict in Ukraine has brought back into Europe pressing threats to sovereignty and territorial integrity. Hybrid methods of aggression have shown the need to respond in a more complex manner and to enhance societal resilience. A return to global strategic competition further interferes with regional crises and adds new transnational dimensions to challenges and threats.

The EU and its Member States are directly affected and concerned. The level of threat at their doorstep has increased exponentially in the past decade. And they are inevitably part of the broader strategic competition. During the past few years they have been actively developing security and defence instruments and capabilities, they have enhanced their engagement with their partners, notably with NATO, and they have continued to pursue multilateral track to reinforce international peace and security.

Cooperation on development of defence capabilities has, no doubt, been one of the areas of greater expansion, notably through the establishment of Permanent Structured Cooperation (PESCO) and work on a European Defence Fund (EDF). But the EU is also increasing its crisis-management effectiveness with initiatives such as the Military Planning and Conduct Capability (MPCC), the Civilian Compact and the proposal for a European Peace Facility (EPF). The EU is looking more strategically at its deployments to maximise the impact of its efforts, be it in the Sahel or on the high seas, or in other regions, including the Middle East. Conscious of the complex nature of the challenges, it is also developing instruments to face hybrid threats and enhance awareness, including improved cyber security and defence capabilities. The protection of strategic sectors and infrastructure has become a priority.

While enhancing its capacity to act, including autonomously if required, the EU is convinced of the need to cooperate with its partners in addressing security challenges.

The Transatlantic relationship remains crucial to Europe’s security. Ties with NATO have been strengthened considerably through Joint Declarations in 2016 and 2018, co-signed by Secretary General Stoltenberg, President of the European Council Tusk and President of the European Commission Juncker. In fact, much of what the EU has developed recently in the field of defence will support NATO directly, notably as regards capabilities and military mobility. It will also contribute to an improved burden-sharing, particularly as regards hybrid threats and challenges coming from the South.

And a new and strong relationship in the field of security and defence will need to be built with the UK after the latter’s departure from the EU. Challenges and interests will remain common. Most of the EU’s security and defence instruments, including those developed more recently, foresee openings for cooperation with third States. It is to be hoped and expected that the UK will wish to avail itself of such possibilities.

Finally, the EU has continued pursuing a multilateral approach to international peace and security, seeking to strengthen common understandings of the challenges within the international community and develop common approaches to contain proliferation, promote disarmament and prevent an arms race, including in outer-space and in the use of artificial intelligence.

The EU offers its Member States an unparalleled platform for cooperation on all these matters. The breadth of its scope for action and variety of tools allow it to develop integrated approaches covering the complex nature of today’s challenges and linking the internal and external dimensions of security. Jointly, the EU and its Member States are among the world’s most powerful actors. They can project a capacity that dwarfs most others. But having such a capacity is not enough. Tyrtaeus, a Spartan poet, sung that it is not the athletic, artistic or intellectual qualities of a soldier that will bring victory, but his fortitude when faced with the terrible sights of war and his courage in fighting the enemy. The success of the EU will ultimately depend on its Member States’ commitment to promote and defend their common interests and on their determination in this collective engagement. The EU and its Member States are reaching a watershed moment. It is important that this be clearly understood and acted upon.

After an overview of external challenges, this paper will describe some of the main initiatives developed by the EU in the field of security and defence during the last three years and how this has led to a stronger engagement with key international partners. It will conclude with some reflections regarding the value of the EU as a platform for cooperation to face global challenges and on strategic autonomy.

Pedro A. Serrano de Haro
Deputy Secretary-General, European External Action Service


1 This paper expresses the author’s personal views, which are not necessarily those of either the European External Action Service or the EU itself.

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<![CDATA[ The 1981 coup d’état and trial in Spain: possible lessons for Turkey ]]> http://www.realinstitutoelcano.org/wps/portal/rielcano_en/contenido?WCM_GLOBAL_CONTEXT=/elcano/elcano_in/zonas_in/wp7-2019-powell-1981-coup-detat-and-trial-spain-possible-lessons-for-turkey 2019-04-20T11:22:01Z

This paper briefly analyses the attempted coup d’état carried out in Spain in February 1981 and the trial that was held in its aftermath, with a view to extracting possible lessons that might prove useful to those currently engaged in post-coup justice in Turkey.

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Index

Summary
The past as prelude
From Civil War to dictatorship
The transition to democracy
Democratic consolidation and military unrest
The attempted coup of 23 February 1981
The 23-F trial and subsequent appeal (1981-83)
Ten (possible) lessons from the Spanish experience
References.

Summary

This paper briefly analyses the attempted coup d’état carried out in Spain in February 1981 and the trial that was held in its aftermath, with a view to extracting possible lessons that might prove useful to those currently engaged in post-coup justice in Turkey.

The past as prelude

Spain has had a long history of military interventions in political life. In the 19th century, these generally took the form of a pronunciamiento (literally, ‘a pronouncement’), a ritualised challenge for power on the part of the army which became institutionalised as a mechanism for changing the government in office. Contrary to what is often assumed, not all military interventions were reactionary in nature; the liberal and progressive factions in Parliament also had their supporters within the army. Thus, major pronunciamientos resulted in changes of government in 1820, 1843, 1854, 1868 and 1874. Not surprisingly, the constitutional settlement finally reached in 1876 under King Alfonso XII was largely aimed at removing the army permanently from the political sphere, something it achieved quite successfully until 1923.

In the course of the 20th century, Spain experienced five significant military uprisings (in 1923, 1930, 1932, 1936 and 1981), only two of which were successful (those of 1923 and 1936). The first was carried out by General Miguel Primo de Rivera in September 1923, and was opposed by almost no one and welcomed by many. Although this has sometimes been portrayed as yet another pronunciamiento, it was somewhat different in that it aimed to overthrow not just the government of the day but the parliamentary system created in 1876, replacing it with something new. With the tacit acquiescence of King Alfonso XIII, Primo de Rivera was able to establish a formal military dictatorship (1923-25), which subsequently became a civilian one (1926-29), but he failed to consolidate this as a stable form of authoritarian rule. After losing the support of both the King and the army, Primo went into exile in Paris in 1929, where he died quietly in 1930.

In the wake of his departure, the King sought to revive the political system that had existed until 1923, but without success. It was in this turbulent context that a small group of left-leaning army officers rose against the monarchy on 12 December 1930 in support of the republican parties which were actively plotting for a change of regime. The uprising was a complete failure, and its leaders, Captains Fermín Galán and Ángel García Hernández, who had their headquarters in Jaca, a small provincial town in northern Spain, were subsequently court-martialled and shot, as a result of which they rapidly became prominent martyrs of the republican cause.

The collapse of the dictatorship paved the way for free municipal elections in April 1931, the proclamation of the Second Republic and the departure of King Alfonso XIII. The ambitious progressive agenda of the leftists and republicans who largely won the first democratic elections and later wrote the Constitution of 1931 included a far-reaching reform of the armed forces, which was inevitably resisted by the more conservative elements of the military, who interpreted it as an attempt to emasculate them. Ironically, the leader of the first military coup attempt against the Republic, General José Sanjurjo, who had supported Primo de Rivera’s take-over in 1923, had initially facilitated the monarchy’s downfall in 1931 by refusing to use the para-military Civil Guard units under his command against republican demonstrators. However, Sanjurjo soon became disillusioned with the new regime and in August 1932 he led an uprising against the government from his military headquarters in Seville. Although he initially succeeded in taking control of the Andalusian capital, he failed to attract the support of other senior military figures, and the coup attempt collapsed within days, resulting in 10 deaths and the General’s arrest. Sanjurjo was subsequently tried with 150 others and sentenced to death, but the republican authorities, determined not to make a martyr of him, later commuted this to life imprisonment. However, after winning the second general election held under the Republic in 1933, the new centre-right government adopted a general amnesty in 1934 which freed Sanjurjo and his co-conspirators, most of whom later played a prominent role in the 1936 uprising that would eventually lead to the regime’s destruction.

