Wednesday, January 2, 2013

What to read in 2013

The list of books on foreign affairs expected to be published in the next 6 months, according to Foreign Policy.
I would like to have a look and read the pages of the choices no.:6, 7, 9, 15, 20, 23, 24,25.

What's ahead for emerging economies in 2013?

Some economic expectations via The Economist.

ECFR Predictions for 2013

2012 saw continuing crisis in the eurozone, growing Euroscepticism and populism in some corners of Europe, faltering transitions in Egypt and elsewhere, more violence in Syria, a new leadership in China, and both Putin II and Obama II. 

So what will 2013 hold? Gazing into our crystal ball, we came up with the following ideas (although it's fair to say that we were divided on many of them). 

1. The single market unravels.
As ECFR’s recent paper - “Why the euro crisis threatens the EU’s single market” - shows, however the EU and eurozone deal with the crisis this main achievement of European integration will be damaged. A full eurozone break up would shatter the single market (and Schengen) while a great leap towards integration would see shrinkage as others (like the UK) withdraw. But even “muddling through” will diminish its depth.  In the past months banks in the eurozone have withdrawn from cross-border business. Because of the spreads, even poorly-managed German companies are paying significantly less interest than well-managed Spanish companies. All of these developments create new barriers and will lead to a renewed focus on domestic markets. For Europe, this means less competition, less growth, and higher prices for consumers. Our forthcoming paper on Europe’s “New Political Geography” (based upon ECFR’s 2012 series of 14 National Papers) shows how many EU member states are deeply concerned that differentiated integration is forcing them to the periphery of the European project.

2. “Small” states lead the EU’s foreign policy.
While the biggest countries of the eurozone are focused on the crisis and the UK is increasingly disengaged from Europe, new coalitions of willing members have been leading on the EU’s foreign policy. ECFR’s “Foreign Policy Scorecard 2012” showed that Poland and Sweden were the ones taking the initiative and leading Europe on the world stage. This year’s Scorecard, due to be published later this month, shows that Sweden is taking the initiative roughly as much as traditional large powers like France and the UK, with the Netherlands and Finland also demonstrating that in EU foreign policy size isn’t the only thing that matters.

3. The end of technocracy.
After a year where technocrats took over the countries of the periphery and other leaders, electoral politics will return to European integration. In Italy the vote could turn into a referendum on Monti’s reforms, with or without the current prime minister’s participation, with substantial implications for the rest of Europe.  And the German elections could also see a new government elected that has less constraints on what it is able to do – although the danger is that Europe will be largely absent from the campaign.

4. The British debate over Europe becomes less toxic.
Although the UK Independence Party will continue to make gains and force many Conservative MPs towards more Eurosceptic positions, 2013 will see a growing realisation that the UK is sleepwalking towards a disastrous EU exit. Business leaders will lead the backlash, followed by politicians – including many Conservatives who decide that Euroscepticism divides their own party, helps UKIP, and distracts from their own challenges with economic dysfunction and a fractious coalition. The arguments over Scottish EU membership also serve to highlight the tangible benefits of membership (see Peter Kellner’s ECFR paper on how the result of a British referendum on the EU may turn on how many judge the EU in pragmatic rather than ideological terms).

5. Syria as the playground for proxy conflicts.
The ongoing civil war in Syria is the epicentre of a wider regional battle, complicating hopes of resolution and bringing in the threat of wider destabilisation. It is sharpening sectarian tensions, reinvigorating dormant Sunni jihadi forces, pushing Iran and its allies on the defensive, and providing new room for Kurdish ambitions. The febrile atmosphere in Kurdistan is opening cracks between Ankara and its de facto allies Saudi Arabia and Qatar, and reverberations are spreading into northern Iraq.

6. Political versus religious Islam.
With a backlash against political Islam evident in Egypt and Tunisia, it’s apparent that the Muslim Brotherhood and other Islamists are finding it hard to deal with voters’ everyday practical problems and aspirations. Islamist parties have been forced to develop a more mature political style and formulate policies on socio-economic challenges to retain the support of essentially traditional and pragmatic voters.  However this is creating a gap between political Islamists and their religious such as the Salafists who are seeking to take advantage of greater religiosity in civil society. This tension will become a defining issue for countries such as Egypt and Tunisia as they continue their political transitions.

