Angela Merkel - EU - Nicolas Sarkozy

EU leaders face tough agenda at Brussels summit

Thursday 11 December 2008

At an EU summit in Brussels - the last of the French EU presidency - leaders of the 27-member bloc face a challenging agenda that includes a climate package, an economic stimulus plan and the controversial Lisbon Treaty.

Sarkozy heads his last European Council on December 11 and 12. If he reaches an agreement with his 26 partners over three issues, the revival of the economy, climate change and the Lisbon Treaty, this would be a great victory for the French, who will then hand over to the Czechs, known to be more eurosceptic. An agreement, however, seems far off, while the traditional Franco-German axis is hardly in top form. In the run-up to the Brussels summit, Sarkozy went knocking on his neighbours’ doors to rally their support.

The Lisbon Treaty: the Irish deadlock and the Czech blockage

Ratification of the Lisbon Treaty has been on hold ever since 53% of Irish voters rejected it on June 12. France was one of the architects of this “simplified treaty”, conceived after the European constitution was spectacularly turned down in France and the Netherlands.

Caroline de Camaret, European specialist at FRANCE 24, explains that if no solution is found at Brussels, “we will go on with the Nice treaty, which set up a heavy machinery that is not adapted to a 27-member-state union. Under the Nice treaty, the EU presidency is weak and is incapable of resolving economic and international crises.”

The French presidency is hoping to present a road-map in Brussels to pull the EU out of its institutional paralysis and encourage the Irish to approve the treaty, while giving them certain guaranties. Sarkozy hopes to come back from Brussels with a new referendum, and even better, a timetable for its organisation in 2009.

The Czech Republic is the only other member that has not ratified the treaty, and it now holds the rotating EU presidency. The Czech Constitutional Court has approved the process of ratification by parliament. However, on November 25, the eurosceptic Czech President Vaclav Klaus threatened not to sign the treaty once parliament approves it until Ireland does the same. Polish President Lech Kaczynski holds the same stance and baulks at signing the treaty though it has been approved by Polish MPs.

Overall, 25 countries have ratified the Lisbon Treaty, which requires the unanimous approval of the EU’s 27 members before coming into effect. If the Irish and the Czech finally give their official nod, the treaty will be effective as early as 2010.

In Brussels, Sarkozy will press the 26 other member states to approve the 200 billion euro economic stimulus plan proposed by the European Commission on November 26. Nothing, however, is guaranteed to happen. Currently, everyone is responding to the economic crisis at a national level. Several countries have expressed their reluctance to a pan-European plan because they do not have the funds (i.e. Hungary, Poland, Ireland, Greece…). It’s Germany, however, who is slamming on the brakes.

As Europe’s economic powerhouse, Germany is not prepared to foot the bill – as others hoped – because its books are balanced. On November 26, German Chancellor Angela Merkel warned against an EU stimulus race.

Paris, London and Brussels have since been maneuvering to convince Germany to contribute to the package. On December 8, four days before the European Council, Sarkozy hosted a mini-summit on the coordination of the European economic plans in London. He was flanked by British PM Gordon Brown and the president of the European Commission, José Manuel Barroso. Angela Merkel’s absence was glaring and she was on everybody’s lips. “There is no disagreement” with Germany, insisted Sarkozy.

“However, will the European stimulus plan be adopted as it is and will it be enough?” asks de Camaret, adding that several experts have already pointed out that the plan is less ambitious that its US counterparts.

Poland and Italy threaten to veto the EU climate pact

The European climate change package is designed to step up Europe’s efforts to reduce global warming. An agreement in this field would be a real success for Sarkozy. A dozen member states, however, are threatening to mount a united front against the plan. They fear that the “energy-climate package” will be too expensive and will threaten the competiveness of their industries.

This plan aims at cutting greenhouse gas emissions by 20%, overall energy consumption by 20% and boost renewable energies to make up 20% of EU energy consumption. The main bone of discontent between the 27 member states is the auctioning of carbon quotas planned for 2013. Those who pollute will have to pay – a problem for eastern European countries heavily dependent on coal.

The French presidency has pushed negotiations to the very last moment. On December 6, it met with the leaders of nine reluctant countries, Poland, Bulgaria, Hungary, Romania, Czech Republic, Slovakia, Estonia, Lithuania and Latvia, in Gdansk, Poland. They want their dependence on coal to be taken into account in these times of economic turmoil.

The French presidency could grant Poland, one of Europe greatest polluters, and other countries, special dispensations. These countries might be granted special treatment until 2016 and obtain free pollution quotas for their coal power stations.

However, two European heavyweights, Germany and Italy, are also threatening to oppose the climate plan. Germany wants to protect its industry which is badly hit by the financial crisis. In an interview with the German tabloid Bild, three days before the European council meeting, Merkel warned that she would “watch out” that the EU does not take “measures that would threaten German jobs or investments.”

The climate change package needs the approval of all 27 states to go through – a real challenge for Sarkozy.