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241. How the EU can – and should – enhance its security and global competitiveness

Author:
Stefania Benaglia, Steven Blockmans, Michael Emerson, Tinatin Akhvlediani, Ceren Ergenc, and Fanny Sauvignon
Publication Date:
09-2024
Content Type:
Special Report
Institution:
Centre for European Policy Studies (CEPS)
Abstract:
To achieve the objectives of security and competitiveness the EU will absolutely need to prioritise its enlargement policy, defence strategy and global partnerships over the coming years to 2030 and beyond. To make the EU fit for 30+ members, it will have to start by reforming its enlargement methodology towards a ‘staged accession’ procedure and move towards more qualified majority voting, alongside adapting its budget to accommodate new members. Accession negotiations will need to have ironclad security commitments and the EU should assist candidates in shoring up their own defences, as well as beefing up its own Member States’ military capacities. The EU also has no choice but to become a security provider for the entire continent. To strengthen its overall global competitiveness, the EU should boost Europe’s defence industry, ramp up the production of much-needed capabilities, tackle procurement issues and harmonise technical and operational standards. Collaboration with regional partners through the Global Gateway is also important but the EU shouldn’t position itself as an exclusive alternative to China’s Belt and Road Initiative. It must also actively engage all parties in the Middle East peace process to counterbalance China’s influence and (re)assert itself as a key regional player. The India-Middle East-Europe Economic Corridor (IMEC) will test the EU’s ability to maintain its global relevance and uphold its values.
Topic:
Security, Foreign Policy, Defense Policy, European Union, Competition, and Enlargement
Political Geography:
Europe

242. The Impact of Ukraine’s Accession on the EU’s Economy

Author:
Tinatin Akhvlediani and Veronika Movchan
Publication Date:
03-2024
Content Type:
Special Report
Institution:
Centre for European Policy Studies (CEPS)
Abstract:
The groundwork for Ukraine’s integration into the EU’s single market was laid by the EU-Ukraine Association Agreement (AA). A key component of the AA, the Deep and Comprehensive Free Trade Area (DCFTA), paved the way for Ukraine’s gradual integration into the EU’s single market. Building on the DCFTA, Ukraine’s integration into the EU’s economy has significantly advanced since February 2022. In response to the invasion, the EU swiftly and temporarily but completely liberalised its market for Ukrainian goods through Autonomous Trade Measures (ATMs) and triggered the Temporary Protection Directive that has enabled over 4 million Ukrainian refugees to reside and work in the EU. With a continued swift trajectory, Ukraine’s integration is set to be much more comprehensive by the (yet unknown) time of accession. As this study outlines, the prospect of Ukraine’s accession to the EU brings some challenges but holds immense potential for mutual economic benefit. Free movement of goods. Full access under the ATM has not caused drastic changes in the EU’s imports or in the functioning of the single market in general. Yet, to avoid disruptions in the future, the accession treaty could include transition periods for full market access for Ukrainian goods in those EU Member States that may be vulnerable to a sharp increase in imports. Full trade liberalisation in services is expected to have more trade-easing effects, particularly for the EU, as it holds most of the reservations. Ukraine’s main EU partners in services trade are Germany and Poland, but services trade with Ukraine’s other major partners, including Estonia, has been steadily increasing since the implementation of the EU-Ukraine DCFTA. Thus, trade absorption capacity should be sustainable. Free movement of capital. Given the underdevelopment of Ukraine’s financial sector and capital markets, legislative and policy alignment should serve as a solid foundation for financial deepening in the country. Eased movement of capital will make it significantly easier to conduct business and trade and commercial and non-commercial payments between Ukraine and the EU. Free movement of workers. As long as Ukrainian workers fit the labour demands of the receiving EU countries, they could fill the gap in the labour supply and complement rather than replace local workers. An enlarged EU as a global supplier. Ukraine could strengthen the EU’s position in critical materials and key agricultural products, as well as contribute to the EU technologically with its emerging ICT sector and increasing skills and know-how in IT and computer services. Ukraine’s reconstruction and sustainable recovery is a significant challenge that requires substantial financial support. Yet, by addressing these considerations with foresight and diligence, Ukraine’s accession to the EU could not only elevate Ukraine’s standing but could also strengthen the EU’s position on the global stage.
Topic:
Reconstruction, European Union, Economy, Regional Integration, Trade, Recovery, and Russia-Ukraine War
Political Geography:
Europe and Ukraine

