European Union

A

EU Expansion

By 1995 all the former Communist countries of Eastern Europe had applied for EU membership. The countries of Eastern Europe had less-developed economies than those of Western Europe, raising questions about their ability to cope with the competitive pressures of the EU’s internal market. In addition, the EU was concerned about the stability of democratic institutions in these countries and their commitment to human rights and the protection of minorities. Expansion would require a significant reevaluation of EU programs—especially the CAP—and distribution of EU resources. The richer member states worried that they would have to pay more into EU funds, while poorer member states feared that their share of EU funding for agriculture and regional development would be drastically reduced. Equally, it was argued that enlargement without significant institutional reform would reduce the effectiveness of the EU.

Despite these worries, trade between Eastern and Western Europe substantially increased after 1990. Western nations began to make commercial investments in Eastern Europe; at the same time, the EU provided economic aid, formed joint ventures, and signed formal agreements of political and cultural cooperation. In 1997 the EU agreed to open membership talks with Cyprus, the Czech Republic, Estonia, Hungary, Poland, and Slovenia, with EU membership coming sometime after 2000. Then, in 2000, the EU opened accession negotiations with Bulgaria, Latvia, Lithuania, Malta, Romania, and Slovakia. (At the same time the EU declined to pursue in detail the long-standing application of membership from Turkey, noting concerns about the country’s human rights record.) In May 2004 the EU formally admitted ten of these European nations—all except Bulgaria and Romania—as member states. Bulgaria and Romania became EU member states in 2007.

B

The EU and Non-European Nations

Relations between the EU and the non-European industrialized countries, especially the United States and Japan, have been both rewarding and frustrating. The EU follows a protectionist policy, especially with respect to agriculture, which on occasion has led the United States in particular to adopt retaliatory measures. In general, however, relations have been positive. The United States and Japan are the largest markets outside Europe for EU products and are also the largest non-European suppliers.

The EU has been less protectionist when dealing with developing countries, which receive more than one-third of its exports. By the mid-1990s all underdeveloped countries could export industrial products to EU nations duty free; many agricultural products that competed directly with those of the EU could also enter duty free. In addition, the EU has reached special agreements with many countries in Africa, the Caribbean, and the Pacific (the so-called ACP countries). In 1963 it signed a convention in Yaoundé, Cameroon, offering commercial, technical, and financial cooperation to 18 African countries, mostly former French and Belgian colonies. In 1975 it signed a convention in Lomé, Togo, with 46 ACP countries, granting them free access to the EU for virtually all of their products, as well as providing industrial and financial aid. The Lomé convention was renewed and extended to a total of 58 countries in 1979; to 65 in 1984; and to 69 in 1989. In 2000 the Lomé convention was superseded by the Cotonou Agreement, which provides a more wide-ranging and longer-term basis for the EU’s relationship with ACP countries. The EU has concluded similar agreements with all the Mediterranean states except Libya, as well as other countries in Latin America and Asia.

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VI

The Future of the European Union

The EU has come a long way since 1951. Its membership has grown to include most of Western Europe and it is poised to absorb much of Eastern Europe as well. It has developed a common body of law, common policies and practices, and a great deal of cooperation among its members. Its progress, however, has been uneven, with spurts of activity separated by dormant periods. After vigorous activity in the 1960s, it was not until the mid-1980s that the EU moved decisively to greater integration. In the 1990s concerns about the economic climate and evidence of popular disenchantment with the EU led to a slowdown in innovation. Both the Amsterdam and Nice treaties emphasized consolidation rather than addressing outstanding issues.

This erratic progress is in part due to two unresolved conflicts within the EU. The first is whether to give priority to “deepening” or “widening,” that is, whether to concentrate upon integrating the existing members further, or to welcome new members so that all can have an input into the kind of Europe they want. The second is the conflict between supranationalism and intergovernmentalism. Despite broad acceptance of the supranational principle, national governments have been reluctant to cede control over all policy areas to EU institutions. The development of three distinct EU pillars reflects this reality: Member states have declined to yield national control to supranational institutions over politically sensitive areas such as foreign policy and judicial affairs.

