After a Busy August, Time to Get to Work
After an August of so many crises and so little time, September promises to be a busy one in both the US and EU. Europe has a newly-elected president of the European Council and a new High Representative for Foreign Affairs in Donald Tusk and Federica Mogherini (pictured to the left), respectively. They take office just as the geopolitical situation continues to deteriorate in Ukraine and the Middle East. Then there are the disappointing economic numbers coming out of seemingly every European country, putting serious pressure on Mario Draghi and the European Central Bank to act. NATO’s leaders are gathered this week in Wales for what seems to be the most important Summit in decades for the transatlantic alliance. Demonstrating a united transatlantic front will be essential in the face of ongoing pressure from Russia and ISIS.
On the trade front, TPP ministers are meeting this week in Hanoi trying to make enough progress to fulfill President Obama’s stated goal of reaching an agreement in principle by the end of the year. Finally, the next TTIP round at the end of the month will be crucial; it will be important to demonstrate positive momentum heading into the US midterm elections. With any luck, Congressional debate and ultimate approval on trade promotion authority will follow soon after the elections.
In short, it’s time to get back to work in Washington and Brussels.
News
Kramer on What to Expect at the NATO Summit
Franklin Kramer of the Atlantic Council’s Brent Scowcroft Center on International Security joins Defense News as part of a panel of experts to discuss what issues are likely to top the agenda at this week’s NATO Summit in Wales. The panelists touch upon the situation in Ukraine, Syria’s civil war, the Iraq crisis and underlines the severity of the many crises the alliance’s leaders will have to deal with. (Atlantic Council)
Le Pen Faces Defeat over TTIP Transparency Resolution
Despite widespread support for increased transparency of TTIP negotiations, a motion calling for the publication of negotiation texts filed by Marine le Pen, an MEP and leader of France’s far-right Front National, is expected to fail. This indicates that despite their large gains across Europe in the elections, no one is interested to give far-right parties a political platform, even on issues where the mainstream MEPs might tend to agree with them. The failure of the FN to form a parliamentary political group and the party’s lack of support by traditional parties will continue to isolate the far-right, making it increasingly difficult for them to influence policymaking.
The article also notes that the International Trade Committee of the Parliament is due to discuss TTIP tomorrow (September 3). (Euractiv)
German Business Attacks ‘Complacent’ Berlin
Following the German government’s introduction of a minimum wage and its reduction of the retirement age to 63, German business leaders have criticized their government for focusing too much on wealth distribution instead of competitiveness. Rather than being complacent and overconfident about their comparatively good economic performance in the Eurozone, the German government should be more growth-oriented and business-friendly, in recognition of the fact that their export-driven economy is not immune to external shocks such as from Ukraine. (Financial Times)
Polish Premier and Italian Foreign Minister Win Top EU Jobs
After several hours of negotiation between heads of state and government in Brussels last weekend, Polish Prime Minister Donald Tusk and Italian Foreign Minister Federica Mogherini have been appointed to top European Union positions. Mr. Tusk will replace Herman Van Rompuy as European Council president on December 1 for a two and a half year mandate. Ms. Mogherini was appointed the new foreign policy chief and vice president of the Commission, succeeding Catherine Ashton for a five year term. (Wall Street Journal)
Recent Analysis
More Integration is still the Right Goal for Europe
In their Financial Times opinion piece, Wolfgang Schäuble and Karl Lamers discuss the history of EU integration, from an economic union, to a monetary union, towards a political union. They suggest that the European Union should focus their policies on a fair and open internal market, freer international trade, especially with the United States, currency and financial markets, climate, environment and energy, and foreign and security policy. Where national or local authorities are better placed to legislate, powers should return from Brussels to inspire greater democratic legitimacy. (Financial Times)
The EU: Back to Work
This article published in the Economist, gives an extensive overview over the discussions at the European Union Summit last Saturday, where European leaders talked about how to respond to the situation between Russia and the Ukraine, and filled two senior leadership positions. The author compares the newly appointed candidates with their predecessors and ponders on their future policy directions and decisions, emphasizing that concluding TTIP and keeping Britain in the European Union should be among their top priorities. (Economist)
Six Things to Know about the EU’s Decision on Top Jobs
Following the recent appointment of Donald Tusk as president of the European Council and Federica Mogherini as foreign policy chief, Tim King offers two observations on the present state of EU politics, two reflections on the past, and two predictions for the future. He ponders on the decision to appoint Tusk and Mogherini, describing their appointment as a trade-off, which might balance the politics of right and left, eastern and western Europe, north and south, but one that could also fail terribly. Taking office in times of economic crises, important foreign policy crises, and an increasingly anti- European United Kingdom, the two assume their new roles at a pivotal moment in the Union’s history. (European Voice)
Donald Tusk: A Champion for Eastern Europe in a Leading Role at EU
While Tusk’s appointment creates a power vacuum for his center-right party in Poland, his appointment should be considered a marker of great progress for the Eastern European members of the Union. Well-known on the international stage for successfully leading Poland through the economic crisis, and a close ally to Angela Merkel, it remains to be seen if he manages to upload his political success from the national to the European level. (Wall Street Journal)
Draghi Approaches his Abenomics Moment
