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Europe

Ireland Outlines EU Presidency Goals

Following the EU’s failure to approve a new constitution and the effective suspension of the bloc’s budgetary rules, Ireland has decided to take a cautious approach during its six-month presidency starting next year.

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The spotlight will be on Irish Prime Minister Bertie Ahern when he takes over the EU presidency on Jan. 1.

Irish Prime Minister Bertie Ahern will have a full plate when he takes over the reins of the European Union from his Italian counterpart Silvio Berlusconi on January 1, 2004. Italy’s EU presidency was marked by discord and strife within the 15 member bloc.

In particular, disagreement over the breakdown of crucial talks on the EU’s future constitution last weekend and the tattered deficit rules of the euro’s stability pact will cast a shadow over the coming months. Add to that the EU’s upcoming enlargement in May when 10 countries will join the bloc and Ahern will have more than enough to keep him busy.

Outlining Dublin’s plans for the EU in the first half of next year, Irish Foreign Minister Brian Cowen said on Thursday Ireland would place high priority on tackling the issue of the deadlocked EU constitution talks that pitted Germany and France against Spain and Poland.

"We’ve had a disagreement. We’ve had a disappointment. We’ve had a setback," Cowen said. "I have no doubt there will be an agreement. It’s a question of when rather than if."

Valéry Giscard d'Estaing

Mr Valéry Giscard d'Estaing,

Cowen’s cautious tone was echoed by Valery Giscard d’Estaing (photo), former French president and steward of the EU draft, who for the first on Thursday publicly weighed in on the debate over the failed summit. Giscard called the collapse of the summit "a great missed opportunity" and said he did not expect negotiations to resume until late 2004 or early 2005.

"A precipitous move, instead of producing (agreement) would probably reinforce antagonisms, so it would be better to have a prudent, cautious approach," Giscard said. "It would be very unwise to set new deadlines. Things have to be given time to mature," he added. Giscard also for the first time publicly disclosed that he had favored a higher population threshold for majority voting in EU decision-making, but had been overruled by his peers.

EU budget a worry

Though the constitution is expected to dominate discussions in Brussels for the next several months, the Irish will also have to deal with the debate on the EU’s 2007-2013 budget next month and ensure it does not degenerate into a shouting match between net contributors to the budget and net recipients.

The risks have already been heightened with Germany and other net contributors suggesting the EU budget needed to be capped, a move that would penalize Spain and Poland, two big net beneficiaries of EU aid that are blamed for blocking the constitution treaty. Both countries refused to accept the draft that would decrease their voting rights in an enlarged EU.

"The problem with non-agreement on the constitution is that more and more issues get fed into the financial perspectives debate," Cowen said in an interview with the Financial Times.

Enlargement and euro rules

Enlargement presents a further challenge to the Irish government, as it takes over the running of an EU poised to expand to 450 million people on May 1, 2004 when 10 new mainly former communist countries join the existing 15 members.

Ireland is the model of the benefits that EU membership can bring, since the tiny island nation has moved from being a poor net recipient when it joined in1973, to a thriving, net contributor to the EU budget with some of the highest growth rates in the bloc.

Another sticking point remains the Stability and Growth Pact that underpins the euro. Cowen said on Thursday that the existing fiscal rules that limit budget deficits contained enough flexibility and had been appropriately applied on the deficits of Germany and France. "Of course we all support the application of the rules of the pact, including the excessive deficit procedure," Cowen said. "In our view, the rules contain an inherent flexibility and it’s appropriate that this flexibility be applied with common sense and consistency."

Apart from tackling the obvious hurdles ahead, Ireland has said its priorities will be to boost economic reform and competition in the EU, job-creation and crime-fighting. "Competition, growth and jobs. Those are the questions, according to which our citizens correctly judge the success of the European project," Cowen said.

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