One of the most immediate challenges facing the EU is to secure the long-term success of the euro, an outcome that rests in part upon how acceptable it proves to world financial institutions and markets. Enlarging the EU by including Eastern Europe should, over time, improve economic prospects by extending the single market and stimulating economic growth and trade. The EU hopes that enlargement will raise the EU’s standing as the major European voice in world affairs and contribute to security and stability throughout Europe.

It has proven difficult, however, for the EU and its member states to forge a united position on the future of EU finances and structures after enlargement. Under existing criteria, the bulk of funds dispersed under the CAP to support agriculture—by far the largest element of EU spending—will have to be transferred to the new member states. This has alarmed poorer member states accustomed to receiving these funds, while richer members are reluctant to provide more CAP funding.

The budget issue and enlargement also present problems for the structure of the EU. They raise questions about the nature of the European Commission, how nations should be represented on the commission, and the extent of the commission’s authority and responsibility. As the power of the EU has grown, the organization has drawn criticism for being undemocratic, since the European Parliament has no real powers or control over decisions. Furthermore, the decision-making bodies, especially the commission, are not subject to any democratic check.

Uncertainties about the future of the EU are underlined by concerns among member states over the potential loss of their ability to act independently. A reluctance to cede national authority has been most pronounced in security policy. The EU failed to present a coherent front in either the Persian Gulf War or the former Yugoslavia when required to move from a common policy position to a common action. The desire of some countries to build a common defense policy is resisted by others that insist that at best a European defense force can only be supportive of and subordinated to NATO.

The EU’s decision to welcome 10 new member states in 2004 raised many questions about integration. In June 2004 the EU member states agreed to the final text of the first EU constitution, which was primarily developed to streamline EU institutions and facilitate enlargement. The final text was the result of more than two years of draft negotiations. Built on the founding treaties of the EU, the constitution further defined the roles and powers of EU institutions, such as the European Parliament. Ratification of the constitution required approval by all 25 member states (including the 10 new members), either by popular referendum or by parliamentary vote, by November 2006.

In May 2005, however, voters in France and Netherlands resoundingly rejected the proposed EU constitution, plunging the EU into its worst political crisis in decades. Soon thereafter several EU member states announced they would postpone their own votes on the constitution. At the EU summit meeting in June, EU leaders abandoned their plan to ratify the constitution by the November 2006 target date. EU president Jean-Claude Juncker described the proposed constitution as “no longer tenable” and called for a “period of reflection.” The summit also exposed deep rifts in the EU over economic integration. Budget talks broke down after leaders failed to resolve a bitter dispute that primarily involved Britain and France. Britain’s insistence on a reform of the CAP, which sets farm subsidies, was strongly opposed by France.

At the 2007 EU summit, however, the 27 member nations agreed on a treaty with governing rules for the organization that would replace the defunct constitution. The treaty created the position of president of the European Union and a stronger head of foreign policy to represent the EU on the international stage. It also sought to ease EU decision-making by requiring majority, rather than unanimous, approval of many policy decisions. European leaders signed the treaty in Lisbon, Portugal, in December 2007. Only Ireland planned to hold a popular vote on the treaty. Other EU members sought parliamentary ratification.

The difficulties surrounding the constitution raised further questions about what the EU is and what it wants to achieve. For almost all its life span, European integration has resulted from elite initiatives and agreements that did not involve national electorates. In the 1990s, however, the picture changed because of the single market, demands for more harmonization, and the Maastricht Treaty. Popular discontent with elite decisions increased, indicating that electorates could no longer be taken for granted. Almost all EU activity has focused on building the equivalent of a state encompassing much of Europe. Yet little effort has focused on how to create a European nation with a strong bond of identity across national borders, making European citizens feel they have much, including a future, in common. The effort to forge a European identity was expected to pose a major challenge in the 21st century.

Despite these challenges, the EU is unlikely to disappear. It has become a fact of life, with the countries enmeshed together in a host of cooperative practices. The EU has had great success in developing a culture of collaboration, and it occupies a place at the center of Europe. What is at issue is not its survival, but its form as it leads Europe in the 21st century.