Stephanie Flanders, chief market strategist for Europe at JPMorgan Asset Management, addresses European Central Bank President Mario Draghi’s speech at Jackson Hole last month, in which he has talked about the importance of a more growth-friendly monetary policy for the Eurozone. The author argues that Draghi’s suggestions indicate the creation of Japanese-style Abenomics for the European Union. However, large scale quantitative easing is neither sustainable nor the ultimate solution to the Euro’s problems. Still, she agrees with Draghi that the risk of doing too little are bigger than the risk of doing too much. Europe needs growth to carry out much-needed structural reforms, and the ECB should not have to do it alone. (Financial Times)
Germany: In a Spin
In his analysis, author Stefan Wagstyl talks about the implications of the German economy’s slow growth and its repercussions well beyond its borders. Although Germany’s export-oriented economy has long been a model for the rest of Europe and is still faring comparatively well, the crisis in Ukraine as well as competitive threats looming from both the Chinese and American economy have concealed long-term vulnerabilities that threaten to harm Germany’s future potential. The author suggests higher public and private investment, especially in infrastructure, to boost the German economy. (Financial Times)
NATO Wales is likely to be a Historic Summit
In advance of this week’s NATO Summit, Adrian Masters explains why this meeting is expected to be crucial for NATO and have wide-ranging implications for the nature and future credibility of the alliance. He claims that NATO is at a tipping point and needs to adapt to the challenges it is currently facing, to ensure a future joint defense of its members. Otherwise, the alliance risks fading towards irrelevance. (ITV Wales)
War in Europe is not a Hysterical Idea
In an attempt to describe the current situation in Ukraine, columnist Anne Applebaum compares it to the pre-war situation of 1939, drawing comparisons between Hitler’s and Putin’s foreign policy. She puts forward the little known fact that Russian troops have recently marched across the Ukrainian border, holding a flag of “Novorossiya,” a country invented by Putin and his supporters that is supposed to be set up on the land that he soon hopes to conquer. With these developments in mind, the author poses the question, is it hysterical for NATO to prepare for total war-or naive not to do so? (Washington Post)
Blog: The Reality of Precaution in the US and EU
This article by Borderlex summarizes the findings of a short paper comparing the American to the European approach to regulation of health and environmental risks by the think tank Notre Europe-Jacques Delors Institute. The paper finds that–contrary to public perception, American and European regulations do not significantly differ. With the paper finding that “The USA often takes a precautionary approach without formally endorsing the precautionary principle while Europe formally endorses precautionary principle without applying precaution to every risk”, the precautionary principle should not be a dividing line in TTIP negotiations. Moreover, the authors find dozens of instances where US regulations go above and beyond their European counterparts, disproving the notion that Europe is always more-highly regulated. (Borderlex)
Read the full paper entitled, “The reality of precaution: comparative analysis EU–USA” here.
Why President Obama’s Visit to Estonia Really Matters
Erik Brattberg, resident fellow at the Atlantic Council, talks about the symbolic value of Obama’s visit to Estonia before the NATO Summit. He believes it is imperative for Obama to praise Estonia, Latvia and Lithuania for their economic and democratic developments and offer them unambiguous future support for their security. Only by showing passion and promising a credible future security commitment for Eastern Europe, will the three countries will continue to regard democracy and a liberal economy as a viable alternative to “Putinism”, and could serve as a bulwark against potential Russian aggressions. In addition, the author hopes that Obamas visit to Eastern Europe might also dampen Putin’s confidence to influence the region in the future (Huffington Post)
The US Dollar Will Achieve Parity with Euro by 2017, Says Goldman
Analysts from the Goldman Sachs Group are convinced that the US dollar will achieve parity with the Euro by 2017. The discussion was sparked by a drop in value of the Euro by 5.75% since March. Goldman’s predictions are further encouraged by higher US interest rates which will continue to cause investors to move money from Europe to the US as it increases returns on assets denominated in the currency. Meanwhile, if European Central Bank President Mario Draghi embarks on a robust round of quantitative easing in an attempt to jumpstart the sluggish European economy, the currency would continue to fall. (Wall Street Journal)
Upcoming Events
Seventh Round of TTIP Negotiations – September 29 – October 3 in Washington DC – a political stock-taking between Ambassador Froman and Commissioner De Gucht will follow the talks on October 13.
EU Policy Agenda for Social Enterprise: What Next? – September 3 in Brussels; hosted by the European Economic and Social Committee – More Information
Launch of the Memos to the new EU Leadership – September 4 in Brussels; hosted by Bruegel – More Information
The EU-US Transatlantic Trade and Investment Partnership-TTIP – September 8 in Copenhagen, Denmark; hosted by the British Chamber of Commerce In Denmark – More Information
Resolving Cross-Border Internet Policy Conflicts – September 9 in Washington DC; hosted by the Information Technology and Innovation Foundation – More Information
Discover Global Markets: Free Trade Agreement Countries – September 9 -10 in Detroit, MI, hosted by the US Commercial Service – More Information
Jobs and Economic Growth for Atlanta: How TTIP Will Help – September 10 in Atlanta, GA; hosted by the Trans-Atlantic Business Council – More Information
The Global Innovation Economy and American Competitiveness – September 17 in Washington DC: hosted by the Information Technology and Innovation Foundation – More Information
TTIP Road Show, Edinburgh, Scotland: The US-EU Trade Negotiations and the Coalition for Transatlantic Business – September 23 in Edinburgh, Scotland; hosted by British American Business – More Information
Breakfast Briefing on the European Banking Union – September 23 in New York, NY; hosted by the European-American Chamber of Commerce – More Information
Jobs and Economic Growth for Indianapolis: How TTIP Will Help – September 26 in Indianapolis, IN; hosted by the Trans-Atlantic Business Council – More Information
Launch of new Atlantic Council Publication on TTIP’s Benefits for Small and Medium-sized Enterprises – October 9 – More Information forthcoming