Mediterranean: a blockage clearly anticipated. The cancellation of the Euro-Mediterranean summit should not come as a surprise to anybody, especially not to the readers of this column. Since the beginning of this project, this column has argued that the way in which it has been set up prevents it from working. I do not share the opinion that the main reasons for the failure are due to the Israeli-Palestinian conflict or internal EU uncertainties regarding the distribution of competencies between Community institutions and the member states. These aspects do play a role but they should not be used as alibis or excuses. The very seeds of failure were, in fact, present from the outset. The word Union means what it says: on the European side, a Union exists (despite its shortcomings) and among non-EU Mediterranean countries this Union does not exist. Another Union bringing together these disparate entities is an abstraction.
How can a comprehensive free trade zone be considered if significant trade barriers still exist between the countries on one side of the Mediterranean? How can we talk about a compact group if almost every Mediterranean third country is seeking to establish different and specific relations with the EU? For Turkey, the goal is accession; a special partnership for those countries that fulfil the conditions; and less close relations for the other countries. The inclusion of the Balkan countries neighbouring the Adriatic has added to the confusion and highlighted the different objectives. Unity between countries on the southern side of the Mediterranean is a myth and the people in Adriatic countries are unaware of their theoretical participation in a Union with North Africa. The most fallacious rhetoric is hidden behind speeches devoid of substance.
For real hands-on achievements. These observations do not in any way mean that accomplishments, limited in their objectives and within their geographical dimension, are impossible. On the contrary, they are indispensable and a few achievements are being accomplished and put into practice before our very eyes. Negotiations on the accession of Balkan countries are making progress. Turkey is linked to the EU in a customs union, which is more than just a free-trade zone. Individual trade agreements, differing from country to country, have been concluded or are being negotiated. With countries that don't seek free trade, energy cooperation is taking shape. Common and sometimes essential projects are in their embryonic stages and involve protecting the sea and its resources, or resolving the problem of water. All this can and must be better organised and the instruments that already exist, or which have been created, can be used. Nonetheless, the fallacious hypothesis of a Union incorporating all neighbouring countries into a compact whole must be rejected.
Is the financial community incorrigible? There is always an opportunity to learn something. Last week, this column justified the measure for making bankers, who demand excessive interest rates to finance member states in budgetary difficulty, participate in arrangements which become indispensable if the debtor country is unable to respect all the commitments that it has made. This is the logical price of speculation and usury. The principle of joint responsibility of the private sector in the event of bankruptcy was proposed by the Franco-German Deauville declaration and was, in principle, retained by the European Council. The president of the ECB (European Central Bank) sharply criticised this provision and claimed that it would make the situation even more difficult and laborious for member states in difficulty seeking to float their treasury bonds on the market.
The facts prove that Mr Trichet was right. Faced with the possibility of sharing in the costs of a member state's budgetary weaknesses, the borrowing costs for at-risk countries shot up and investors unburdened themselves of their Irish loans, to the point that finance ministers in Germany, France, the United Kingdom, Italy and Spain had to publish a hurried press statement explaining that the possible involvement of the private sector “would not be applied to adjustment programmes or to sovereign debt targeted by existing instruments” (EUROPE 10255). Ministers pointed out that the current European Financial Stability Facility did not include private sector involvement. If this involvement were advocated, it would be applicable to the system which will only enter into force in 2013.
This confirms that any talk about ethics in the financial community is a waste of time. Ms Merkel, who strongly argued for private sector involvement used common sense to justify this: “How can we expect citizens to bear the cost of certain risks instead of those who have earned a lot of money by taking these risks?” The financial community, however, is both demanding astronomical interest rates and the guarantee of total repayment. The époque where Dante cast the usurers into hell is long gone.
(F.R./transl.fl)