7. Putin’s increasingly ungovernable Russia.
A sick and politically enfeebled Putin is no longer able to play different power clans off against each other, making the country increasingly ungovernable while the petro-economy slows down. This may prompt a return to defensive/aggressive posturing to its south and west (it will keep quiet over China), for instance through greater involvement in the Former Soviet Union (meddling in Ukraine and Georgia), and diplomatic muscle flexing in Syria and with the US and NATO over missile defence and the Magnitski list. However, underlying this is the realisation that Russia desperately needs the West and can’t afford to push too hard in difficult times.

8. Security in the Maghreb becomes a real issue.
While UN and African peacekeepers struggle with the crisis in Mali, Al Qaeda in the Islamic Maghreb (AQIM) will attempt to extend its ambitions to terrorist attacks in Europe, prompting an increase in French military strikes against AQIM.

9. China 3.0 meets Chinese leadership 1.5.
Chinese intellectuals and thinkers, think their country needs to enter a new era. After Mao’s political revolution (‘China 1.0’) and Deng Xiaoping’s economic revolution (‘China 2.0’), they are expecting a ‘China 3.0’. Now that China is becoming more affluent, how does China deal with growing inequalities, rebalance its economy and increase its exposure to the global economy? How does the Communist Party retain stability, with increasing friction within Chinese society and half a billion ‘netizens’ active on the web? But the 18th Party congress has anointed leaders who have more in common with the past than the future.  As the political system becomes more rigid, and its foreign policy more aggressive, there is a growing tension between China’s strong society and its weak political system.
And finally, the big question in European foreign policy is…

10. Will post-American Europe fail to grow up or discover strategy?
For European foreign policy the elections didn’t really matter, and now President Obama is proving it by showing that a “pivot” to Asia is a fundamental “shift” away from the North Atlantic. As the 2013 Scorecard suggests, Europe continues to find ways to fail to come to terms with foreign policy… but if Europe’s leaders finally look up from the euro crisis, notice how much the continent has lost power, prestige and influence, and accept the need to formulate a European Global Strategy it could all be so different (perhaps in 2014).

And a word about how well we did with our predictions last year:

1. A “European Clash of Civilisations” – True (and predictable) enough, in as much as the EU has been torn (between core and periphery, eurozone and non-eurozone, “virtuous” North and “profligate” South) for much of 2013. The picture is of course far more complicated, as our National Paper series shows, but we called this one right.

2. Germany discovers that it’s a European country – There are signs that the debate in Europe is now shifting, with questions of political integration now being discussed (not quite extending to eurobonds). Maybe we had better judge this one after the 2013 German elections are out of the way…

3. A British Europe without Britain – British Eurosceptics have certainly had a good year (although next year may not be so promising), and there are definite signs that aspects of the EU (for instance a greater role for national governments, liberal reforms for the periphery, loss of central institutional power) are becoming more “British.”

4. China is forced into a financial G3 to safeguard the value of its reserves – this has not held up quite so well, although as we noted, the power shift to the East needs to take into account China’s economic interdependence with the West and its need to rebalance its economy.

5. The Russian Scramble for Europe (and banks) – So far this has not happened, although the situation in Cyprus, where Russia has played an important role in helping the country deal with the financial crisis, shows that Russian investment is something that the EU should not ignore.

6. The remilitarisation of Europe – Although the crisis and international impotence over Syria has crowded out real discussion of European strategy, there is a feeling in some corners of ECFR that 2013 could be the real year where an EU-wide sharing of security concerns and capacity could be on the cards…

7. China discovers competitive politics while reinforcing authoritarianism – The Bo Xilai affair and the autumn leadership “selection” showed that authoritarianism was reinforced without much in the way of competitive politics – although (as discussed in ECFR’s “China 3.0”) there is a vibrant internal Chinese debate over other mechanisms for political representation and competition.

