European Foundation Intelligence Digest, 18th

Lithuania votes to join Evropeiskii Soyuz

The Lithuanian electoral authorities reported that 91% voted in favour of joining the EU in a two-day referendum held on 10^th and 11^th May. This apparently ringing endorsement of the Eastward march of the EU was warmly welcomed in chancelleries across the continent. But the 90% figure seems suspiciously high, especially since it was based on a 67% turnout which was due to a last-minute surge of votes cast on the second day of voting which caused the turnout to be over the required 50%. By the end of voting on 10^th May, only 30.6% of the electorate had voted, including 7.6% by postal vote. In other words, only 23% had actually gone to vote on the first day. After this disappointing turnout on the first day, President Rolandas Paksas said that “measures might be taken on Sunday to prevent a flop”. On Saturday, indeed, special buses were operating in the Lithuanian capital, Vilnius, to take voters to polling stations. [Brian Bradley, Reuters, 10^th May 2003] Government officials were said to be near panic behind closed doors. [Bryan Bradley, Reuters, 11^th May 2003] By 10 a.m. on the next day, i.e. four hours after the polling stations had opened at 6 o’clock in the morning, Reuters reported that the turnout had jumped to 27.8%, i.e. that a further 4.8% of the Lithuanian electorate had voted first thing on Sunday morning. [Reuters, 11^th May 2003] Another 17.8% had been added to the turnout 4 hours later, by 2.49 p.m. local time. This is nearly as many as had voted during the whole of Saturday. The pro-European government of Lithuania immediately started to celebrate, even though it could not know that the people who had voted had voted Yes. [Michael Tarm, Associated Press, 11^th May 2003] The line was peddled that voters had rushed to cast their ballots for Europe when they realised how low the turnout had been on Saturday, but observers from the British Helsinki Human Rights Group, which has observed elections in post-communist Europe since 1993, point out that the previous president, Valdas Adamkus, lost last December’s presidential elections, even though – or because? - his electoral platform was based mainly on the fact that he had got Lithuania into the EU and NATO. BHHRG observers have found little or no enthusiasm on the ground in Lithuania for EU membership. [See the BHHRG report, “Lithuania’s Winter of Discontent”, http://www.oscewatch.org/CountryReport.asp?CountryID=57&ReportID=190] So why the sudden surge of enthusiasm? It is claimed that the Catholic church played a role in exhorting the faithful to go and vote after Sunday Mass, but the clergy has been urging a Yes vote for a long time, and in any case it is a Western fantasy to believe that there are Catholic churches in every village, or that church attendance is anything but fitful in this post-Soviet society. Moreover, Lithuanian society is characterised by a very high degree of apathy towards, and mistrust of, politics, and it is difficult to see Lithuanians believing the latest promise that everything will suddenly get better in the EU, especially since much of the economic pain the country has suffered comes from the twin burdens of the acquis and agricultural dumping as part of the accession procedure. What little enthusiasm there is, exists mainly because people want EU membership so that they can leave their country and go and work abroad. But faced with a classic Soviet exhortation for “the people” to support an initiative of the whole political class, and faced with the president’s sinister reference on the Saturday to “measures” which would have to be taken, one cannot help feeling that it was old Soviet habits, and perhaps even Soviet methods, which led to this astonishing result. [See British Helsinki Human Rights Group, http://www.oscewatch.org/LatestNews.asp?ArticleID=20]

Germany cannot balance budget

Both the German Chancellor and Finance Minister have admitted that their country’s stated aim of balancing the budget by 2006 has been abandoned. The opposition immediately demanded the resignation of the Finance Minister, Hans Eichel, because balancing the budget had been part of the government’s programme. These demands were rejected, even though the government’s plan to balance the budget is in tatters: there is now expected to be a tax shortfall of at least 50 billion euros, if not twice that amount. There would now have to be yearly growth of 4.5% for the books to be balanced by 2006. Eichel admitted that the government would have to borrow 35 billion euros more this year than had been initially planned. It is already clear that Germany has overshot the euro stability rules for 2002 and probably in 2003 and even 2004. Eichel refused to rule out tax hikes. [Die Welt, 12^th May 2003] The EU monetary commissar, Pedro Solbes, has reportedly said that he fears the collapse of the whole stability pact if Germany breaks the rules systematically. [Handelsblatt, 12^th May 2003]

