European Union

At the Nato summit in Warsaw US President Barack Obama spoke out critically on the conflict over Poland's Constitutional Tribunal. His words were then presented as praise for the government in a televised report by Polish public broadcaster TVP. The media discuss what he really said and whether he stepped out of line in expressing a view on the issue.

The EU finance ministers are discussing Italy's plans to bail out the Banca Monte dei Paschi di Siena with taxpayers' money. This would be a breach of EU banking rules according to which the owners and creditors must agree to pay part of the costs of a bailout. Do the rules really need to be adjusted?

The Euro 2016 has ended with the victory of the Portuguese team. Commentators disagree: does football help to overcome crises?

The participants at the Nato summit in Warsaw have agreed to station 4,000 soldiers in Poland and the Baltic states to protect these countries from Russian aggression. Is this military build-up the right way to deal with Moscow?

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The 18th bilateral summit between the EU and China takes place on 12-13 July in Beijing. Discussions focus on political and economic relations as well as global and regional issues, in the framework of the jointly agreed EU-China 2020 strategic agenda for cooperation.

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Europe is facing its worst security crises in living memory. To its south, Daesh has filled the Middle East’s power vacuums, driving a refugee crisis that threatens to tear the European Union apart as each nation reacts on its own rather than in the collective interest. To the east, Russia’s flagrant disregard for international norms with its continued actions in Ukraine and recent aggression in Syria further undermine the allusion of a Europe ‘whole and free’. The case for Europe’s once-vaunted ‘soft power’ seems broken by these ‘hard power’ realities collapsing on it. Adding insult to injury, the US presidential election has only reinforced how alone Europe is on these issues, as Americans deal with fierce internal divisions and a populist extremism unlike anything seen in over a century. Against this pessimistic backdrop, there is room for optimism in one of the most unlikely places for Europe: Asia.

Europeans, consumed by their own problems, aren’t thinking as strategically about Asia as Asians are about Europe. Russia’s unchecked actions in Ukraine are being carefully watched as a potential blueprint for China on its own challenge to international rules in the South China Sea. Today, maritime rule of law is the most contentious soft power issue in the Asia-Pacific, and Europe has one of the most under-appreciated roles to play in it. While it’s unrealistic to expect European ships to move beyond the Horn of Africa in significant numbers, the symbolism of having a European contingency, whether through NATO or not, as part of existing operations and planning won’t be lost on Beijing. Unlike Moscow, which seems immune to international opinion or sanctions, Beijing depends very much on remaining part of the international community for sustaining its single-party rule predicated on continued economic growth. China nonetheless seeks to revise international norms according to its authoritarian values by threatening neighbours while flouting international law.

“Europeans aren’t thinking as strategically about Asia as Asians are about Europe”

Given this reality, Europe mustn’t lose sight of the importance of common values and rule of law originating from the region. European nations pioneered the freedom of navigation that now account for just over 98% of all global trade flows. Europe gave birth to maritime rule of law in 1618 when Hugo Grotius conceived of ‘freedom of the seas’ to ensure the world’s oceans remained open and accessible to all for international trade. The 1648 Treaty of Westphalia organised Grotius’s argument, and modern maritime trade officially started. The International Tribunal for the Law of the Sea is located in Germany, and Europe has considerable stakes in preserving the rule of law in Asian seas. Without US participation, the EU is the default vanguard of the United Nations Convention on Law of the Seas (UNCLOS). There is also geopolitical logic to Europe defending maritime rule of law. Late Yale University professor Nicholas Spykman argued in 1942 that controlling ‘marginal seas’ in coastal areas in Europe and Asia would be prerequisite for sustaining access to Eurasia’s peripheral lands. In post-war Europe, US naval power led NATO in accomplishing this task by controlling the Mediterranean, facilitating the alliance’s focus on deterring Russian land power while successfully implementing the EU’s inception. Today, the Indo-Pacific region has the potential to become a marginal sea embracing the chain of burgeoning liberalism stretching from India to Japan. Spykman foresaw this region emerging as ‘the Asiatic Mediterranean’, a term that is now back in fashion. At a time when China threatens this potential, Europe finds itself in a strong position not only to protect its regional stakes, but also to guide Asia’s liberal stride by leveraging its own experience and values.