From Civil War to dictatorship

The most significant military coup ever carried out in Spain was of course the right-wing uprising which took place in July 1936. It is often forgotten that a very significant proportion of the Spanish armed forces remained loyal to the Republic, which explains why the coup was only partially successful. Although it has sometimes been described as ‘the rebellion of the Generals’, this is an inaccurate portrayal of events: out of 18 divisional Generals, including those of the Civil Guard and the Carabineros, only four (one of them being General Francisco Franco) took part in the uprising (the uprising should have been led by none other than Sanjurjo, who was in exile in Portugal, but his death in a plane crash accidentally paved the way for Franco’s rise to pre-eminence). Similarly, only 14 of the 56 brigade Generals who were serving at the time rebelled against the government. Overall, of the 15,301 officers in all branches, corps and services active in July 1936, just over half clearly supported the rebellion. The rebels were in fact defeated in most large cities, including Madrid, Barcelona and Valencia, where they came up against the united resistance of other armed forces loyal to the Republic and political and trade-union militants. The division of the army and the police was thus crucial in thwarting the military rebellion, and in preventing it from achieving its immediate goal, the seizure of power. However, by decisively undermining the republican government’s ability to maintain order, the coup d’etat gave way to a civil war and the violence of armed factions.

This only partially successful coup thus led to a bloody, three-year long civil war, something the insurgents had never expected. Ironically, the war ended with yet another coup in March 1939, led by Colonel Segismundo Casado, which has been seen as a ‘rebellion of the officers’ against a Republican government whose legitimacy they no longer recognised. Casado and his camp assumed that it would be easier to settle the war amongst officers, but Franco insisted on an unconditional surrender, which he finally achieved a few weeks later. According to recent estimates, nearly 600,000 Spaniards died in the conflict, of which 100,000 deaths were due to the repression unleashed by the rebels, and 55,000 to the violence in the Republican zone, while another 50,000 were executed in the decade following the end of the war. Much of this repression was carried out under the authority of the Law of Political Responsibility (1939), which set out to punish ‘any person or body’ that had opposed the July 1936 uprising. In other words, it was those who had remained true to the Republic who were to suffer the consequences of their loyalty, while the rebels savoured the fruits of their disloyalty.

The Nationalists’ victory led to the establishment of a personal dictatorship under Franco that survived until his death in November 1975, the only one in Europe to have emerged as a result of a civil war. For obvious reasons, those involved in the 1936 coup were regarded as heroes by the regime, which portrayed the civil war as a ‘crusade’ against communists, freemasons, separatists and other ‘enemies of Spain’.

The transition to democracy

Spain’s democratising process is a paradigmatic case of a ‘transition through transaction’, characterised by the following features: the (paradoxical) use of the former regime’s institutions and constitutional procedures to initiate the democratising process; negotiations between ‘soft-liners’ in the out-going authoritarian regime and representatives of major opposition groups; the inclusion of representatives of all key political forces in the decision-making process; and private, face-to-face deliberations at crucial stages, involving a relatively small number of participants. Some have argued that ‘transitions through transaction’ are also characterised by relatively low levels of popular mobilisation, but the Spanish experience suggests they are compatible with relatively high levels of pressure ‘from below’ if political actors are willing and able to modulate this in response to concessions made ‘from above’. Some also claim that ‘transitions through transaction’ can only succeed in the absence of political violence, but Spain experienced 453 deaths from political violence in 1975-80; indeed, it was partly the fear that this violence might derail the transition process that encouraged political elites to negotiate in the first place.1

Spain’s relatively brief transition to democracy was launched ‘from above’, but it accelerated in response to mounting pressure ‘from below’. It was essentially driven by domestic actors, though the European Community and some of its member states, notably Germany, actively supported democratisation (through its parties, trade unions and political foundations). Its origins largely reflect the political dilemmas facing King Juan Carlos, who needed to acquire a new democratic legitimacy for the monarchy in order to guarantee both his survival as head of state and the continuity of his dynasty. The monarchy Juan Carlos inherited in 1975 was not the institution embodied by his grandfather Alfonso XIII until 1931, but rather an entirely artificial, authoritarian monarchy designed to perpetuate the regime. However, Juan Carlos did not inherit all of Franco’s powers: the Organic Law of the State (1967) had designed a monarchy in which the King’s role was severely curtailed by the combined authority of the Prime Minister and the President of the Cortes (parliament), who shared effective control over the political system. Paradoxically, this meant that from the outset the King had a vested interest in a constitutional reform that would free him from the tutelage of unelected officials.

In the first stage of the transition, Prime-Minister Carlos Arias Navarro, who increasingly identified with the regime’s ‘hard-liners’, advanced a blueprint for limited reform which would have led to the election of a semi-democratic Cortes and the legalisation of some parties, such as the Socialists (PSOE) but not the Communists (PCE). This was rejected outright by an increasingly active opposition, mass mobilisations (which sometimes resulted in loss of life), new media outlets and the European parliament.

The King’s decision to replace Arias Navarro in July 1976 with Adolfo Suárez, a 44 year-old apparatchik of the former regime, known for his ambition and audacity, was a crucial turning-point. Suárez quickly produced a Law for Political Reform which called for a two-chamber Cortes: a Congress of Deputies elected according to principles of proportional representation, and a majoritarian Senate. In keeping with the procedure envisaged by the Francoist fundamental laws, the bill was first approved by the existing Cortes in November by 425 votes in favour and 59 against. In December, it was ratified by a referendum that recorded a 77% turn-out (with 94% of votes in favour), in spite of the opposition’s decision to abstain on the grounds that it had been excluded from the entire process.

The referendum considerably strengthened Suárez’s hand; it was only after it that he engaged in formal talks with the opposition’s ‘Committee of Nine’. The talks centred on the seven conditions the opposition demanded be met if it was to take part in future elections, which included the legalisation of all political parties and trade unions, the political neutrality of public employees, a generous amnesty, the negotiation of an electoral law and the acknowledgement of regional political identities. In fact, these did not constitute formal negotiations; rather, it was a case of Suárez listening to the opposition’s demands and skilfully translating them into legislation. Most importantly, the talks led to the legalisation of the PCE in April 1977, whose exclusion would have rendered the process illegitimate in the eyes of many Spaniards. This paved the way for the first democratic elections, held in June 1977, which, in turn, produced the ideal outcome: the high turn-out (79%) confirmed their legitimacy, and the strong showing by Suárez’s Union of the Democratic Centre (UCD), which obtained 34% of the vote and 165 out of 350 seats, allowed him to remain in office. At the same time, the PSOE emerged as the leading opposition party with 29% of the vote and 119 seats, well ahead of the PCE, which obtained a mere 9% of the vote and 20 seats, while the neo-Francoist Alianza Popular had to make do with 8% of the vote and a paltry 16 seats.

