It has become something of a truism over the years to say that the Western Balkan region is often associated with war and animosity. Of course, it is true that ethnic tensions flare up from time to time as some leaders embrace nationalist agendas to cover up their own failings. Others, become increasingly authoritarian, undermining electoral processes and the overall state of democracy- as it is now happening in Macedonia where the Parliament recently called off the general elections scheduled for 5 June as most parties threatened to boycott the vote- criticising the government for failing to create a conducive environment for free and fair elections.
But it is not all doom and gloom in that part of the world. Kosovo is a prime example of a stubbornly pro-EU country where the aspiration for EU accession is pushing the country to transform itself. While Brexit supporters claim that the UK vote may have a knock-on effect on other Member States or even unravel the European Union as a whole, Kosovo is undertaking reforms to meet the political and economic acquis to join the Union.
Undoubtedly, Kosovo’s EU journey will be a long one, but great things have small beginnings. It recently signed a Stabilisation and Association Agreement (SAA), an important milestone for the EU-Kosovo relationship that will help the country continue much needed reforms and stimulate economic growth and job creation. Such agreements have already had a positive effect on other countries in the region, who have seen trade volumes increase by an average of 36% and trade deficits reduced by 4% within five years following SAA adoption.
Despite the many challenges facing the country, EU Commissioner Johannes Hahn praised Kosovo for ‘demonstrating its ability to deliver on key reform measures’ during the very first EU-Kosovo SAA Conference held in Pristina on 17 May. Kosovo authorities have had to make some painful decisions following recommendations from the EU and the international community. For instance, the government pressed ahead and reached historic agreements with Serbia in the face of strong domestic criticism and theParliament voted in favour of constitutional amendments to establish the Specialist Chambers, which will prosecute war-time crimes, hitherto a taboo for Kosovars.
Reforms are undoubtedly already yielding concrete results. On 4 May, the European Commission recommended waiving visa requirements for Kosovars, lifting them from isolation as all the other countries in the region enjoyed visa-free travel within the Schengen area. This would benefit Kosovo and the EU in a number of ways as collaboration in the areas of business, tourism, R&D, technology and education is likely to increase. More importantly, it will give Kosovars a sense of belonging and inclusion and send out a message of hope to a country that has witnessed so much despair.
This month, Kosovo has also a seen dramatic breakthrough in European and World Football associations, UEFA and FIFA. Sports diplomacy is exceptionally important for Kosovo as a means to consolidate its international standing and secure recognition by countries which have so far failed to do so. Ironically, if Kosovo qualifies for the 2018 World Cup, it will make its grand debut in Russia, one of the staunchest opponents of Kosovo’s independence. But such is the beauty of politics.
Albania is also a positive story in the region. Led by Edi Rama, a charismatic artist turned Prime Minister, Albania has seen great progress in the last few years. Indeed, EBRD ranked Albania as the country with the highest number of reforms in the region in 2014. Yet, the biggest challenge facing the current government remains the judiciary system, which Prime Minister Rama has vowed to reform this year. If he succeeds, Albania will likely start the EU accession negations. All eyes are now on him.
These achievements are, in part, thanks to EU’s ongoing involvement in the region. The traditional carrot and stick policy seems to have largely worked. The societies there are now safer, more open and more prosperous than a decade or two ago. Occasionally some political leaders do drag their countries to a political impasse or worse, but eventually the countries get back on track and reach a compromise, often facilitated by the EU. The Union provides a model for them that – despite its many failings – still lights their way. Let there be more EU engagement in the region, not less.
With a possible Brexit looming large on the political horizon, many energy companies, whether oil, gas or power, are becoming increasingly concerned about its negative impact on the UK and broader EU.
They argue that a period of relative stability in which the evolving EU energy market has made a significant contribution to ensuring security of supply, sustainability and lower energy prices, will be replaced by one characterised by greater risk and uncertainty. In addition, the reduced influence for the UK, would mean the EU would lose the weight of one of the key drivers behind energy market liberalisation. But are they right?