243. Maximising EU Concessional Finance for Greater Leverage and Impact: An Options Spread

Author:
Mikaela Gavas, Samuel Pleeck, Andrew Rogerson, San Bilal, and Karim Karaki
Publication Date:
03-2024
Content Type:
Policy Brief
Institution:
Center for Global Development (CGD)
Abstract:
Already constrained by the economic aftershocks of COVID-19, the impact of the war in Ukraine, and the food and climate crisis, low-income countries and lower-middle-income countries now face a combination of soaring debt and high interest rates. Confronted with insufficient liquidity to respond to these challenges and unable to access capital markets, they need additional concessional finance, in the form of grants and soft loans. The European Union (EU) already provides concessional finance, but it is not nearly enough to respond to their growing needs. With European budgets under more strain than ever, this paper puts forward the case for finding ways to maximise the overall efficiency and impact of European concessional finance and in doing so, better articulating and combining grants and concessional loans in its support and investment toolbox. To remain relevant and maintain relationships and influence with partner countries–even more in a world characterised by the polycrisis and geopolitical fragmentation–the EU will have to step up its game when it comes to providing more strategic concessional finance. The paper sets out six complementary and non-mutually exclusive options for maximising EU concessional finance with a view to a strategic set of decisions to be made for the next EU Multiannual Financial Framework.
Topic:
Development, European Union, Financial Institutions, and Sustainable Development
Political Geography:
Europe

244. The EU’s Global Role: A Third Node of Power

Author:
Mikaela Gavas and W. Gyude Moore
Publication Date:
07-2024
Content Type:
Policy Brief
Institution:
Center for Global Development (CGD)
Abstract:
In recent years, a quest for economic security and strategic autonomy have come to define the European Union (EU)’s politics. The need to compete globally for the finite resources required for the green and digital transitions, and rivalries between the US and China for global dominance, are all driving this agenda. And while the COVID-19 pandemic and the war in Ukraine highlighted countries’ global dependencies, deepening geopolitical tensions have brought national security considerations to the fore. At the same time, the rise of populist parties across Europe is fuelling calls for countries’ national interests to play the defining role in development cooperation. This presents a challenging environment for EU development cooperation. Caught up in this new paradigm, development cooperation is increasingly viewed as a lever of hard power and an instrument of influence which can be used to reinforce Europe’s strategic autonomy and economic security. With European interests central to EU development cooperation strategy, the climate of distrust between Europe and its partners is being heightened, given the not-so-distant memory of European vaccine “nationalism” during the COVID-19 pandemic, the different standards some Europeans apply with regards to fossil fuel exploration and the negative repercussions the Green Deal will have on African countries’ growth and development. However, shaping EU development policy in this fashion, with geostrategic interests at its forefront will be more detrimental than helpful for the EU in the medium to long-term, and carries the risk of fuelling conflicts of interest with partners. Geo-economic fragmentation and a trust deficit when it comes to governments and societal institutions are threatening our ability to address pressing global challenges. In Africa, this fracturing is evident in the plethora of Africa plus-one summits, for example, the first ever Korea-Africa summit. Instead of using multilateral vehicles to address development cooperation, this new environment has spawned a diversion of resources toward more bilateral initiatives, where the geopolitical returns are direct and attributable. In this piece, we propose a reset of the EU’s international relations narrative and “third way” for the EU to position itself as a global development player.
Topic:
International Relations, Development, European Union, and Green Transition
Political Geography:
Europe

245. Transforming EU Climate Leadership through CBAM Reform

Author:
Ian Mitchell and Beata Cichocka
Publication Date:
09-2024
Content Type:
Policy Brief
Institution:
Center for Global Development (CGD)
Abstract:
The EU’s Carbon Border Adjustment Mechanism (CBAM) incentivises key countries, including China and India, to assess their policies around industrial carbon emissions. But CBAM faced criticism from low-income countries at COP28, with evidence suggesting that its economic impact on Africa could be as much as three times the amount of EU aid to the continent. While major emerging economies should face the full incentives from CBAM, lower income countries require a different approach. The Commission must review CBAM's impact on least developed countries (LDCs) by 2025. We propose it collaborates with the Council and Parliament to reform CBAM in two ways: Implement a longer transition period for LDCs, following the principle of "Common but Differentiated Responsibilities" Revisit the European Parliament’s proposal to allocate additional finance to the most vulnerable countries, by proposing that CBAM revenues be used to finance climate-related loss and damage, amounting to around 1 percent of the Commission’s annual budget by 2030. These reforms would show the EU is listening to partner countries and provide a new and additional source of climate funding. This would transform its reputation and strengthen its international negotiating position.
Topic:
Climate Change, Development, European Union, Carbon Emissions, and Carbon Border Adjustment Mechanism (CBAM)
Political Geography:
China, Europe, and India

246. Informe África 2024: El pacto migratorio y de asilo europeo

Author:
Fundación Alternativas
Publication Date:
04-2024
Content Type:
Special Report
Institution:
Fundación Alternativas
Abstract:
A las puertas de las las decisivas elecciones decisivas al Parlamento Europeo de junio de 2024, Europa mira hoy con miedo a la inmigración. La cuestión de la inmigración (más de 286.000 llegadas irregulares a Europa en 2023 según la OIM) se ha convertido en un asunto central para la política europea: en un instrumento para ganar o perder elecciones. El ascenso de partidos de ultraderecha o de corte nacional-populista en importantes países receptores de migrantes mayoritariamente de origen africano, como Italia (caso Lampedusa: 153.000 llegadas en 2023) o España (Canarias: 40.000), se debe en parte a una hábil explotación del miedo a este fenómeno. Gobiernos, administraciones, o medios de comunicación han ido construyendo discursos de una “Europa fortaleza” frente a África, que tienen éxito entre amplios sectores sociales, en especial las clases medias y trabajadoras de los países europeos, a pesar de que, según Naciones Unidas, solo alrededor de una cuarta parte de los africanos que emigran lo hacen a suelo europeo.
Topic:
Foreign Policy, Migration, Treaties and Agreements, European Union, and Asylum
Political Geography:
Africa and Europe