Europe’s soft power strategy in the Asiatic Mediterranean should begin by boosting relations with its regional liberal partners Australia, India, South Korea and most importantly Japan, its Asian anchor. Europe already has a military partnership with Japan in the form of the NATO-Japan partnership, and Tokyo’s contributions to NATO include various operational activities ranging from logistical supplies in the Indian Ocean for operations in Afghanistan to joint counter-piracy operations in the Gulf of Aden. In 2014, Japanese Prime Minister Shinzō Abe called his country ‘a natural partner for NATO’ that shares common ‘responsibility for advancing rule of law in the world’s oceans’.

“Europe gave birth to maritime rule of law, and without the US is the default vanguard of the United Nations Convention on Law of the Seas”

This stands to be fortuitous year for elevating NATO-Japan relations. For one thing, Japan is increasingly keen on demonstrating its global leadership, as it did in May as host country for this year’s G7 summit. As China’s provocations continue to add volatility to the Asiatic Mediterranean, European G7 members and Japan should use this opportune time to inaugurate a joint regional security initiative, such as a European or NATO Maritime Security Conference in Asia. Such a conference would serve as a ministerial-level dialogue with membership consisting of NATO, Japan, South Korea, India, Australia, ASEAN, and eventually China if international norms and rules are accepted. Building a multilateral process with like-minded nations will present a united alternative to China’s unilateralism in the South China Sea, and will make it much more likely that Beijing will choose to be a part of the system than continue its current path. Indeed, because China could significantly benefit from participating in the Trans-Pacific Partnership (TPP), Beijing’s compliance with maritime rule of law would be the first step toward the inclusion of the second-largest economy in the emerging multilateral free trade agreement.

There is of course no panacea, and China’s maritime behaviour does not pose physical threats to European or US national security interests as much as Russia or the refugee crisis. Nonetheless, China is ‘eating sticky candy bit by bit’ as Mao Zedong might describe Beijing’s attritional strategy. The invisible casualty is the very existence of maritime rule of law, and 2016 appears to be make-or-break for Europe to preserve and protect international rule of law with its soft power by collaborating with its increasingly willing, proactive Japanese partner and coming together to weather the collective storm.

IMAGE CREDIT: CC / FLICKR – U.S. Pacific Fleet

The post Europe’s soft power could defuse Asia’s crises appeared first on Europe’s World.

Asian security is being threatened at a multitude of flashpoints. In the northeast, North Korea under Kim Jong-un has launched long-range ballistic missiles after beginning the year by carrying out its fourth nuclear test, and it was announced in early March that Pyongyang now possesses nuclear warheads that fit to its ballistic missiles. Given that these weapons can be expected to reach US territory, Washington announced the dispatch of three nuclear-armed stealth bombers to east Asia while it carried out a large-scale military exercise with South Korea. In the southeast, tensions in the South China Sea have heightened as the US Navy sent several ships under the banner of ‘freedom of navigation operations’ to the disputed Spratly Islands, where China has escalated militarisation by deploying surface-to-air missiles and constructing runways.

As security becomes more fragile in both the north and southeast of Asia, should the EU become more clearly engaged? My answer is conditionally yes. These Asian flashpoints are not directly impacting the daily lives of European citizens, like the refugee crisis or Russian antagonism, but I believe the EU needs to be engaged in Asian security for the sake of its economic and business stability.

 “The EU needs to be engaged in Asian security for the sake of its economic and business stability”

The economy has played a key role in contemporary international relations, especially in east Asia. According to the World Bank, the region’s estimated growth for last year was 6.5%, while the European Commission estimated a figure of 1.6% for the EU. Japanese Prime Minister Shinzō Abe has named the 10-member Association of Southeast Asian Nations (ASEAN) as a ‘growth centre of the world’, and this view was actively reflected in the increase in Japan’s share of foreign direct investment in ASEAN from 3% in 2012 to 17% in 2013. A chief reason behind the US push for the Trans-Pacific Partnership (TPP) was similarly to access Asian growth and put the American economy back on track by establishing common trade and investment rules with the Asia-Pacific region. With its successful launch, the TPP is expected to promote structural reforms in member economies, sustaining the region’s continued growth. Thailand, the Philippines and Indonesia have each expressed interest in joining, and the US has welcomed the move. The US-ASEAN Special Leaders’ Summit, held this February, was partly designed to bolster US endeavours to urge those and other ASEAN members to join the TPP in the near future.