In terms of security of supply, the UK is increasingly connected to the continent. Thanks to the so-called gas and power interconnectors with France, Belgium, Ireland and Norway, a significant trade has now grown up and an increasing portion of the UK’s gas and power needs are supplied through these interconnectors. The European network codes, which regulate cross-border trade of power and gas through interconnectors, are crucial and complex issues will arise as to whether or not the interconnectors between the UK and the continent will continue to be bound by these codes.
It is also difficult to predict the extent to which the UK, in the event of a Brexit, will still be able to influence decisions around the development of these codes. Much will depend on whether the UK will negotiate to remain part of the institutions involved, including the European Network of Transmission System Operators and the European Energy regulator, ACER.
But there is now bona fide concern around safeguarding the continued development of new interconnectors, of which there are currently several in the pipeline. Significant up-front investment is required if these projects are to proceed. As all investors like long-term predictability – and Brexit is a major risk factor – investments in these projects could be seriously affected.
Another area of uncertainty relates to investment support by the European Investment Bank (EIB). In 2014, the EIB invested €7 billion into the UK economy and energy projects accounted for around 50% of that. Whether this type of investment will be possible post-Brexit is a real concern, and for those projects that have already secured funding, there is the possibility that a repayment may be demanded.
In terms of gas supply, the UK is increasingly dependent on supplies from Russia, both importing directly from Russia and indirectly via other European countries. Of course, the ultimate aim of the EU’s Energy Union is to loosen Russia’s stranglehold on Europe’s gas supplies by pooling resources. In the event of Brexit the UK would be more exposed from an energy security perspective in relation to Russia and, minus the UK, the position of the EU towards Russia would also be weakened. Of course, Brexiters are fond of asserting that the UK’s fossil fuel energy needs could be easily satisfied by, for example, shipping more gas into Britain from Qatar, but this does not stand up to critical scrutiny.
On sustainability, currently the UK adheres to the EU’s climate and energy policies, of which key elements are targets for 2020 and 2030 for CO2 reduction and renewables. Post Brexit it is unlikely that the UK would radically change its climate ambitions but, given the fact that the UK has never been a strong advocate for EU renewables targets, the abandonment of these targets may serve to undermine the investment climate for renewables.
As far as the EU’s Emissions Trading Scheme is concerned, the impact of Brexit would probably be limited. Given the fact that the scheme already covers emissions from three non-EU countries, and that the UK’s climate policies are inextricably to it, the most likely scenario is that the UK would remain within the Emissions Trading Scheme. The ability of the UK to influence how the scheme develops in the future would however be severely limited.
It has been claimed by Amber Rudd, the UK’s Energy Secretary, that energy bills in the UK would soar by £500 million a year after a Brexit. Many have however argued that this would only be the case if the UK leaves the internal energy market, and it is not clear to what extent that will be the case. What is much clearer, however, is that without the UK, supporters of energy market liberalisation within the EU will have lost a key champion, and European businesses and consumers are less likely to enjoy the cost benefits derived from increased competition and market liquidity.
The uncertainty and increased complexity that results from Brexit, and the marginalisation of the UK in terms of EU policy and regulation, will negatively impact on business in both the UK and EU. If it comes to pass, Brexit will need to be carefully managed if we are to minimise this negative impact. Conversely, a decision to remain inside the EU would create an opportunity for the UK, with support from likeminded countries, to positively reengage in Europe and more proactively push its energy liberalisation agenda.
At face value, this week in Brussels has so far been dominated by two fairly weighty and portentous developments for the future, namely the antitrust case against Google’s Android to be launched by EU Competition Commissioner Margrethe Vestager and, the High Level Meeting on Excess Capacity and Structural Adjustment in the Steel Sector convened by the Belgian government and the OECD in Brussels. Both of which bode ill for the future. But before we consider each of these in turn, let’s tackle the ever present elephant in the room – Brexit and the Obama visit to the UK at David Cameron’s behest to bolster his campaign to remain in the EU.
Strictly speaking, it’s slightly unorthodox to crowbar talk of Brexit into a Brussels column but who are we kidding? Let’s be frank, between now and the result of the referendum: Brexit is the only game in town on both sides of the Channel. After all, this was the week that saw Pier Carlo Padoan, the Italian Finance Minister, declare that ‘’Brexit is a major threat to Europe’’. Even our very own dog-eyed ‘’capo di tutti capi’’, Jean-Claude Juncker, came out bemoaning the EU Commission’s insufferable habit of interfering in the life of the ordinary citizen. And all that with a straight face!