Dutch economy in recession

The Netherlands has formally entered recession. GDP fell by 0.3% in the first quarter of 2003, following a contraction of 0.2% in the last quarter of 2002. “Recession” means economic contraction for two consecutive quarters. Investment has fallen by 6% and household consumption grew by a meagre 0.3% in the first quarter of this year, the smallest increase since 1994. Exports rose by 1.3% and imports by 3.5% but these increases are mainly due to an increase in goods transiting through the country. The government proposes to deal with this economic gloom in one of Europe’s strongest economies by cutting state spending by €15 billion. [Agence France Presse, 15^th May 2003]

Schröder: Fischer should be EU foreign minister

The German Chancellor has said that he thinks that Joschka Fischer, the current German Foreign Minister, would be an excellent candidate for the post of EU foreign minister, even though the European Constitution has not even yet created that post. He said that if Fischer did leave for Brussels, he would weep with one eye and be happy with the other, but that that he would be sadder than happier because of Fischer’s qualities in Germany. The Chancellor said that he should not selfishly seek such a job for himself, because Fischer’s devotion to the European idea was such that he was the perfect man for the job. [Die Welt, 12^th May 2003] It seems that other members of the European Convention, and other people in Europe, agree that Fischer would be an excellent choice. The French government has supported Fischer’s candidacy for the as yet non-existent job. “He would be an excellent European foreign minister,” said a spokesman for the French foreign minister, Dominique de Villepin, “because he has notable qualities and capabilities. The French Europe minister, Noelle Lenoir, expressed the same approval of the idea. Support has also come from Jean-Claude Juncker, the prime minister of Luxembourg. Smaller states, however, see the emergence of Fischer’s candidacy before the job has even been created as confirmation of their fears that the European constitution will lead to a stitch-up of power by the big states. The Greek foreign minister, Georgios Papandreou, said, “It is far too early (for such a decision)”, a sentiment echoed by the foreign ministers of the Czech Republic, Austria and Poland. [Handelslbatt, 13^th May 2003]

The candidate himself has said that he thinks that, in future, the president of the Commission should be chosen by a committee comprised equally of the European Parliament and the European Council. Fischer also said, in a letter to the Convention’s president, Valéry Giscard d’Estaing, that he thinks that considerable diplomatic experience is needed for the job of EU Foreign Minister, and that the EU should strengthen its military capacities. [Die Welt, 12^th May 2003] However, according to three commentators on Die Welt, there are insurmountable obstacles to Fischer’s elevation to euro-foreign minister. First, they say, Gerhard Schröder has no interest in letting Fischer go to Brussels before the next federal elections in 2006. Fischer is the best guarantor of the stability of the red-green coalition; he is also personally popular, and he lends lustre to an otherwise boring cabinet. If Fischer went to Brussels in 2004, Schröder would have to re-structure the government completely, and Fischer’s departure might even signal the end of the coalition. Secondly, some Greens are beginning to suspect that the Chancellor may be ostentatiously putting Fischer forward as a candidate precisely to destroy his chances by suggesting him too soon. The negative reactions from Greece perhaps bear this out. Thirdly, Fischer might consider that the trappings of the job are not grand enough for him: the current incumbent, Javier Solana, has no staff, a small budget and “does not even have his own aeroplane”. Fischer would want a proper EU foreign ministry to run. Even if Fischer succeeded Solana in 2004, when a new Commission would be appointed, he would not have the new super-job until it is created in 2006. Finally, it is not even clear what the powers of the new EU foreign minister will be, especially since the powers of the new EU president (if there is one) have not been decided either. If a president were created along the lines Giscard proposes, then he would inevitably have the decisive role in EU foreign policy, just as the constitution of the 5^th Republic in France, gives the president a determining role in foreign affairs. Since Germany supports a strong presidency, Fischer is working against the powers of his own putative future. Finally, if the presidency went to someone from a big state, say Tony Blair or José-Maria Aznar, then the small states would demand the other high-profile job, that of foreign minister. The job could go to Fischer only if the presidency went to someone like Jean-Claude Juncker, the PM of Luxembourg. [Nikolaus Blome, Stephan Haselberger, Andreas Middel, Die Welt, 14^th May 2003]