The final stage of the transition consisted of a series of agreements involving all the major political actors. The first of these were the Moncloa Pacts signed in October 1977, which sought to restore growth to an ailing economy and to curb inflation by means of far-reaching structural reforms and negotiated wage restraint. In return for the latter, the Pacts introduced a new system of direct income tax, which would largely finance the spectacular growth of Spain’s health and education systems in the 1980s. Another major initiative adopted in October 1977 and requiring a broad political consensus was the Amnesty Law, which benefited all those tried for so-called political crimes committed against the Franco regime prior to the recent elections, including ETA terrorists who had been convicted of murder. At the same time, however, it also guaranteed that former servants of the regime would not be investigated or prosecuted for the human rights violations they might have committed in the past, thereby ruling out the possibility of purging the armed forces, the police or the judiciary. The Amnesty Law was thus the most significant expression of the tacit, unspoken agreement reached by former Francoists and the democratic opposition in an effort to prevent Spain’s traumatic past from becoming an insurmountable obstacle on the road to democracy. To some extent, this so-called ‘pact of forgetting’ was built on a widely-held interpretation of the civil war which saw it as a fratricidal tragedy for which both sides shared responsibility. As a result of this legislation, ‘transitional justice’ was to be notoriously absent from the Spanish democratising process.

Thirty years later, in what might be described as a belated attempt at ‘post-transitional justice’, the Spanish parliament finally adopted a highly controversial Law of Historical Memory (2007), which offered reparations to those victimised by past injustices and formally condemned the Franco regime as ‘illegitimate’. Surprisingly, however, the law did not nullify the verdicts of those sentenced by Francoist tribunals, including the kangaroo courts created after the end of the civil war in 1939. Nor did it overturn the 1977 Amnesty Law, making it highly unlikely that anyone associated with the old order will ever face prosecution on human rights charges. What is more, in 2010 a court indicted Baltasar Garzón, the judge who had gained world-wide fame for his indictment of Chilean General Augusto Pinochet, on the grounds that he had abused the powers of his office in his attempt to use the Law of Historical Memory to prosecute former Francoist officials. Although he was later acquitted on this count, other charges forced him to relinquish his judicial post, thereby ending all meaningful efforts to bring the former regime to justice, at least for the time being.

By far the most important product of the transitional consensus was the new democratic constitution adopted after 16 months of negotiations between the representatives of all parliamentary parties, which was put to a referendum in December 1978. The debates that dominated the constituent process centred on the same issues that had plagued the Second Republic, but on this occasion they were dealt with far more pragmatically. The Socialists initially put forward an amendment that would have made Spain a republic, but once it was defeated by the other major parties (including the PCE, which had agreed to recognise King Juan Carlos in return for its legalisation), they quickly endorsed the new parliamentary monarchy. The constitution disestablished the Roman Catholic Church, while at the same time acknowledging the right of all children to receive religious instruction in public schools, and the state’s obligation to support religious schools. In its treatment of economic issues, the new text balanced the preferences of the right against those of the left. It explicitly acknowledged the market economy and protected private property and inheritance rights against unlawful confiscation, but also contained guarantees of the right to strike and commitments to provide a broad range of social services, including social security, health, education, disability and unemployment benefits, as well as the promise of a more egalitarian distribution of income. The constitution also included provisions regulating the devolution of powers from the central government to the autonomous communities (regions), paving the way for the development of Spain’s future semi-federal State of Autonomies; although these efforts initially proved sufficient to accommodate Catalan nationalists, they failed to satisfy their Basque counterparts. Finally, while the Francoist Organic Law of the State (1967) regarded the Civil Guard and the then Armed Police (subsequently reorganised in late 1978 as the National Police) as integral parts of the armed forces, the new constitution (article 8.1) distinguished clearly between the military and the security forces. However, the constitution failed to clarify whether the armed forces were simply part of the public administration (like the postal service, say), and therefore totally subordinate to the government, or an institution with its own peculiar characteristics, which enjoyed a special relationship with their commander-in-chief (and head of state). Thus, although the constitution allowed the King to exercise ‘the supreme command of the armed forces’ (article 62 (h)), it also gave the government control of the ‘civil and military administration and the defence of the state’ (article 97).

Charles Powell
Director, Elcano Royal Institute
| @CharlesTPowell


1 Powell (2016), pp. 44-45.
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<![CDATA[ Legislating for a low carbon and climate resilient transition: learning from international experiences ]]> http://www.realinstitutoelcano.org/wps/portal/rielcano_en/contenido?WCM_GLOBAL_CONTEXT=/elcano/elcano_in/zonas_in/policy-paper-2019-legislating-low-carbon-climate-resilient-transition 2019-03-11T08:06:24Z

The study in particular aims to contribute to the current debate in Spain on a draft climate change and energy transition law, as well as aid other countries currently working on climate legislation

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Read the Executive Summary (835KB - PDF)

Leer resumen ejecutivo Legislando para una transición baja en carbono y resiliente al clima: aprendiendo de las experiencias internacionales (664KB - PDF)

Summary

The objective of this working paper is to inform policy experts, legislators and decisionmakers on the recent trends in climate change policy-making around the world and to draw lessons learnt from the experiences with designing and implementing climate change legislation. The study in particular aims to contribute to the current debate in Spain on a draft climate change and energy transition law, as well as aid other countries currently working on climate legislation.

Contents

Introduction and acknowledgements

Executive summary

Part 1. Drivers and global trends in low carbon and climate resilient transition
1. Key drivers of the low carbon and climate resilient transition
2. Global trends in legislating for low carbon transition
3. Building blocks for climate legislation and national governance frameworks

Part 2. Case studies on climate and energy transition laws and executive frameworks
4. The UK’s Climate Change Act of 2008
5. Mexico’s General Law on Climate Change and the Energy Transition Law
6. France’s Energy Transition for Green Growth Law
7. Climate change frameworks in China, Chile, Germany and the US

Part 3. Learning from experiences with climate and energy transition laws and executive frameworks

Recommendations for Spain and other countries for designing framework legislation on climate change

Introduction and acknowledgements

The objective of this working paper is to inform policy experts, legislators and decisionmakers on the recent trends in climate change policy-making around the world and to draw lessons learnt from the experiences with designing and implementing climate change legislation. The study in particular aims to contribute to the current debate in Spain on a draft climate change and energy transition law, as well as aid other countries currently working on climate legislation.

The report is structured in three parts. Part 1 provides an overview of the overall drivers for low carbon and climate resilient transition and the global trends on climate action and identifies the key building blocks of the climate governance frameworks that are important in the design of climate legislation. Part 2 reviews country experiences with designing and implementing climate change and energy transition laws and the executive frameworks in Chile, China, France, Germany, Mexico, the UK and the US. Part 3 draws lessons learnt from the comparative analysis of the case studies on the key elements of a comprehensive climate change law and provides recommendations for policy-makers. Through comparing the insights from each of the case studies the paper draws conclusions on the key considerations that should be addressed in the development of framework climate change and energy transition legislation.

The analysis draws on the latest existing studies assessing the experience with and performance of the legislative instruments in question complemented by assessing the texts of the laws. In this context the study has benefited from the author’s previous work on the UK’s Climate Change Act in collaboration with Sam Fankhauser and Jared Finnegan, and on Mexico’s General Law on Climate Change in collaboration with Sandra Guzman. The case study on France draws upon a recent an in-depth analysis conducted by Andreas Rüdinger.

