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G20: Europe risks losing its relevance

The euro crisis is will be a central topic at the G20 summit in Mexico. The EU will have to defend its rescue management strategies and fight to keep its position in the club of the world’s most powerful and influential.

The euro debt crisis is likely to dominate the talks of the 20 most important industrial and emerging nations that are coming together on June 18 and 19 in Mexico. Expectations are high. Players on the global financial markets will be watching particularly closely, to see if the G20 comes up with sustainable answers to the crisis.

The high-ranking EU participants will have to demonstrate their ability to act and their decisiveness. The longer Europe struggles with the crisis, the more the world questions Brussels' assertiveness. Officially, the G20 will discuss the financial crisis; unofficially the EU's image is at stake. The European Union has to defend its position as an economically and politically relevantl institution in the global power matrix.

EU's sinking star?

Almut Möller has to answer questions on Europe's loss of power

Almut Möller has to answer questions on Europe's loss of power

Since the beginning of the financial crisis, Europe hasn't exactly proven its credibility, Almut Möller from the German Council on Foreign Relations (DGAP), told Deutsche Welle.

"Europe's loss of power is a reoccurring topic in discussions" with partners outside the EU, she said. They ask whether the Europeans are in a position to resolve the crisis at all. It's this lack of trust, the political scientist believes, which is the EU's major obstacle during important international summits. "Summit participants see it this way: The star of the European Union has barely started to rise, when it's already starting to sink again". This makes it hard for the EU to push through its beliefs on the political level, Möller argues.

Another major obstacle is the lack of unity within the EU. Partners abroad have difficulty disentangling the various interest fields of EU decisions and the sometimes opposing interests of individual member states. This gives new relevance to the famous quote by former US Secretary of State Henry Kissinger. When asked about Europe he said he didn't know who to call, because Europe always talks with several voices, instead of one.

Non-Europeans are confused

The EU doesn't come across as a geopolitical unity, says Professor Ludger Kühnhardt from the Center of European Integration Studies at Bonn University. He told Deutsche Welle that Europe was "selling itself poorly on the international stage on this question; and incidentally, in many other areas as well".

Kühnhardt said that at the G20 summit, Europe will again be represented by high-ranking EU officials as well as officials from individual EU member states. "To any outsider – in particular emerging powers like Indonesia, Latin America and South Africa – this is a confusing picture. And it's not helping when trying to convey the desired image to the G20 participants that Europe is a continent which has unified individual states." Kühnhardt pointed out that scientists and politicians have been demanding for years that the EU send one single representative to G20 summits and not allow additional representation by individual member states.

Angela Merkel wants Europe to be a political union

Angela Merkel wants Europe to be a political union

German Chancellor Angela Merkel has drawn her own conclusions from the discussion. With her call for "more Europe" she decided to seize the initiative; a clear indication of just how threatening she perceives the European crisis to have become. Speaking to the German press she repeated her call for a fiscal union. Earlier this month, she used unusually frank words when pushing for more political union. "That means we have to transfer competencies to Europe step by step and give Europe instruments of control", she said.

Common European solutions

She timed her plea carefully. She had to increase pressure because, not only is the G20 meeting coming up, but this weekend also sees fresh elections in Greece. The vote could well determine whether or not the country has to leave the euro zone – a historic first. In late June, EU leaders are coming together for their next summit, where they hope to pave the way for important measures to solve the financial crisis.

The G20 participants at the summit in Cannes in November 2011

The G20 participants at the summit in Cannes in November 2011

"More Europe is the right strategy", said Professor Kühnhardt, adding that the origins of the crisis can be found at the national level, and so, the solutions can only be found within the European Union. Almut Möller from the DGAP also believes in more political union. But she remains skeptical whether all EU member states agree, especially because it would mean transferring competencies to Brussels.

"If you put national states under pressure then their gut feeling is not to pass on power. Because that limits their responsibilities, their sovereignty and their independence," she stressed. National states, she added, are currently busy dealing with the effects of the euro crisis at home, and so they tend to see the national rather than the bigger picture.

EU needs to show self-confidence

Professor Kühnhardt calls for more self-confidence

Professor Kühnhardt calls for more self-confidence

In order to calm the markets and to take the wind out of the sails of those who reject the European idea the EU has to demonstrate determination and unity at the G20 summit, says Kühnhardt. But if the EU wants to be convincing in Mexico it needs to show more self-confidence than it has done so far, he notes, because "Europe often portrays itself weaker than it is". According to the professor, Europe has every right to demonstrate strength, provided it manages to portray itself as a true unity.

He sees justification for this claim in trade relations with Africa, for instance: China and the US together have a trade volume with Africa of some 100 billion dollars. The EU's member states combined have a trade volume of some 250 billion dollars. "If we add our numbers we're the strongest power", said Kühnhardt. And that also holds true on the political front.

"If Europe is only perceived as the summation of individual states, of course we fall back in comparison with emerging nations." Which, according to Kühnhardt, have a much larger and younger population that is pushing for more consumption, spending power, improved living conditions, and technological progress, while Europe is aging.

But if you combine countries' potentials, possibilities and the common positive image, Europe remains "together with the US, the world's most important power with the highest influence", Kühnhardt added. "We often portray ourselves worse than we are because we don't have a common EU government, which actually deserves this name."

Author: Ralf Bosen / nh
Editor: Gregg Benzow

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