Prodi v. Giscard

The president of the European Convention, Valéry Giscard d’Estaing, and the president of the European Commission, Romano Prodi, are engaged in a personal duel over the future institutional structure of the EU. This week, the 105 members of the Commission are to start debating the draft constitution which Giscard produced at the end of April. 1,500 amendments have already been put down. The greatest resistance is to the suggested Article 16a, which many of Giscard’s enemies refer to as “a coup d’état”: it proposes replacing the current system of 6-month rotating presidencies with a new president who would be elected for a 2 ½ year term, renewable once. It was this suggestion which Romano Prodi’s Commission denounced as “contrary to common sense” and Giscard’s other enemies see it as a deliberate attempt to weaken, sabotage even, the power of the European Commission. The smaller countries see the idea as an attempt by the larger EU states to grab even more power for themselves, since the Commission’s technocratic role tends to favour and protect the smaller states against political interference by bigger ones. The three Benelux countries, Austria, Finland and seven candidate countries have all made the same proposal to remove the proposed Article 16a altogether. The German representative, Joschka Fischer, is proposing to change the name of the office from Giscard’s proposed “president” to the more emollient “chairman”, an apparent compromise which is all the more likely to be accepted since the two words are the same in French anyway. [Süddeutsche Zeitung, 12^th May 2003]

Only a few weeks now remain for the Convention to conclude its work and, as ever in the EU process, the most important issues have been left until the end. Giscard is due to present his draft constitution to the European Council which meets in Thessaloniki on 20^th and 21^st June. The Convention might do one of three things. It might take the initiative and present a coherent report. It might be divided and leave the choices for the governments to take. Or it might agree on a minimalist proposal, a meagre result for the 105 people who have supposedly been working on a radiant future for Europe for the last year or so. Among the countries, there are basically three camps. There are partisans of the status quo, including many of the candidate countries, who are particularly opposed to the idea that they might, in future, not have a Commissar of their own. They are generally opposed to the idea of a European presidency, which they think will be controlled by the big states. Then there are federalist interests, represented by Belgium, certain sections of the European Parliament and the European Commission. Meanwhile, the big states are in favour of the idea of a European president. Other variants include the idea of merging the president of the Council and the president of the Commission so that there is only one chief executive of Europe. Romano Prodi is said to be in favour of this idea. [Arnaud Leparmentier, Le Monde, 6^th May 2003]

Valéry Giscard d’Estaing on Wednesday deepened his row with Romano Prodi by rejecting the latter’s call to organise a public debate in Brussels with the Convention on the reform of the EU institutions, saying that the meeting should instead take place in Stuttgart. Giscard had suggested that Prodi debate publicly with him. The row highlights the increasing nervousness of the European Commission, which fears that its wings are going to be seriously clipped if Giscard gets his way. Acrimonious letters have therefore been exchanged between Prodi and Giscard. One of the reasons for the Commission’s weakness is that it has only a small representation on the presidium and in the Convention itself. Hans Gert Pöttering, the head of the EPP group in the European Parliament, has expressed support for the idea, originally suggested by the French commissar, Michel Barnier, that the two posts, that of president of the Commission and president of the Council (“president of Europe”) should be fused into one and the same chief executive. On Wednesday, relations had grown so frosty that the Transport commissar, Loyola de Palacio, refused to enter a meeting of the European Council unless six seats were reserved for the Commission: the Council secretariat had suggested three seats to accommodate EU enlargement. “We are not a simple delegation in addition to the delegations of member states,” said Mrs de Palacio proudly, “we are an institution which can be compared only to the presidency.” [Philippe Gélie, Le Figaro, 15^th May 2003]