The author is grateful to several policy experts who have kindly provided contributions on Chile’s climate change policy through informal interviews; to Gonzalo Escribano, Lara Lázaro and Dimitri Zenghelis for detailed review comments. The author also thanks Francisco Trincado for designing the visuals and Miguel de Avendaño, Juan Antonio Sánchez, Virginia Crespi de Valldaura, Luis Lázaro and María Dolores de Azategui for editing the paper. Finally, the author would like to gratefully acknowledge the support and contributions of José López-Tafall and his team at Acciona.

Executive summary

The urgency of action. Climate change is one of the most pressing issues for global and national development agendas. With the last 19 years having contained 18 of the warmest ones on record globally, the urgency to address both the causes and impacts of climate change is clear. According to the Fifth Assessment Report (AR 5) by the Intergovernmental Panel on Climate change (IPCC) for a likely chance of more than 66 per cent of keeping the global mean temperature increase below 2°C, global emissions of all greenhouse gases need to be net zero by 2100.

The economic and commercial case for accelerated low carbon transition is strong. Reaching the target of net zero emissions globally by the end of the century is technically and economically feasible but requires urgent action. The rapid technological change and the falling costs of the key low carbon technologies over the past two decades provide a solid foundation for accelerated decarbonisation. Ambitious action on climate change could yield direct a economic gain of US$26 trillion in 2018-2030 period compared with a business-as-usual scenario according to recent analysis by the New Climate Economy project. Most of the policy and investment decisions shaping the next two decades will be taken over the coming 2-3 years, which makes it a critical period for adopting appropriate policy frameworks.

Scaled-up action requires overcoming barriers to the low carbon transition. Barriers to low carbon investments can be addressed through price and policy signals, as well as mitigated through lowering or sharing the investment risks. Carbon pricing instruments, which now cover around 20 per cent of global greenhouse gas emissions in over 46 countries2, have been shown to be particularly effective in improving viability of low carbon investments. The growing development of new financial instruments, such as green bonds, and the recent advances in the financial regulation on sustainable finance and risk disclosure, are further driving investment towards more sustainable technologies.

Shifts in the international policy landscape require ambitious national action. The adoption of the UN Sustainable Development Goals and the Paris Agreement on climate change in 2015 have set the goal for the global transition to net zero emissions in the second half of this century. Achieving these goals requires not only successful domestic implementation of the current emission pledges, but also a major political transformation in how countries approach climate action and define their ambition. Domestic framework climate change legislation comes to the forefront as the key means to consolidate political support for the climate agenda, to provide the framework for implementation of the Paris Agreement and for assessing progress, as well as to enable ratcheting-up of ambition going forward.

National climate change legislation and policies have grown twenty-fold over the past 20. years, with a remarkable growth in developing countries in recent years. Over time the attention has shifted from putting in place framework climate legislation or strategies for the articulation of greenhouse gas emission targets. In 2017 over 70 per cent of global greenhouse gas emissions were covered either by nationally binding climate legislation or by executive climate strategies with a clearly designated coordinating body, while climate legislation alone covered 44 per cent of emissions and 36 per cent of the population (Lacobuta et al. 2018).

Domestic laws and policies are not yet consistent with international commitments. Most countries need to align their domestic emission targets, enshrined in domestic legislation, and those committed through the nationally determined contributions (NDCs) to the Paris Agreement. In order to meet these targets and to be able to ratchet them up in the future, countries need to put in place strong domestic institutional frameworks and policies.

Framework legislation can help maintain policy continuity and enable implementation. The examples of countries considered in this study demonstrate a variety of approaches to national climate change policy and that there is no one size fits all. Putting policy into law with a strong Parliamentary oversight for implementation helps reduce the scope for backtracking and provides a mandate for policy-makers to advance action. The case studies on Mexico and the UK show that climate legislation has improved the quality of the political debate and helped maintain and strengthen the political consensus on and commitment to the long-term climate objectives through turbulent political times. The case of the US demonstrates how the lack of climate legislation can make climate policy extremely vulnerable to a change of leadership. There are clear advantages for embedding the core elements of the national climate change framework into a legislation for countries like Spain, with a long democratic tradition and limited scope for centralized policy-making by the national government.

The adoption of climate change legislation requires building political support. Developing a positive narrative around the benefits of climate change legislation and creating political momentum are key for passing a law. A positive narrative also helps avoid polarisation of the political debate as was the case in the US. Integrating climate change objectives with economic and social ones and linking the legal framework with a country’s self-interest, development priorities and opportunities or co-benefits of climate action, such as in the example of China, have shown to be effective in getting political and public support for climate policy. Furthermore, following an inclusive process of cross-party development of the key features of the legislation and strong ownership by civil society through stakeholder consultation, as well as personal leadership from the country’s leader, have shown to be effective in getting political buy-in for the legislation in Mexico, the UK, California, France and Germany. Consecutively cross-party and citizen support are the best shields against the risk of reversal of the legislation.

Scope of the law and the level of specificity in prescribing policies is one of the first critical decisions that need to be taken when developing a new legislation. A flexible approach, as in the UK and California, that delegates the choice of specific policies to meet the targets to the government could offer greater political acceptability for the law and flexibility to adjust the course based on changing economic conditions and lessons learnt. However, this model requires that clear institutional processes and statutory timelines for how and when the government should develop the detailed policies are specified in the law backed by strong parliamentary oversight and provisions for an independent review by an advisory body.

Alina Averchenkova
Distinguished Policy Fellowand the lead for the Governance and Legislation research theme at the Grantham Research Institute on Climate Change and the Environment and CCCEP at the London School of Economics
| @averchenkova

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<![CDATA[ Poland in Europe: disappointment or merely hiccup? ]]> http://www.realinstitutoelcano.org/wps/portal/rielcano_en/contenido?WCM_GLOBAL_CONTEXT=/elcano/elcano_in/zonas_in/wp3-2019-kaczynski-poland-europe-disappointment-merely-hiccup 2019-01-31T02:20:17Z

The judicial reforms put the Warsaw government on a collision course with the EU institutions over the rule of law. What is Poland’s position in the EU in the context of the political and economic developments under the Law and Justice government?

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Index

Summary
Introduction
(1) The rule of law debacle
 (1.1) The take-over
 (1.2) The (temporary) fall out
(2) Economic performance: continued convergence
(3) Poland’s position in the EU
(4) Conclusions

Summary

What is Poland’s position in the EU in the context of the political and economic developments under the Law and Justice government? Since 2015 the one-party government in Poland has engaged in a policy of a radical change. A set of various reforms have been implemented, some of them highly controversial, such as the reform process in the judiciary. The judicial reforms –or ‘take over’– put the Warsaw government on a collision course with the EU institutions over the rule of law. This paper analyses three aspects of the Polish-EU relationship: (1) the state of the rule of law; (2) the economic challenges; and (3) the political position of Poland among EU member states.

Piotr Maciej Kaczyński
Independent expert on EU affairs, trainer with the European Institute of Public Administration (EIPA) in Maastricht and member of Team Europe Poland – European Commission Representation in Warsaw, having previously worked at the European Parliament (2012-14), the Centre for European Policy Studies (2007-12) in Brussels and the Institute of Public Affairs (2004-7) in Warsaw
 | @pm_kaczynski

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<![CDATA[ The EU’s role in stabilising the Korean Peninsula ]]> http://www.realinstitutoelcano.org/wps/portal/rielcano_en/contenido?WCM_GLOBAL_CONTEXT=/elcano/elcano_in/zonas_in/wp1-2018-esteban-eu-role-stabilising-korean-peninsula 2019-01-16T06:29:15Z

The diplomatic situation in the Korean Peninsula is changing at enormous speed. In this context, this working paper analyses the position of the EU and its member states towards the current situation and the role they can play in the stabilisation of the Peninsula.