A unique feature of the TPP is that political leaders tend to view the agreement not only with domestic political economy considerations, but also strategic and military perspectives. Akira Amari, formerly Japan’s Economic Revitalisation Minister in charge of the TPP, often told his US counterpart Michael Froman that ‘we come to negotiate despite opposition back home because we think US involvement is crucial for the stability of east Asia.‘ East Asia’s general acceptance, with the notable exceptions of China and North Korea, of the American commitment to the creation of a free economic zone with its preferred rules and standards is attributed to their reassurance from continued US military and strategic presence. This means the TPP is perceived, at least partly, as the foundation for regional security.

The EU has also shown an interest in capitalising on east Asian growth for its economic and business interests. After signing an FTA with South Korea, which became effective on 1st July 2011, the EU has now chosen potential FTA partners from those that participated in the TPP talks, such as Japan, Singapore, Malaysia and Vietnam, or that have signed an FTA with the United States. The EU’s FTA strategy in east Asia thus has the characteristic of ‘chasing the US’, and this reactive approach is now mixing with east Asia’s general view of the EU as being heavily obsessed with its own intra-regional problems and conflicts, including the Brexit issue, and as not being sincerely interested in east Asian affairs. But the EU isn’t the US, and so it should engage in its own way.

“Once the TPP becomes effective, European businesses in Asia will be substantially disadvantaged”

The EU inevitably needs to accelerate the speed of its FTA negotiations. Once the TPP becomes effective, European businesses in Asia will be substantially disadvantaged, especially because their American rivals will enjoy preferential market access. This is an urgent matter, given that ASEAN is the EU’s third-largest trading partner after the US and China. If the EU, like the US, decides to play a more constructive role in east Asian security, it will more easily gain concessions in its FTA talks since the agreements could act to reassure regional countries of stability. This is very much is Europe’s interest. Once east Asia, the globe’s growth centre, becomes unstable, Europe’s Asian linkages and economic benefits would soon feel the hurt, and the fate of European business people living in the region would be thrown into jeopardy.

One area in which the EU can play a uniquely constructive role is human security, which transcends national borders in the form of trans-national criminal networks or environmental degradation. Collective actions taken by regional countries sharing human insecurity threats can be more effective than actions taken individually. It’s thus no wonder that the EU has promoted human security cooperation. ASEAN likewise in the 2004 Vientiane Action Plan prioritised institutional coordination between relevant ASEAN bodies to promote cooperation on non-traditional security issues including trans-national crime. Those issues are now seen as important policy ingredients in the formation of the ASEAN Political and Security Community. While the EU and ASEAN have displayed different priorities and approaches in promoting human security, recent improvements in human rights and democratisation in some ASEAN members, especially Myanmar, may expand the EU’s scope for cooperation with ASEAN.

While economic interdependence in east Asia has been increasing, there are growing political tensions, a lack of partnerships between key regional states and little in the way of shared vision amongst struggles for power that have hampered the sound development of regional integration. The US has challenged this ‘Asian Paradox’ through its rebalancing strategy and push for the TPP. China has also defied it by establishing the Asian Infrastructure Investment Bank (AIIB), which with $100bn in capital has become pivotal in China’s version of a ‘rebalance Asia’ strategy, especially toward central and southern Asia. I believe the EU should also engage in east Asian stability in its own way and for its own interests.

IMAGE CREDIT: CC / FLICKR – U.S. Pacific Fleet

The post The EU cannot be a bystander on Asian security appeared first on Europe’s World.

In recent years, Europe has become involved the South China Sea issue. In the name of defending multilateralism and international law and order, it has repeatedly expressed concern. It admittedly has the right. But are these concerns based on fact?

I’d like to stress that the root cause of the South China Sea issue is the invasion and illegal occupation by certain countries of some of China’s islands and reefs. The Nansha Islands (often named the Spratlys) have been China’s territory for centuries. The Chinese people were the first to discover, name and develop them, and successive Chinese governments exercised sovereignty until 1939, when Japan invaded and occupied the Nansha and Xisha Islands (the Paracels). After the Second World War, these stolen territories along with Taiwan and the Penghu Islands were restored to China in accordance with the Cairo Declaration of 1943, and the Potsdam Proclamation of 1945.

“China is not going to undermine international law or reshape the regional order”

No one challenged that the Nansha Islands belonged to China until a 1968 survey conducted by an affiliate of the UN Economic Commission for Asia and the Far East (ECAFE) indicated the presence of rich oil and gas reserves. From the 1970s, the Philippines, Vietnam and Malaysia began to occupy China’s islands and reefs. They attempted to deny China’s sovereignty, arguing they had maritime jurisdiction because the islands were within 200 nautical miles of their coast. By doing so, they deliberately misled the international community. China is therefore the victim in the South China Sea issue. Nonetheless, in order to uphold regional peace and stability, the Chinese side has all along exercised restraint, handled the issue in a responsible and constructive manner, and committed itself to negotiation and consultation.