The crux of the Brexit matter this week surely has to be that if the British Prime Minister and de facto leader of the Remain camp, David Cameron, is monopolising the President of the U.S for three whole days, then both gentlemen must have some serious concerns about the direction the Remain campaign is heading in. The likes of Messrs Farage, Gove and Johnson are already smelling blood. Cries of ‘’Frit! Frit!’ emanating from the green benches in the House of Commons cannot now be very far off.
As a self-confessed supporter of the Remain camp, I couldn’t help but worry when I heard Lou Susman, former US Ambassador to the UK, say this week in reference to the President’s upcoming UK visit, that ‘’we want to do whatever Cameron thinks will help him win this vote but of course, it is entirely up to the British people which way they vote.’’ My compatriots outre-manche can be a contrary and bloody minded bunch at the best of times and I am not convinced that David Cameron basking in the reflected glory of President Obama will necessarily have the desired effect domestically speaking. Especially if the President goes into his hectoring professor routine. Brits don’t react well to the wagging finger of foreign leaders as history will attest.
Which brings us back to steel, Port Talbot, state aid and Tata Steel. The week began with UK Business Secretary Sajid Javid coming to Brussels to attend the High Level Meeting on Excess Capacity and Structural Adjustment in the Steel Sector and ended with Her Majesty’s Government declaring a willingness to take a 25% stake in any rescue of Tata Steel’s UK operations. Let’s just hope for the sake of the Remain campaign that EU Commissioner for Competition Margrethe Vestager is kept busy with Google between now and 23rd June otherwise any untimely intervention on the merits of state aid could edge the UK electorate ever closer to the exit door. But I’d imagine Jean-Claude has already dispatched Jonathan Faull to nip that particular ‘’miscommunication’’ in the bud and make Margrethe an offer she cannot refuse.
As for Google, they seem to lurch from one crisis to the next in Brussels with apparent abandon. If the UK were to exit the EU after the UK referendum on EU membership in June 2016, then you can bet your bottom dollar that US tech companies will face even more problems in Brussels as British MEPs, Commission officials and the UK’s Permanent Representation to the EU would no longer be a moderating influence on some of their more protectionist and privacy fixated continental counterparts in Brussels. If I were Mark Zuckerberg, I’d be whispering in my President’s ear before Air Force One touches down in Blighty.
I live in what is called the Pentagon: the centre of the city of Brussels. Not the EU quarter, but downtown in the heart of what was the medieval city. 10 minutes on foot, on the other side of the canal, is the Molenbeek. From my window I can see Molenbeek town hall in one direction and, in the other, the Hotel de Ville on the Grand Place.
It’s just after 10:40 CET here and sirens are wailing in my neighbourhood and the loud-hailers are sounding on police cars again. It’s been quiet since 9:00. The police seem to be going over the bridge into the Molenbeek in one direction and heading up to Gare du Nord in the other. Police raids I assume, but how can you be sure?
At about 8:30 there was a commotion at the end of the square where I live. No idea exactly what happened; woman screaming loudly in Arabic, loads of unmarked police cars with only the flashing blue lights to give them away whizzing around. Then some police vans arrived and released police dogs out into the streets. Police cars shooting off every which way in all sorts of directions.
After 15 minutes of intense activity, they all sped off and it was back to silence. All I could hear was the police loudspeakers in the adjacent neighbourhood but couldn’t quite make out what was being said.
The raids and cat and mouse game have been going on in my neighbourhood since November with periods of varying intensity. After a few months, you grow accustomed to it and you put your head down, keep your chin up, and carry on. You stay off of public transport and you keep a constant eye on those you love and care for.
Beyond that, what can you do?
Author: Eliot Edwards, Director of Public Affairs, Aspect Consulting
At the time of writing, prior to the referendum result in Greece being known, an unreal atmosphere pervades Brussels as it swelters beneath Mediterranean skies and those working in government and public affairs struggle to come to terms with the potential ramifications for the rest of Europe stemming from Alexis Tsipras’ shock announcement to call a referendum last weekend.
