France and Germany said at their bilateral summit in Meseberg (see EUROPE 12043) on Tuesday 19 June that they had agreed joint positions on two issues that lie at the heart of the forthcoming European summit – deepening Economic and Monetary Union (EMU) and managing migration.
To each of these matters, “we need European responses”, so that the European Union can, in future, continue to play a role on the international scene, adhering to its intrinsic values, stated German Chancellor Angela Merkel, the summit host. Speaking of “a moment of truth” for Europe, French President Emmanuel Macron urged stronger “European sovereignty”.
Eurozone. Discussions on deepening economic and monetary union were the “most complicated”, as Merkel acknowledged. Recent statements from Paris and Berlin have made clear a number of differences of opinion on key points (see EUROPE 12033 and 12037).
In what was a major issue for Macron, the two parties agreed on the principle of a specific eurozone budget with its own governance. Merkel and Macron expressed their wish that this eurozone budget should come into being at the same time as the next multiannual financial framework (MFF), that is to say, in 2021. The French president indicated, further, that the budget should be supervised by the European Commission. This specific budget, funded through national contributions and possible European taxes and resources, would have an investment and convergence function in order to “support member states facing difficulties”, according to Macron.
But, though few technical and content details were given about this suggested specific budget, which will be discussed by the heads of state and/or government of the member states at the eurozone summit on 29 June, the comments of the two leaders clearly indicated that they believe the European investment stabilisation function, proposed by the Commission on 31 May within the framework of the multiannual financial framework (see EUROPE 12031), should lead to the creation of a credit line backed by the European Stability Mechanism (ESM), access to which would be conditional on compliance with a number of criteria.
As in the Commission’s initial proposal, it should come to the assistance of a member state impacted by an asymmetric economic shock. Putting this mechanism in the ESM would mean, however, that decisions would have to be taken by unanimity at the inter-governmental level and would require the approval of national parliaments. This is an option that should satisfy Berlin.
Merkel and Macron also agreed on the principle of making the ESM the common backstop of the Single Resolution Fund (SRF), which would make speedy action possible in the event of the failure of a banking establishment.
Lastly, while the German chancellor spoke of the ESM developing “towards a European Monetary Fund (EMF)”, this name was very quickly dropped in the press conference. France and Germany want, then, to focus on extending the areas of responsibility of the current ESM, still within an intergovernmental framework, contrary to what is being advocated by the Commission (see EUROPE 11920).
Merkel and Macron will now put their proposals to their EU counterparts on 29 June. The proposals will also provide a backdrop to the Eurogroup discussions in Luxembourg on Thursday 21 June (see other article).
Migration. How to manage migration is the burning issue of the moment in the wake of the incident that began with Italy’s refusal to allow migrants on board the vessel Aquarius to land.
“Grandstanding never leads to wise decisions”, observed Macron, calling for account to be taken of all aspects of the challenge that is migration.
Just as in the statements made after the recent Franco-Italian summit (see EUROPE 12042), Macron highlighted three areas to be developed: - working with transit countries and countries of origin so as to prevent migration flows and dismantle illegal networks; - ensuring better protection for Europe’s external borders by allocating “10,000 men” to the European border patrol and coast guard corps (Frontex) transforming it into “a real European border police force”; - agreeing a European asylum system underpinned by “responsibility and solidarity”, with “a real European asylum agency” and real harmonisation of EU asylum law.
For Merkel, in reference to the dispute with the CSU, the Bavarian party that is her partner in government, “resolute” action was also needed to avoid secondary movement within the EU. When asked about potentially returning asylum seekers to the countries where they had lodged their asylum requests, Macron could not see any particular problem in doing so within the Schengen area.
See the Meseberg Declaration: https://bit.ly/2JR6LnB (Original version in French by Mathieu Bion and Lucas Tripoteau)