POLITICS-EUROPE: Berlin Summit “More Important Than Ever”

By IPS Correspondents Reprint | | Print |

Analysis - Yojana Sharma

BERLIN, Mar 18 1999 (IPS) - The mass resignation of all 20 European commissioners this week could hardly have come at a worse time for German Chancellor Gerhard Schroeder who is determined to uphold next week’s European summit in Berlin as a major success of Germany’s six-month European Union presidency.

Just one week before the March 24 meeting of European leaders, Schroeder was under pressure to keep the summit on the rails and show that the German presidency was able to rise to the institutional crisis.

“The need for unity (at the Berlin summit) is more important than ever. We must show, and show unequivocally, that Europe is able to act,” Schroeder said Tuesday, playing down talk of a crisis.

European officials agreed that, with important issues such as revamping the EU budget and reining in agricultural spending as part of the Agenda 2000 package to pave the way for Poland and the Czech Republic’s membership, the European Union cannot afford a prolonged crisis.

Officials said that Schroeder would be under pressure to show that member states can provide leadership to a weakened and discredited alliance.

“It is up to the European leaders to put the European show back on the road and show the European public that the European ideal can be salvaged and must be backed,” said one EU official.

For Schroeder, the summit was a chance to show his statesmanlike credentials. The German chancellor has been under fire since the his EU presidency began in January and, since he was elected last September, his government has drifted, particularly on domestic economic reforms.

Economic sluggishness in Germany – Europe’s largest economy – was dragging down the rest of Europe, and affecting European confidence in general, according to economists.

The weakness of the common currency the Euro in recent weeks was also blamed on the German government’s apparant lack of clarity and purpose – particularly by former German finance minister Oskar Lafontaine who resigned suddenly last week, after weeks of damaging cabinet infighting.

News of the Commission resignations reached Schroeder while he was still in Holland on the first leg of a week-long EU tour which began in Helsinki Monday. Coincidentally, he was already scheduled to be in Brussels Tuesday.

He arrived just hours after the mass resignation was announced.

Schroeder’s whirlwind tour was intended to pull the weight of European leaders behind Agenda 2000 and ensure a successful Berlin summit. It was also intended to reassure European leaders of Germany’s leadership of the EU in the wake of Lafontaine’s sudden departure.

During his tour Schroeder tried to focus minds on Berlin rather than Brussels. Schroeder insisted that first Agenda 2000 would be discussed at Berlin before the summit turned to the EU’s personnel problems.

Schroeder also declared the Berlin summit would be too early to agree on a successor to former commission president Jacques Santer. Usually commission presidents are appointed after months of horse trading and negotiations between the member states. The German presidency is proposing an informal summit after the Berlin summit in order to separate the institutional crisis from Agenda 2000.

“Certainly we will talk about the future commission but in the foreground will be Agenda 2000. That must not be pushed into the background by these events,” Schroeder said in a television interview while in Brussels.

“The Chancellor’s tour around the EU capitals is now even more important,” said Germany’s former foreign minister Hans-Dietrich Genscher in a commentary published Wednesday. “It is now taking place within a framework of increased responsibility of all the member states.”

“A delay in any decision ( on Agenda 2000) in Berlin would be unacceptable. It would have catastrophic consequences not only for the European Union but also for the European currency system,” he said.

Genscher said the consequences would be felt around the world, particularly the newly industrialised countries and the developing world which see the EU as a model. “Other regions follow the European example.

That was true for the ASEAN (Association of South East Asian Nations) states, for the states of the Gulf Cooperation Council, for Latin America, and the countries of Southern Africa will follow.”

Caribbean and Latin American banana exporters were also watching with some concern on how the commission crisis will play itself out during tough negotiations on bananas that were underway between the Europe and the United States.

Meanwhile a weak or unstable Euro currency, due to continued uncertainty in Europe, also could have a knock on effect around the world, Genscher said.

Analysts noted that Asia watches the Euro closely as it can affect the future of Asian exports to its second largest market after the US. A stronger Euro means more business for Asian exporters.

At a time when Asian economies themselves had endured prolonged crisis, Asian countries were looking to Europe to help boost their own export-led growth. A successful summit can only boost the Euro, and help Asia, according to financial analysts.

The German presidency has played down the role of the commission in preparing the summit. “Much of the commission’s work has already been completed. At the Berlin summit it will be political decisions that are needed,” said one Bonn official.

Yet some officials point out that it was the EU commissioner for agriculture, Austria’s Franz Fischler who last week steered EU agriculture ministers towards a compromise on farm spending, paving the way for a successful Berlin summit. “That role of mediator must now be assumed by the German presidency,” an EU diplomat said.

But observers noted the presidency itself had been weakened by the departure of Lafontaine. Germany’s new finance minister Hans Eichel is not due to take over his post until early April, after the Berlin summit.

In Vienna Wednesday, Schroeder said he and Austrian Chancellor Viktor Klima agreed that the reforms agreed by agriculture ministers agreed last week should not be unravelled. Officials said any unpicking of the agreement would need new proposals from the now defunct commission.

Meanwhile Members of the European Parliament were threatening another vote of censure if former commission president Jacques Santer or French commissioner Edith Cresson who is implicated in the report of the wise men released Monday, returned to the commission – even in a caretaker role.

This could plunge the Europe into months of crisis and uncertainty