8. The Domesticated Brotherhood – As noted in this year’s set of “Ten Trends”, political Islam has found its first steps in government to be difficult ones, leading to something of a recent anti-Islamist backlash. This has led to a tension between political Islam and religious Islam that we think could be a big story in 2013.

9. A perfect Iranian storm – At the time of writing this has not happened, although Iran and its nuclear programme remains a toxic issue in the Middle East and beyond.

10. The Youthquake doesn’t happen – Despite the Occupy Movement, the Pirate Party and so much else, we were right: organised older folk and the impotence of treating Facebook “likes” as a real proxy for voting and participation means the “Youthquake” is yet to happen.

Tuesday, January 1, 2013

The hopes of the new EU Irish presidency

The six-month Irish presidency will have to deal with the continuation of the financial crisis and the need for more jobs and economic growth. As other countries before, the Irish officials promise to offer good solutions for a sustainable recovery of Europe.

Realistically speaking, there are no expectations for a resolution of the debt crisis, but the next months may be important in creating more opportunities for growth. However, Ireland will demonstrate its support for the development of the hi-tech sector, as the most efficient way to support the long-term economic boost.
The Irish presidency will push forward for promoting the harmonization of the professional qualifications on the EU market. One of the suggestions is to create a professional ‘card’ allowing each holder to register his or her qualifications on a dedicated website.

Another priority endeavoured by Ireland concerns the problem of the language of the public procurement procedures. The public tenders have a contribution to the European economic growth of 19%.
Last but not least, the next six months are important in finding a solution to the rights of workers in one country to be sent to work on contracts in another EU country, an issue that is addressed in several rulings of the Court of Justice. Poland and France have opposite opinions in this respect.

Equally important are the discussions regarding the negotiations on the seven-year EU budget, following the failure at the end of last year. Last November, the European leaders were unable to to agree on the size of the cuts to the €1 trillion budget. The EU leaders need to find an extra €30 billion odd to bridge the gap between UK demands for a smaller budget and calls by France and other countries for programmes such as the Common Agriculture Policy (CAP) and Cohesion funding to be maintained. Discussions on this issue are expected at the 7-8 February summit. Next on the agenda are the projects for reforming both CAP and the Common Fisheries Policy, but the final decision belongs to the European Parliament.

The subject of the permanent bailout fund will continue during the next six months, without too many expectations for an agreement. Several meetings of the finance ministers will approach this sensitive topic.
The European Commission will continue the dialogue regarding the possibilities for signing free-trade agreements with third countries. After Singapore, Peru, Columbia and South Korea, the discussions regarding similar documents signed with India, US and Japan are included in the priority list of the next months. Especially the US-EU deal may have direct positive effects on the Irish economy, according to economic experts.

In terms of enlargement, there are expected more discussions with the Balkan countries, with Serbia waiting to be given a date for the beginning of the negotiations. The same hopes are expressed in Skopje. There are not too many chances that there will be clear positions concerning the eventual admission of Turkey. The foreign agenda will most likely keep the Syrian problems, due to the concerns regarding human rights, as well as the Iranian nuclear file and the evolutions in the Middle East.

The beginning of the EU Irish presidency was inaugurated with a special flag-raising ceremony that took place at Dublin Castle, in the presence of local officials, including the Minister of State for European Affairs, Lucinda Creighton. During the six months of the presidency, around 1,600 meetings are scheduled, out of which 180 will take place in Ireland.

It is the country’s seventh presidential term, 40 years after Ireland became a full member of the EU, in 1973. 
The last time when Ireland held the office of the European Union, in 2004, the country was going through a favourable time, as the so-called Celtic Tiger was highly appreciated for the good economic performances. One of the most noteworthy performances of the latest Irish presidency was the successful negotiation of the EU Constitution, at the end of difficult negotiations.


Startfor analysis: The Benghazi Report and the Diplomatic Security Funding Cycle

The Benghazi Report and the Diplomatic Security Funding Cycle is an another Startfor introspection into the challenges of diplomacy. One of the most interesting ideas, by far, is how diplomacy can take the advantage of the 2.0 world for a limited diplomatic activity in hostile areas. Something to think more about in the next days...