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Index

Preface
1. Introduction
2. Evolution of the EU’s DPRK policy
3. What is at stake
4. A matter of priorities
5. A secondary but significant role for Europe
6. Recommendations
Bibliography

Preface

This working paper is the result of a process of collective reflection in which many academics and diplomats –with whom I have had extraordinarily fruitful conversations in Brussels, Madrid, Pyongyang and Seoul– have participated. The contributions of those who responded to the policy Delphi that we launched in the spring of 2018, and of the participants in the seminar that we organised at the Brussels office of the Elcano Royal Institute on 5 October 2018, were especially valuable. I would therefore like to explicitly thank Alexander Zhebin, Axel Berkofsky, Bartosz Wisniewski, Charles Powell, Eric Ballbach, Félix Arteaga, Françoise Nicolas, Hideshi Tokuchi, Hiro Akutsu, John Nilsson-Wright, Kim Songyong, Lee Dongmin, Liu Qing, Luis Simón, Michael Paul, Mikael Weissman, Niklas Swanström, Ramón Pacheco, Shin Beomchul and Tariq Rauf for their contributions. I would also like to acknowledge the work of Elisa Lledó in organising the seminar and of Virginia Crespi de Valldaura in helping to prepare this paper.

I similarly want to thank the Korea Foundation for its generous support, without which this investigation would not have been possible.

The views expressed in this working paper are my own and do not necessarily reflect the position of any of the persons consulted, nor do they reflect the policy stance or the official position of any institution.

1. Introduction

The diplomatic situation in the Korean Peninsula is changing at enormous speed due to the conjunction of three factors: the rapid development of the North Korean nuclear programme under the leadership of Kim Jong-un, the election of Donald Trump as US President and that of Moon Jae-in as President of South Korea. In this context, this working paper analyses the position of the EU and its member states towards the current situation and the role they can play in the stabilisation of the Korean Peninsula.

The Democratic People’s Republic of Korea (DPRK) spectacularly developed its nuclear capacity in a very short space of time thanks to its byungjin doctrine, which focuses on  the parallel development of the national economy and the nuclear programme. This development greatly alarmed the international community. The alarm was only heightened by Donald Trump’s election. His escalating exchange of heated rhetoric with Kim Jong-un and his coercive diplomacy notably increased the risk of military conflict on the Korean Peninsula. Indeed, to millions of Koreans and their neighbours, war seemed like a plausible scenario by the end of 2017.1

Nevertheless, the situation changed radically in the first months of 2018, when two parallel diplomatic processes involving North Korea were initiated. The first concerned South Korea and was aimed at seeking the reconciliation of the two states; the second concerned the US and sought to achieve denuclearisation and the pacification of the Korean Peninsula.

This increased use of diplomacy to tackle tensions in the Korean Peninsula was motivated by two factors.

First, the North Korean regime considered that the progress of its nuclear and missile programme in 2017 had provided it with a powerful and reliable deterrent against foreign intervention in its territory. Kim Jong-un himself proclaimed the success of the North Korean nuclear programme in his New Year’s Speech: ‘Our country’s nuclear forces are capable of thwarting and countering any nuclear threats from the US, and they constitute a powerful deterrent that prevents it from starting an adventurous war’.2 This position of strength allowed the North Korean regime to suspend its missile and nuclear tests, thus fulfilling    a key prerequisite to enable the South Koreans and the Americans to engage in public negotiations with Pyongyang.

The second factor is that all three statesmen had strong incentives –mainly relating to their internal political aims– to embark in a negotiation process. Thanks to these diplomatic openings, Kim Jong-un has attained a level of international recognition that seemed impossible when he first succeeded his father. This has substantially strengthened his authority within the DPRK. Furthermore, the détente created by following this diplomatic route improves North Korea’s security situation while avoiding the threat of new sanctions and creating a propitious situation for current sanctions to be interpreted more laxly. This all favours the North Korean government’s current key objective: to focus on the economic development of the country.3 President Trump, on his part, has constantly tried to project an image of himself as an outstanding negotiator and to portray this as a key asset of his presidency. Nevertheless, his presidency has so far been characterised more by abandoning international treaties (including the TPP, the Paris Agreement on climate change, the Iran nuclear deal, and the Intermediate-Range Nuclear Forces Treaty) than by negotiating new ones. The North Korean nuclear and missiles programme gives him the opportunity to shine where his predecessors have failed.

In the case of President Moon, reconciliation with Pyongyang was one of the pillars of his electoral platform. This meant that part of his prestige would be at stake if he did not make progress in that direction. Instead, the inter-Korean reconciliation process, and especially the Panmunjom Summit of 27 April 2018, allowed Moon to reach the first anniversary of his mandate with an 83% approval rating –an especially significant result taking into account the unimpressive level of growth experienced by the South Korean economy in the period–. Such a level of popularity after only one year in power is unprecedented for any South Korean President.4

Despite the huge scepticism towards the possible outcome of the negotiations, there is international consensus on the convenience of promoting dialogue to dissipate the threat of war in the region.

The developments outlined above are of enormous importance due to their potential multiple consequences. They not only affect the future of all Korean citizens, but also the peace and security of the region and the globe, the international nuclear non-proliferation regime, Sino-US relations and the East Asian balance of power. As a result, the EU cannot afford to stay on the side-lines of these processes, even if it is undoubtedly going through serious internal difficulties and has other priorities on its foreign policy agenda. This working paper therefore presents a sober and realistic analysis of the role that the EU and some of its member states can play to contribute to the denuclearisation and inter-Korean reconciliation processes. It concludes that its role is secondary but significant. In addition, the paper presents a set of recommendations on how European involvement could materialise.

Mario Esteban
Senior Analyst, Elcano Royal Institute
| @wizma9


1 Gallup International (2017); and USA Today (2017).

2 Kim Jong-un (2018).

3 This aim is stated in the resolution approved in the Third Plenum of the Central Committee of the Workers’ Party of Korea, ‘On concentrating all efforts on socialist economic construction to meet requirements of new high stage of developing revolution’.

4 USA Today (2018).

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<![CDATA[ Natural partners? Europe, Japan and security in the Indo-Pacific ]]> http://www.realinstitutoelcano.org/wps/portal/rielcano_en/contenido?WCM_GLOBAL_CONTEXT=/elcano/elcano_in/zonas_in/policy-paper-2018-natural-partners-europe-japan-security-indo-pacific 2018-11-12T12:06:30Z

There is momentum for increased security cooperation between Europe and Japan. Europeans and Japanese are ‘natural partners’ who consider a liberal and rules-based international order to be a core interest.

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Introduction

Europeans and Japanese are often described as ‘natural’ partners. As liberal democracies, market economies and close allies of the US, they have similar world views and share many interests. They also have a long history of cooperation, whose foundations go back to Japan’s embracing of modernisation and industrialisation in the late 19th century along European lines.

Both during and after the Cold War, Europeans and Japanese have worked closely to uphold and promote the institutions that make up the liberal, rules-based international economic order, such as the World Trade Organisation (WTO), the International Monetary Fund (IMF), the World Bank (WB) and the G7. In more recent years, Europeans and Japanese have shown a keen interest in extending their cooperation to the security domain, both on a bilateral basis (ie, between Japan and individual European countries) and through the EU and NATO.