The adjective ‘’momentous’’ is one much overused by political journalists but this week has been an exception to that rule. Events unfolding this week in Athens and Brussels around the long heralded Grexit, truly have been momentous. Developments are unfolding at such a breakneck pace that the media is having problems keeping up with reporting them as the opposing parties brief and counter-brief against one another as blame is attributed as to who bears ultimate responsibility for the negotiations breaking down.
It’s fair to say that most people in the Brussels village hope that the Greek people ignore their Prime Minister’s exhortations to return a ‘’No’’ vote but sadly that’s only so much wishful thinking. Time and again since Syriza was elected by the Greek people, it seems that Brussels, the ECB, the IMF and Berlin have consistently misread the coffee grinds when it comes to second guessing Greece and its government. When on Monday of this week the President of the European Parliament, Martin Schulz, announced that he would travel to Greece to personally campaign for a ‘’Yes’’ vote, one couldn’t help but feel that Brussels still does not quite get it.
For now, the spectacle of a fast approaching Grexit has knocked talk of a possible Brexit off of the Brussels agenda but everyone within the Brussels Bubble knows that the respite is only temporary and more uncertainty lies ahead just around the corner. This week, the only game in town until next Sunday evening will be predicting the result of the 05th July Greek referendum. Whatever the result of either referenda, what does it say about the current state of the EU that the political leadership of two very different member states, feel they have no alternative but to consult their respective peoples on how to define the nature of their countries’ future relationships with the rest of the community? However ambivalent one might feel towards either Syriza or the Tory party, surely something is profoundly amiss at the heart of the EU if it has come to this.
One cannot help but feel sorry for Jean-Claude Juncker when it comes to having to intercede between David Cameron and Alexis Tsipras, on the one hand, and the other heads of state, on the other. It must be a thankless task. It all takes one back to the heady days of the inauguration of the Juncker Commission last November when the man himself declared that ‘’unless we get things right, we could be presiding over the last ever EU Commission’’. A claim that seemed overblown hyperbole at the time but, in retrospect, now appears perhaps eerily portentous. Let’s hope not.
Whatever one thinks of Jean-Claude Juncker, one cannot deny that the man has tried hard to embrace change since assuming the presidency of the Commission. The condemnatory tone Juncker adopted when delivering his verdict on Alexis Tspiras and his Finance Minister Yanis Varoufakis this week behind closed doors to the EPP Group at parliament, whilst not diplomatic was a sincere reflection of the exasperation this old Brussels hand feels in the face of the two ‘’upstarts’’’ deliberate refusal to play the classic Brussels game and at least try to do things by consensus.
One cannot help but feel that something profound has changed in the way business is done in Brussels. Lessons urgently need to be learned from the handling of the unfolding Greek saga if the UK referendum is not to inadvertently end in catastrophe. The advice this Europhile Brit would give Mr Schulz would be to please stay put in Brussels and not cross the Channel to campaign however much his heart might be in the right place.
Author: Eliot Edwards, Director of Public Affairs, Aspect Consulting
Also published on: http://www.publicaffairsnetworking.com/news/vox-populi-vox-dei-
The last week has been portentous for the future of Europe. In fact, it’s hard to remember a time in recent decades when the continent’s political leaders were faced by so many weighty headline issues competing for their urgent attention. ‘’Europa in seiner schwersten Krise seit Jahrzehnten [Europe in its most difficult crisis in decades]’’ read the Bild in Germany this week. And for once, the tabloid could be forgiven for its hyperbole.
German tabloids are not alone in their angst. Dutch Finance Minister Jeroen Dijsselbloem, the President of the Eurogroup, said at the start of the week that the time available for a Greek request to extend the existing bailout package was running out, insisting that ‘’We can use this week, but that’s about it’’. At the end of the week, however, the Syriza government seems no more inclined to extend the bailout package, even despite pressure exerted on Athens by US Treasury Secretary Jack Lew.
