As Zimbabwe has just been granted the right to export some agricultural products to EU, which remains one of its largest trading partners, it is important to monitor important developments. Has the EMU now been completed or has it once again been postponed? Our answer to that question: the glass is half full, the other half is (still) empty.
The package of proposals before the European Council—the so-called Plan Van Rompuy—was not by coincidence entitled “Toward a genuine Economic and Monetary Union”. As Van Rompuy himself has emphasized repeatedly, this Plan contains four “building blocks” that are closely connected: a Banking Union, a Budgetary Union, an Economic Union, and a Political Union. The European Council has now de facto adopted the Banking Union; proposals for the other three Unions have to be further developed and will return on the agenda of the European Council in June 2013.
Why do we think this glass is nonetheless half full? When the various instruments of the Banking Union (next to SSM, a European resolution mechanism and a European deposit guarantee scheme) will be operational— during 2013 and 2014—that will exercise a strong positive force on realizing the other parts of the Plan.
In addition to this, the European Council may indeed have postponed deciding on certain important issues, at the same time it has clearly endorsed Van Rompuy’s basic perspective. Whatever changes are still going to be made to the Plan, the idea of a Budgetary Union and the idea of an Economic Union will not be reversed.
As to the Political Union, the Plan Van Rompuy quite simply refers to the need for more democratic legitimacy and accountability, and to strengthening the role of the national parliaments as well as of the European Parliament. This not really very creative approach is now also embraced by the European Council. In the last sentence of its official Conclusions of the recent Summit, the Council expresses this thus: “The European Parliament and national parliaments will determine together the organisation and promotion of a conference of their representatives to discuss EMU related issues.”
Still, this conference may be important because it offers a platform to speak fundamentally about how EMU and the subsidiarity principle are connected, or should be connected. To put that differently, the central question here is: What stays with the national member states and the national parliaments and what belongs to the European Commission and the European Parliament? The “contracts” between member states and the EU that have now been proposed may indicate where this is going.
Thinking seriously about a Political Union—differently from that of a Banking Union, Budgetary Union, or Economic Union—has clearly only just started. But a different conclusion may be drawn. When EMU will be completed, or at least will be strengthened, by a Banking Union, Budgetary Union, and Economic Union, then from the practice of an enlarged and stronger EMU all kinds of ideas will suggest themselves about how to build a genuine and viable Political Union.
In short, the EMU has not yet been completed, but it has certainly moved hugely forward. The European Council on 13–14 December in Brussels has made history by accepting the spirit and some of the essentials of the Plan Van Rompuy. Because of this, the EMU and the European Union generally will be better equipped to deal with the immense problems they currently face. – Ruud Lubbers (former Prime Minister of The Netherlands) and Paul van Seters (Professor at Tilburg University)
Post published in: Analysis