Given their shared values and interests, the foundations for a meaningful security relationship between Europe and Japan appear strong. Yet both sides continue to focus primarily on their immediate neighbourhoods and their respective relationships with the US. For Japanese and Europeans alike, the US has played an equally vital strategic role: guaranteeing security in their respective regions and upholding a liberal international political and economic order from which they have benefited enormously.

In recent years, significant geopolitical developments have altered the context in which both Europe and Japan operate, and may force the two sides to change the way in which they look at each other.

Russia and China have begun to challenge more openly and forcefully the rules-based liberal international order, both regionally and globally. The Russian and Chinese regimes are attempting to build an international order that is more in line with the political and economic interests of their ruling elites. They both seek to modernise their military capabilities and are engaging in acts of political intimidation and economic blackmail that threaten to disrupt the status quo in Europe and East Asia, respectively.

At the global level, Moscow and Beijing reject the notion of a liberal and open system, a level playing field where economic and political actors can compete freely. Instead, they prefer a controlled, top-down order. Geopolitically this translates into spheres of influence, whereby great powers call the shots and medium and small powers have no say, losing the certainty and protection offered by international rules and organisations and being left with nothing but the prospect of submission.

At the same time, it has become less clear in recent years –especially since the election  of Donald Trump as President– to what extent the US is willing to underwrite the current global trade and economic order. This has implications that are global –witness the Trump Administration’s seeming disdain for the WTO– as well as regional, given the US withdrawal from the Trans Pacific Partnership (TPP) and its equivocal position in relation to the Transatlantic Trade and Investment Partnership (TTIP).

When it comes to security, concerns about China’s rise, Russia’s growing assertiveness and the prospect of a relative US decline have sparked some doubts amongst Europeans and Japanese about America’s commitment to preserving deterrence in their respective regions. Uncertainty has been further fuelled by Trump’s rhetoric on alliances.

The developments mentioned above are compelling both Japanese and Europeans to adapt their respective foreign policy strategies. In recent years, Japan has adopted an increasingly active diplomatic and security role in East Asia, a process dubbed by some ‘normalisation’. Certainly, Tokyo has not abandoned the principles that have shaped its (pacifist) identity in the past decades and it continues to see military force as a last –defensive– resort. However, an increasingly threatening regional environment has led Japan to increase its defence budget, ease the legal restrictions on its Self-Defence Forces, strengthen its bilateral alliance with the US and expand its diplomatic and security ties with several countries across East Asia and the broader Indian Ocean region. This is reflected in Prime Minister Abe’s vision of a ‘Free and Open Indo-Pacific’ (FOIP).

Japan’s FOIP is partly a response to China’s Belt and Road Initiative (BRI), an attempt to re-order the Indo-Pacific and Eurasian spaces according to China’s priorities and rules. Moreover, in view of the growing uncertainty about Washington’s vision on trade, Tokyo has embraced the flagship of global free trade –including a robust defence of the WTO– and taken a leading position on TPP after the US withdrawal.

On the European side, a new debate has emerged around the concept of European ‘strategic autonomy’, underscored by the 2016 European Global Strategy. In this context, Europeans have embarked on a number of new initiatives aimed at strengthening European defence cooperation, both in the context of the EU (eg, Permanent Structured Cooperation, European Defence Fund, Coordinated Annual Review on Capabilities) and outside it (eg, European Intervention Initiative).

Moreover, Europeans remain committed to reinvigorating transatlantic trade and economic ties, and the notion that such ties can help raise global standards in key areas such as free trade and environmental protection. Indeed, after European Commission President Jean-Claude Juncker’s meeting with Trump in July 2018, the idea of some form of ‘TTIP light’ has emerged.

Against the backdrop of these broader geopolitical changes, Europe and Japan have shown a growing interest in strengthening their strategic ties with each other. The progressive normalisation of Japan’s foreign and security policy and opening up of its defence industry has paved the way for greater security and defence cooperation with Europe. The UK and France have led the way, stepping up their military and defence-industrial cooperation with Japan in recent years, and countries like Italy and Spain are following suit. Germany, for its part, has developed a growing diplomatic and economic interest in Japan, a country with which it shares a preference for rules and multilateralism.

The rising cooperation in European-Japanese relations goes beyond individual countries and has also affected Europe’s collective institutions. The EU and Japan have recently concluded the negotiation of their Economic Partnership Agreement (EPA), the biggest bilateral trade agreement ever negotiated by the EU. The EU-Japan EPA promises important direct economic benefits for both parties. More broadly, however, it signals that the EU and Japan consider free trade to be the backbone of a multilateral liberal order. In addition to the EPA, the EU and Japan have concluded a Strategic Partnership Agreement (SPA) that aims to lay more solid foundations for deeper political and security ties between Japan and the EU. The SPA will be ‘a legally binding pact covering not only political dialogue and policy cooperation, but also cooperation on regional and global challenges, including environment and climate change, development policy and disaster relief, and security policy’.

Japan has also taken a number of steps to strengthen its relationship with NATO. This has resulted in a number of practical initiatives in recent years, such as the secondment of a Japanese Self-Defence Forces officer to NATO headquarters and the official designation of its Embassy to Belgium as its Mission to NATO, which was accepted by the North Atlantic Council in June 2018.

The strengthening of Europe-Japan relations –perhaps best illustrated by the EPA-SPA–  is a timely phenomenon. With a US President following a disruptive approach towards international trade, and an uncertain US commitment to the global economic order, Japan and the EU –the two other key pillars of the liberal global economic order– are not only holding the fort but deepening their economic, political and security ties. The shared challenge in the years to come is to engage the US and bring it back into the fold of the liberal, rules-based international order. After all, and despite current problems, the US remains essential to the security of both Europe and Japan, as well as for the integrity and stability of the liberal international order.

The big shadow looming over European-Japanese relations is China. For many years Europeans have looked at Asia –and the broader Indo-Pacific region– primarily as a place for business. European business, especially German, has built strong ties with China and such economic ties have paved the way for political and diplomatic links between Europe and China. Thus, a key question for the future is how Europeans will balance their economic interdependence with China and their growing interest in developing security and economic ties with Japan, especially as Beijing’s neo-mercantilist approach and challenging of international rules clashes with Tokyo’s vision of a Free and Open Indo-Pacific.

About this Policy Paper

Against the backdrop of these geopolitical changes, and given the growing interest on both sides, it is appropriate to take stock of the European-Japanese relationship and explore the potential for increasing cooperation. This paper’s aim is to explain how Europe’s key players and institutions are approaching Japan, and to outline some possible ways to move the relationship forward.

With security at the centre of the exercise, the paper more specifically focuses on the Indo-Pacific, a concept so far officially embraced by the Japanese and US governments but that offers much potential to Europeans –to the extent that the Indian Ocean remains Europe’s main gateway into what some argue will be an Asia-Pacific century. However, we approach the Europe-Japan relationship through the lens of one of the sides: Europe.

In a way, the question of how to frame security cooperation with Japan in the Indo-Pacific is a proxy for a broader question: how will Europeans position themselves at a time increasingly defined by the shift in the global centre of strategic and economic gravity towards the Indo-Pacific?