Germany vs. Greece: still 0-0
There has been much speculation in the European press that the profound personality clash between German Finance Minister Wolfgang Schäuble and his Greek counterpart, Yanis Varoufakis, could produce fireworks at today’s (Friday) third meeting of the Eurogroup in Brussels. Considering that on Thursday the German government rejected the letter Varoufakis had submitted to Dijsselbloem on Wednesday requesting a six-month extension of its Eurozone loan programme – instead of renewing the existing bailout deal – chances of a clash are not inconceivable.
What with the Eurosceptic Alternative für Deutschland(AfD) party having won its first seats in a regional assembly in western Germany in Hamburg last weekend and a recent TV poll conducted by ARD television channel delivering a result of 41 per cent of viewers wanting Greece out of the Euro, Schäuble cannot afford to be seen domestically as a ‘’soft touch.’’ Worryingly, from a German perspective, it is no longer clear whether the European Commission and Berlin, as Greece’s biggest creditor, are on quite the same page following events this week.
Friends, foes and forgotten
The rollercoaster negotiations between the new Syriza government in Greece and the Eurogroup might have captured everyone’s attention in the ‘’Brussels Bubble’’, but from Mitteleuropa to all points east on the map, it was the question whether or not the new ceasefire in eastern Ukraine would hold that was more on people’s minds. As ever, the Bild newspaper captured the contemporary Zeitgeist in Germany with its overblown headline on “Der Russe oder der Grieche: Wer ist gefährlicher fur uns? [The Russian or the Greek: who are the more dangerous to us?]”.
Once again German Chancellor Angela Merkel and her government have proved to be at the heart of those momentous events as the de facto leaders of Europe since the financial crisis began to bite Europe (if ever there was any doubt). Even more glaring, however, was David Cameron’s absence in diplomatic efforts to mediate between Russian President Vladimir Putin and Ukrainian leader Petro Poroschenko. Some commentators both in London and Brussels have noted this week that the current Ukrainian and Greek crises give an unpalatable foretaste of what life might be like for the UK post-Brexit, with Britons having to get used to seeing their country being on the margins. In some quarters in Europe, the perception is that Britain has already begun its withdrawal from the continent.
Author: Eliot Edwards, Director of Public Affairs, Aspect Consulting
Also published on: http://www.publicaffairsnetworking.com/news/fog-in-channel-continent-cut-off
There is something about the number ‘10’. People make top ten lists; the pop charts focus on the top ten; 10 is the number Lionel Messi wears – as did players like Platini and Hoddle. And for the rugby fans, your 10 is the man that should run the game. Oh, and the Prime Minister of Dear Old England resides at No. 10.
This month, ‘10’ is a special number for Aspect. We are now (cue drum roll…) 10 years old. Difficult to believe if you are part of it, but we have been providing communications and advocacy advice to some of the world’s largest companies facing some of the toughest challenges for more than a decade.
What has changed? Well, speaking at least personally, we are all a little older, greyer and fatter. And wiser too, I dare say. Ours is the type of job where you really do learn, if not every day, then certainly every project. Not only because every client and every situation is different, but also because the world is a dynamic place.
10 years ago social media did not have the all-consuming relevance it has today. No-one had ever knowingly used the word ‘austerity’ in public discourse. The music was still playing so bankers were still dancing. The world is probably a little less secure, a little more tense, and feels less prosperous than a decade ago. Half of our decade has been taken up with the worst recession for a century.
But Aspect Consulting is still going strong. Like every SME, we have our good years and bad – but we are entering our second decade in fine fettle.
On behalf of the management of Aspect, I have many people to thank. Superb, loyal clients – who are the basis for everything else. We have been fortunate to work for some wonderful people. We have also enjoyed the support of some great suppliers and business partners, all around the world. They too have been a part of this journey.
Our wives, husbands and partners have had to endure those good times and bad times, and they too deserve my recognition. Only they know how important they are.
But my biggest thanks go to all those who work, or have worked, in Aspect. One of our staff once signed off an all-office email with the phrase “Proud to be an Aspectonian”. I am proud of all those who have played a role, larger or smaller, in creating the small, but perfectly formed history that is Aspect. And I thank them all.
As the saying goes, here’s to 10 more years. What stories will we tell in 2024?
Author: James Hunt, Founding Partner of Aspect Consulting, on the occasion of Aspect’s 10 year anniversary celebration at the BELvue