Another concern is the arbitration between China and the Philippines. On 23rd January 2013, the Philippines unilaterally initiated the arbitration, which is in violation of its agreement with China and goes against international law. The two countries agreed to seek a solution to disputes through negotiation and consultation. And according to its provision, the UN Convention on the Law of the Sea (UNCLOS) has no jurisdiction to interfere in sovereign issues without bilateral agreement. The unilateral initiation is a violation of the Convention (Article 280, 281, 283) and an abuse of arbitrary procedures. Chinese insistence against accepting or participating in the arbitration proceedings is an observance, not of a violation, of the law. No one should be criticised for taking lawful action.

As east Asia is becoming the centre of the global economy, the EU naturally has increasing political and economic interests in the region. There are voices demanding the EU be present in the South China Sea issue and ensure its security in the region if it’s to be an influential actor in east Asia. Thus it acted on 11th March by issuing a statement saying it does ‘not take a position on claims’ and also mentioned issues like regional militarisation, and the use or threat of force. The statement, between the lines, indicated China is the one disrupting regional security and threatening the freedom of navigation and overflight (FNO), but China and other coastal states are all committed to safeguarding such freedom through cooperation. Indeed, there has never been an FNO incident in the South China Sea. China itself relies heavily on these maritime routes to transport energy and goods. 80% of its energy imports and 40% of its goods are traded through the South China Sea. You could say quite fairly that no country needs the freedom of navigation more than China. ASEAN member states and China have agreed to work together to push forward the implementation of the ‘Declaration on the Conduct of Parties in the South China Sea’ (DoC), and the Code of Conduct (CoC) consultation is the right way to properly manage disputes and promote practical cooperation.

“No country needs the freedom of navigation more than China”

China is committed to peace and stability, and is not going to undermine international law or reshape the regional order. If Europe wants a China that clearly contributes to regional stability and development, it need look no further than the Asian Infrastructure Investment Bank (AIIB).

The EU champions itself as a fair and square mediator. But without looking into the historical narrative and basic facts of the South China Sea issue, how could it live up to being a responsible and impartial global actor? I should also note the fact that, as the most dynamic economic locomotive in east Asia, China is the EU’s indispensable friend and trading partner. EU interests lie in strengthening its Comprehensive Strategic Partnership with China, not taking a side on the South China Sea issue. All the facts told, the EU needs to decide for itself what choice to make.

IMAGE CREDIT: CC / FLICKR – U.S. Pacific Fleet

The post Europe has a choice on the South China Sea appeared first on Europe’s World.

The Council adopted conclusions on the completion of work on post-crisis banking reform. 

The reform has been undertaken by the Basel committee, a forum of supervisory authorities aimed at enhancing cooperation and improving bank supervision worldwide. 

"THE COUNCIL OF THE EUROPEAN UNION: 

REITERATES its support for the work by the Basel Committee to refine elements of the Basel III framework by the end of 2016 to ensure regulatory certainty, its coherence and effectiveness, while preserving the risk sensitivity of banking regulation. 

STRESSES the importance that the Basel Committee carefully assesses the design and calibration of this reform package, on the basis of a comprehensive and transparent quantitative impact analysis, taking into account in its global calibration also the distribution of its impact on the different banking models and across jurisdictions. 

NOTES that the reform package would not be expected to result in a significant increase in the overall capital requirements for the banking sector, therefore, not resulting in significant differences for specific regions of the world."

Justus Lipsius building - Brussels

• 08.00 - 10.00  Informal breakfast
• 10.15  Press conference by Federica Mogherini, High Representative of the Union, and John Kerry, U.S. Secretary of State (press room, level 00)

Access to the press room (level 00) will be subject to the following conditions:

• 6-month badge (2nd semester 2016). Badges can be collected from 11 July at the JL accreditation desk.
• Journalists without the above must send a written request by mail - deadline 14 July 17.00 - to press.centre@consilium.europa.eu, with a copy of their ID, a valid press card (if available) or a signed letter from their media confirming their professional status and that they are assigned to cover this event.
  No late request will be accepted.

Original documents need to be produced when collecting the badge.

Photos and video coverage of the event will be available for preview and download on http://tvnewsroom.consilium.europa.eu

Livestream on http://video.consilium.europa.eu