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Europe Daily Bulletin No. 8136
A LOOK BEHIND THE NEWS /

Visit to Bratislava - Economic implications of EMU - Some important Initial signs

Central Europe and Us. The kindness of a European politician and my interest in Central and Eastern European countries led to my visiting Bratislava at the beginning of the week. Once again, I was unable to avoid noticing how fifty years spent behind the Iron Curtain had so significantly conditioned the psychological attitude of a section of the indigenous ruling class. Not that they feel different or far removed from western Europe, on the contrary, they have a certain fear of EU public opinion. Professor Juraj Stern, Slovak Foreign Policy Association Chairman, asserted in a passionate address to European Union representatives that citizens from the EU did not understand their tastes or traditions, explaining that Slovaks had grown up reading Alexandre Dumas, Jules Verne (Ms Kadlecikova even mentioned Jacques Prévert) and listened to the same music. Mr Stern said they spoke the languages of the Community and the "Schengen Border" was a kilometre away, with Vienna just 50 kilometres from Bratislava. The Slovak people had voted by a 78% majority to join the EU. This is the reality but, continued Professor Stern, EU public opinion is worried by a completely imaginary flood of workers from the former Eastern block into Member States.

Professor Stern is spot on. It is not enough to say that we and Central Europe share the same roots and values, when in fact we share the same culture and history. We grew up reading Ferenc Molnar, Franz Kafka and listened to Léhar, Chopin, Dvorak and Smetana. Joining the EU for these countries represents coming home. We have not stressed this aspect enough (in the same way that they should not be so obsessed with aid to their farmers). I asked what the main resources of Slovakia were, a lady answered, that it was their education system, the education they gave to their children. I was struck by the dignity of these people.

Who's afraid of the Delors EMU Strategy? The criticism I heard about Jacques Delors' idea for transforming the European Monetary Union to Twelve with "strengthened co-operation" in keeping with the Treaty (see this section in our bulletin of 17 January), are motivated by the idea that such an initiative at this moment, this juncture would not be warmly received and complicate matters. In practice, there is anxiet yabout why we should enter into a quarrel with three countries of the EU which are not part of the Euro-zone, a spat that could drag the Union into a slippery institutional swamp. A source of conflict, what advantages?

Jacques Delors will say that this is what he wants. I will just make three points:

1. Strengthening the economic pillar of the EMU is recognised by most political and economic actors (see this section in our bulletin of 16 January). Initiatives are necessary. It would be contradictory to just admit that the current situation is unsatisfactory but clam up as soon as any ideas are proposed.

2. Eurogroup as it is, cannot provide any solution or decide, discuss or suggest anything, as the Economic and Financial Council is the only body that can act. Strengthening Eurogroup as an intergovernmental organisation would exclude the "Community method", an essential aspect of European policy, leaving economic co-ordination to a system of co-operation between Member States, with subsequent repercussions: domination by big countries, browbeating of small countries, democracy and transparency deficit. "Strengthened co-operation" would, however, require the participation of the Commission and Parliament in the consultation process and open the doors to all EU countries that wish to join the Euro-zone, whilst meeting its conditions.

3. Euro-zone countries will be in a minority in a few years time on the Ecofin Council, at least for a certain period. This will result in a farcical situation: Member States that do not belong to the Euro-zone could have an overriding influence on the economic decision taken in countries of the Euro-zone and curtail the autonomy of governments that wanted the Euro, where the Euro is in effect the given currency.

Hence, it is not an institutional or theoretical quarrel, but something crucial for the economic development of the Euro-zone, the core of a united Europe. Let's stop trying to avoid heated debates! I await with both curiosity and interest, the Eurogroup document referred to by President Prodi. I also call on readers to not underestimate a Financial Times article at the beginning of the week on the so-called EU "Super Council" project consisting of the three largest countries. It is obvious that there's no plan as yet, but the signs are there in readiness for the Convention. It also goes towards strengthening the intergovernmental method, like the tendency for strengthening Eurogroup on the parameters of the Community institutions. That's why Jacques Delors' idea is important. (FR)

 

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A LOOK BEHIND THE NEWS
THE DAY IN POLITICS
GENERAL NEWS
ECONOMIC INTERPENETRATION