In this paper a group of experts address these questions from the viewpoint of Europe’s main powers and institutions, using Japan and the Indo-Pacific as a compass. How will Europe’s key players and institutions balance their relationship with China and Japan, and how will they navigate their competing approaches to rule and order in the Indo-Pacific? Put differently, how will they balance their economic interest in strong ties with China and their political and strategic interest in Japan, and their (supposed) alignment with Tokyo’s vision for a Free and Open Indo-Pacific? In addressing these broad questions, each of the authors has been given the editorial freedom to approach them through the lens and specificities of each individual case.

In the first essay, Céline Pajon examines France’s efforts to step up its security cooperation with Japan in recent years. In particular, France’s military and defence-industrial prowess, its maritime capabilities and its status as an Indian-Ocean power open up important opportunities for greater security cooperation with Japan. In the second essay, Philip Shetler-Jones depicts the UK’s relationship with Japan as a ‘quasi-alliance’ underpinned by a long history of cooperation and their common nature as sea-borne powers.

While France and the UK –two maritime powers with global interests– have stepped up military cooperation with Japan, Germany is also increasingly interested in deepening ties with Tokyo but is primarily stressing diplomacy and shared norms, as explained by Ulrich Speck in the third essay.

Europe’s other maritime powers (Italy and Spain) are also showing an increasing interest in the security of the Indo-Pacific and in building stronger security ties with Japan. As Alessio Patalano’s contribution shows, Italy sees Japan as a like-minded country and is sympathetic to Tokyo’s vision of upholding a Free and Open Indo-Pacific. In particular, Italy has shown interest in working with Japan in East Africa, where its longstanding economic and political ties converge with Tokyo’s emphasis on connectivity and infrastructure development. Similarly supportive of the concept of a Free and Open Indo-Pacific is Spain, which has signed a Strategic Partnership with Japan in 2018, as detailed by Mario Esteban and Elisa Lledó.

In the sixth essay, Jacek Bartosiak looks at Japan and the Indo-Pacific from the point of view of Poland. While its continental location may make the connection with Japan (and the Indo-Pacific) less obvious, Poland’s condition as Europe’s gateway to China’s BRI makes it an interesting case. More broadly, as Bartosiak points out, there is a significant parallelism between Poland and Japan, as they are both emerging as the centrepieces of the US-led regional deterrence architecture in Europe and East Asia, respectively.

Europe’s multilateral institutions have also shown a growing interest in Japan. As Lisa Picheny points out, NATO and Japan consider themselves ‘natural partners’ and have a history of cooperation in the Alliance’s mission in Afghanistan. And in recent years NATO and Japan have strengthened their cooperation even further as they now hold annual consultations and are cooperating on a number of specific projects, including in the area of cyber-defence.

In the final essay, Daniel Fiott discusses the EU’s growing interest in Japan in the context of the EPA-SPA and looks more closely at the potential for greater security cooperation. Certainly, Brussels continues to look at Japan primarily through an economic and diplomatic lens and is trying to maintain a degree of neutrality with regard to territorial conflicts in the Indo-Pacific. But the revamping of the EU’s Common Security and Defence Policy and the EU’s growing interest in defence research and innovation could open up greater opportunities for engaging with Japan.

Luis Simón & Ulrich Speck

Conclusions

Europe’s security and ability to remain a global player hinge in no small part on its ability to project influence in the Indo-Pacific space, for that is emerging as the central nervous system of both the global economy and global geopolitics. Europeans have a direct stake in the preservation of a rules-based liberal order there. And that means they cannot remain on the side-lines in the unfolding process of great power competition in the area.

In order to project their interests and values in the Indo-Pacific space, Europeans need partners. This is where Japan comes in. Japan is of key importance to Europe for two main reasons. First, because Japanese and Europeans hold common values and have shared interests in relation to the Indo-Pacific as well as globally; secondly because among the several like-minded partners Europeans have in the Indo-Pacific, Japan stands out because of its critical mass, in particular its economic muscle, but also its diplomatic and security potential. In this context, Japan’s progressive normalisation of its security policy and its growing interest in the Indo-Pacific maritime axis open up a number of opportunities for Europe.

One of the main points emphasised in this report is that Europeans have indeed a growing interest in the Indo-Pacific and in strengthening their security ties with Japan. To be sure, Europeans do not want to become embroiled in territorial tensions in places like the South or East China Seas. Even the two European countries with a stronger military and global profile –the UK and France– insist that they do not want to take a firm stand on sovereignty-related questions. However, all of Europe’s key players and institutions have a position on matters of principle: in particular, they embrace the notion of an open and free maritime domain, free trade and a multilateral and rules-based approach to conflict resolution. These principles stand in sharp contrast to the notion of exclusive zones of influence, mercantilism and unilateral approaches to territorial conflicts.

It is the defence of these broader liberal principles that bring Europeans and Japanese together. In recent years, Japan has stepped up its security profile and emerged as one of the bastions of a free and open rules-based order in the Indo-Pacific. Its position stands in contrast to China’s increasingly assertive approach to territorial claims and neo-mercantilist efforts to re-order the Indo-Pacific space.

An important driver of Europe’s growing interest in Japan is the realisation by most of Europe’s key powers and institutions that China is unlikely to accept a multilateral, rules-based approaches to conflict resolution, as Beijing continues to assert its territorial claims with little regard for the interests and views of its maritime neighbours. The moment this became clear was when China reacted to the South China Sea Arbitration to the case brought by the Philippines against China under Annex VII to the UN Convention on the Law of the Sea (UNCLOS), concerning certain issues in the South China Sea including the legality of China’s ‘nine-dotted line’ claim. When on 12 July 2016 the Permanent Court of Arbitration ruled in favour of the Philippines, China flatly rejected the ruling, putting an end to the hope that international law could halt China’s challenge to the status quo in the region.

Besides Chinese assertiveness, there are other factors driving the current European-Japanese rapprochement. One key factor is the leadership role played by the UK and France. The two countries have a long history of engagement in the Indo-Pacific and have shown a growing interest in cooperating with like-minded powers (such as Japan, South Korea, Australia and India in recent years). They both see the Indo-Pacific as a key strategic arena and, as major military powers with a permanent seat at the UN Security Council, they feel the need to show their presence.

Additionally, there is the promise of cooperation in the defence industry domain. Japan’s edge in new generation technologies (e.g., autonomy, cyber, robotics, etc.) could be a key asset for Europeans as they seek to grapple with the challenges of military-technological innovation at a time when the US is embarking on its so-called third offset strategy. Greater cooperation in defence-industrial matters could help Europeans and Japanese diversify their partnerships in that field, reducing their technological-strategic dependence on the US, and reap mutual benefits in terms of defence innovation. In this regard, Europeans should explore how they can leverage the work of the European Defence Agency and the Commission’s newly established European Defence Fund to further their defence research and industrial cooperation with Japan.

Beyond security, another important driver of a closer Europe-Japan partnership is the sense that other dimensions of the liberal international order are also threatened. That includes, in particular, the free and open economic order that has allowed globalisation to thrive, and the institutions and norms that have enabled it to do so (such as the WTO and the broader principle of free trade). It is in this area where Germany has been particularly active by pushing for closing the EU-Japan trade deal and by offering Tokyo a closer partnership in the framework of the so-called ‘alliance of multilateralists’.

Regardless of the general openness and interest on Europe’s part to strengthen cooperation with Japan, there are also a number of important obstacles going forward. One of them is lack of unity. While there is a broad agreement among European players, forged in such forums as the EU and the G7 summits, each of them is moving ahead individually according to its national or institutional priorities. Overall this leads to a fragmentary approach. Alignment of Asia policies among Europeans could become even harder after Brexit, especially if disengagement is not balanced by new mechanisms for the coordination of foreign and security policies.