247. Autonomía estratégica abierta europea y ciclo electoral: Opciones frente a EEUU y China

Author:
Raquel Carretero, Lisa Garcia Bedolla, Vicente Palacio, Agueda Parra, and Ana Olmedo
Publication Date:
06-2024
Content Type:
Working Paper
Institution:
Fundación Alternativas
Abstract:
La UE debe contar con capacidades propias que le permitan reducir sus dependencias frente a EEUU y China. Pero Europa afronta dificultades e incertidumbres derivadas de factores políticos y económicos internos a Europa y EEUU. Dos grandes procesos electorales en 2024 (elecciones al Parlamento Europeo el 6-9 de junio, y elecciones presidenciales en EEUU el 5 noviembre) tendrán importantes implicaciones para la llamada “autonomía estratégica europea abierta”. Teniendo cuenta este contexto político, este documento aborda varios aspectos. Primero, las dinámicas de continuidad y de cambio del nuevo ciclo político. Segundo, las tendencias actuales de las relaciones UE-EEUU en tres ámbitos principales: tecnológico-digital; política energética y nueva política industrial del Pacto Verde; y defensa y seguridad. Tercero, la necesidad de la UE de resetear y fortalecer las relaciones económicas con Beijing. Cuarto, las posibles opciones de la UE y escenarios respecto a EEUU y China. Finalmente, algunas propuestas para avanzar en la dirección de una relación estratégica más equilibrada y “abierta” respecto a EEUU, China, y el Sur Global.
Topic:
Foreign Policy, Elections, European Union, Economy, and Strategic Autonomy
Political Geography:
United States, China, and Europe

248. The State of the European Union 2024: Integration vs. Nationalism

Author:
Diego López Garrido
Publication Date:
10-2024
Content Type:
Special Report
Institution:
Fundación Alternativas
Abstract:
In the new institutional cycle, the European Union is facing unprecedented challenges. This report studies and analyses some of the most outstanding aspects such as competitiveness and reindustrialisation in the light of competition from the USA and China; the transition to a decarbonised Europe; the need to defensively strengthen the Union and its foreign action; the migratory issue; the European social pillar or the rule of law. All this comes within a complex geopolitical context that helps to approach structural reforms to renewed institutions such as the European Parliament and the European Commission, where more conservative positions have thrived.
Topic:
Foreign Policy, European Union, Geopolitics, Industrialization, Economic Competition, and Green Transition
Political Geography:
Europe

249. China-Taiwan Relations and the EU: How European Soft Power Could Help Reduce Cross-Strait Tensions

Author:
Nicola Casarini
Publication Date:
05-2024
Content Type:
Commentary and Analysis
Institution:
Istituto Affari Internazionali
Abstract:
Russia’s war against Ukraine has brought back to the spotlight the question of China’s (officially the People’s Republic of China, PRC) potential attack on Taiwan (officially the Republic of China, ROC). Beijing claims that the island is one of its provinces, whereas the current Taiwanese government maintains that it is already an independent country. A conflict over Taiwan – or even a Chinese blockade of the island – would have immediate economic and political implications for Europe which will likely impose sanctions on the PRC, the EU’s second-largest trading partner.[1] The EU is not a security actor in East Asia, but has some formidable – and unique – soft power assets that could be leveraged to promote dialogue and understanding between China and Taiwan, with the objective of reducing tensions in the area and maintaining the status quo.
Topic:
Conflict Prevention, International Relations, European Union, and Geopolitics
Political Geography:
China, Europe, Taiwan, and Asia

250. Supply Chain Risks in EU-South Korea Relations: Semiconductor Industries

Author:
Sunkung Choi
Publication Date:
06-2024
Content Type:
Working Paper
Institution:
Istituto Affari Internazionali
Abstract:
Recent geopolitical crises and the Covid-19 pandemic have exposed weaknesses in global supply chains, leading to disruptions in the flow of goods and creating shortages. The semiconductor shortage crisis between 2020-2021 exacerbated these issues, particularly affecting industries reliant on chips. This crisis prompted governments and industries to prioritise resilience and independence in supply chains. This paper examines the causes, effects and implications of the supply chain crisis, focusing on the economic relations between the EU and South Korea. Both parties recognise the importance of addressing supply chain vulnerabilities and have initiated collaborative efforts to strengthen critical industries like batteries and semiconductors. Moving forward, strategic collaboration between the EU and South Korea will be crucial for effectively addressing the supply chain crisis. Measures such as enhancing supply chain resilience, investing in research and development and fostering technological cooperation are essential for ensuring economic stability and navigating future challenges.
Topic:
European Union, Trade, COVID-19, Supply Chains, and Semiconductors
Political Geography:
Europe, Asia, South Korea, and Germany