Raffarin wants referendum on Euro Constitution

The French prime minister, Jean-Pierre Raffarin, has said that he wants to put the forthcoming European Constitution to a referendum in France. He launched the idea on “Europe day”, 9^th May, saying in a TV interview, “The Europe which we are building must be based on the states and on citizens. Citizens must appropriate the European project for themselves.” He gave a garden party for young people with “a European buffet” (whatever that is) and tried to adopt an emollient tone towards the prospect of Eastward enlargement. Jacques Chirac had famously lashed out at the candidate countries after they publicly supported the Anglo-American position over Iraq. Raffarin said that one could not expect candidate countries to behave like countries which had been in the EU for a long time, and he said that the EU had to extend its hand to them to welcome them into the European project. The prime minister also said that he attached great importance to the Franco-German relationship. He announced the appointment of a young German, Christoph Gottschalk, president of the Franco-German youth parliament, as a member of his cabinet (private office). This appointment comes after the decision to create secretary-generalships for Franco-German coordination in France and Germany, a decision taken after the Franco-German summit on the occasion of the 40^th anniversary of the Elysée Treaty last January: the appointments themselves will be made public on 10^th June. [Jean Baptiste de Montvalon et Henri de Bresson, Le Monde, 11^th May 2003]

Euro steams ahead

The euro has bounded back from its previous weak showing against the dollar and is currently trading very close to the level it was at when it was launched at the beginning of 1999. The strength of the euro and the weakness of the dollar were boosted by remarks made by the US Treasury Secretary, John Snow, who said on TV that a low dollar was good for US exports. The markets immediately assumed that the Americans wanted a lower dollar in order to stimulate growth and job creation in time for the elections. One analyst said he thought the Bush government wanted a controlled devaluation of the dollar, but that if they said this out loud then the American currency would collapse. Dealers were saying that the next hurdle for the euro will be the $1.1745 mark. If it passes that, it could go to $1.20. It seems that all the gloom surrounding the European economy, even Germany’s economic woes, has been dispelled by the even greater worries about the US economy. [Handelsblatt, 12^th May 2003]

US might attack Belgium

Belgium’s pretence to exercise jurisdiction over the whole world continues to cause ructions. The head of the US army in Iraq, General Tommy Franks, was on Wednesday accused of crimes against humanity before a Belgian court. He joins Dick Cheney, George Bush Senior, Colin Powell, Norman Schwarzkopf, Ariel Sharon and Fidel Castro, among other luminaries in the hypothetical dock. The Israelis and the Americans have reacted furiously against the indictment of their respective leaders; the previous Israeli ambassador was recalled to Tel Aviv for consultations. The then foreign minister, Benjamin Netanyahu, called the act “an anti-Semitic decision”, and he said that Israel had seriously considered breaking off diplomatic relations. That has not occurred, but the Sharon case is to be examined again on 27^th May, despite the attempts by the Belgian government to amend the law to prevent the charges from going ahead. The Americans, for their part, have signalled their displeasure by threatening to veto the opening of the new NATO HQ in Evere, outside Brussels, and even to move NATO to another country. The Belgian political class is riven in two: those who are trying to limit the applicability of the law, and those who are trying to keep it as it is. The attempts by the government to fiddle around with the retroactivity clause has led to the situation in which, for technical reasons, George Bush Sr. is let off the hook but not Ariel Sharon. This has infuriated the Israelis even more, who accuse the government of helping the Americans but not them. Meanwhile, in Washington, a Democrat Representative has put down a bill for a “Universal Jurisdiction Act” which proposes to liberate by force any American citizen detained by the Belgian authorities. In other words, the US would declare war on Belgium if it exercised its jurisdiction against an American. [Philippe Gélie, Le Figaro, 12^th May 2003]

Italian police arrest traffickers in babies

The authorities in the Southern Italian town of Foggia have uncovered a criminal network which sells newly-born babies for hundreds of thousands of euros. It is suspected that they are sold for their organs and/or for prostitution. The carabinieri have arrested a Ukrainian woman who is believed to be the head of the ring, based in Naples. Two other women and a man have been detained. The police arrested the four in flagrante delicto as an undercover agent prepared to pay €350,000 for a baby boy. The procurator has said that the ring was essentially “a supermarket” which smuggled drugs, prostitutes and babies. The mother of the newly born baby was also taken into custody; it is suspected that women trafficked and held captive as prostitutes have their newly-born children taken away from them so that they can be sold. [La Repubblica, 12^th May 2003]