Another limiting factor is the need to balance support for the liberal order and like-minded countries in the region with the relationship with China. Europeans do not want to be put in a position where they have to side with one party or the other in the event of a heated territorial conflict in the Indo-Pacific. While there is increasing scepticism about the compatibility of the Chinese model of governance with the liberal order, the European economy remains deeply interconnected with China’s.

Last but not least there is geographical distance. Most European countries are focused primarily on their geographical neighbourhood. And in recent years the number and urgency of conflicts there has increased, from Ukraine to Syria. Only a few of the bigger European countries really feel that they have an important stake in the Indo-Pacific.

On balance, there is momentum for increased security cooperation between Europe and Japan. Europeans and Japanese are ‘natural partners’ who consider a liberal and rules-based international order to be a core interest. They are both particularly interested in the Indo-Pacific –a key lifeline for European-Asian trade– and in preserving a liberal and rules-based order there. They are both equally worried about the seemingly unwavering US commitment to multilateralism. And, critically, they both believe that greater engagement on their part could serve to both hedge against the prospect of US disengagement as well as constitute a powerful incentive to bring the US back into leading the liberal, rules-based order.

Luis Simón & Ulrich Speck

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<![CDATA[ Forty years of democratic Spain: Political, economic, foreign policy and social change, 1978-2018 ]]> http://www.realinstitutoelcano.org/wps/portal/rielcano_en/contenido?WCM_GLOBAL_CONTEXT=/elcano/elcano_in/zonas_in/wp1-2018-chislett-forty-years-democratic-spain 2018-10-17T02:19:44Z

Over the past 40 years, Spain has achieved conditions that are similar –in some cases better– than in the rest of Western European nations, disproving the theory, still beloved in some quarters, of the country’s ‘exceptional nature’ or ‘anomaly’.

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Summary

Whichever way one looks at it, Spain has been profoundly transformed since the 1978 democratic Constitution that sealed the end of the 1939-75 dictatorship of General Francisco Franco, the victor of the three-year Civil War. Be it economically with, for example, the creation of significant number of multinationals or the world’s second-largest tourism industry in terms of visitors (81.8 million in 2017), politically with a vibrant democracy that ranks high in classifications, socially with the greatly improved status of women or in foreign policy –where Spain has reclaimed its place on the international stage–, the country bears no resemblance to what it was like 40 years ago. Over the period, per capita income at purchasing power parity increased fivefold and life expectancy at birth rose by almost 10 years. All the more remarkable is that the transition, guided by King Juan Carlos I, was achieved in the face of considerable adversity. It was not guaranteed from the outset to be successful: the Basque terrorist group ETA killed an average of 50 people a year in the first decade of democracy (and mounted assassination attempts in 1995 on both the King and the Prime Minister, José María Aznar), and Francoist officers staged a coup in 1981 in an attempt to turn back the clock. The economy, which was entering a period of recession, galloping inflation and rising unemployment, was also subjected to unprecedented competition after decades of protectionism. In the first three months of 1976 there were 17,731 cases of industrial action alone. Today’s problems, such as the very high jobless rate, particularly among young adults, acute income inequality, increased social exclusion, the illegal push for independence in Catalonia and corruption in the political class do not detract from the fact that Spain has enjoyed an unprecedented period of prosperity and stability over the past 40 years. Spain has achieved conditions that are similar –in some cases better– than in the rest of Western European nations, disproving the theory, still beloved in some quarters, of the country’s ‘exceptional nature’ or ‘anomaly’.

William Chislett
Associate Analyst, Elcano Royal Institute
 | @WilliamChislet3


I would like to thank the following for helping with this report: Joaquín Almunia, Alicia Coronil, Alain Cuenca, Sir John Elliott, Omar Encarnación, Ángel de la Fuente, Josep Giménez Miralles, Esperanza Gutiérrez Gómez, Professor Harold James, Jordi Maluquer de Motes, Valeriano Muñoz, Antonio Muñoz Molina, Rafael Pardo, Inés Pérez-Durantez, Michael Reid, Ignacio Sánchez Amor, Oriol Sabaté and Friedrich Schneider.

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<![CDATA[ EU scenarios for 2027 ]]> http://www.realinstitutoelcano.org/wps/portal/rielcano_en/contenido?WCM_GLOBAL_CONTEXT=/elcano/elcano_in/zonas_in/wp19-2018-estella-eu-scenarios-for-2027 2018-10-08T10:40:07Z

This paper is written at a very critical time for the EU. However, in these distressed times for the European project, it seems more appropriate than ever to discuss in public what its future will be.

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Index

(1) Introduction – 3
(2) The prediction for 2017: rights and wrongs – 4
 (2.1) Enlargement – 4
 (2.2) The 2008 crisis – 7
 (2.3) Between the status quo and the variable geometry scenarios – 10
(3) Refining the 2027 prediction – 19
 (3.1) Integration – 20
 (3.2) Independent variables – 20
(4) Independent variables at work – 23
 (4.1) Enlargement – 23
 (4.2) Economic growth – 23
 (4.3) Immigration – 25
 (4.4) Exit(s) – 27
(5) Conclusions – 34
(6) Bibliography – 35

‘Our wills and fates do so contrary run, that our devices still are overthrown; our thoughts are ours, their ends none of our own’.

—William Shakespeare
Hamlet, Act 3, Scene 2.

(1) Introduction

In 2008 I published a paper on ‘EU scenarios for 2017’ (Estella, 2008). It was written over the course of 2007, discussed in different economic, legal and political circuits, and finally published by the Elcano Royal Institute a year later. The report was motivated by the discussion on the future of the EU that started that year with the establishment by the European Council of 14 December 2007 of the so-called ‘González’ reflection group. The group, chaired by the former Spanish Prime Minister Felipe González, started work at the beginning of 2008 and delivered its final report in 2010 (European Council, 2010). The aim of my 2008 report was to try to ascertain where the EU would be in 2017, and why it would be there.

The object of this working paper is to make exactly the same exercise that I did 10 years ago and make a projection on what the future of the EU will be in the coming 10 years, that is, in 2027. As in 2007, this kind of exercise is prompted, first and foremost, by a prior move by the EU’s institutions, which began the same debate in March 2017. In the European Commission’s White Paper titled ‘Reflections and scenarios for the EU27 by 2025’, it reflects on the different scenarios in which the EU could be in 2025. For reasons of symmetry with my 2008 paper, I have added two more years to my own analysis: peu importe. The results will not be dramatically modified by the addition, since we are looking at the structural trends that are impacting upon the EU’s fate.

This paper is written at a very critical time for the EU. Among other issues, the European project is just starting to overcome the most serious economic crisis that Europe and the world have seen since the 1929 crash: the financial crisis that began in 2008, which impacted the EU very severely. The EU is also currently suffering from the stress caused by Brexit, which will have, as this paper will argue, unprecedented consequences for the future of the European project. And finally, the Union is troubled as a result of the regionalist movements that some Member States, notably Spain, are witnessing at the time of writing. As Louis Armstrong song aptly claims: ‘so little time, so much to do’. However, in these distressed times for the European project, it seems more appropriate than ever to discuss in public what its future will be (see Closa & Molina, 2018).

Antonio Estella
Jean Monnet Professor of Law and European Economic Governance, Universidad Carlos III, Madrid
 | @antonioestella

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