Emmanuel Macron’s verdict on last week’s EU summit may surprise those who the saw the Brexit talks deadlock as Europe’s defining challenge. “This summit was a test for Europe and we have passed that test,” the French President proclaimed as the leaders signed off on two hard-fought agreements every bit as crucial to the union’s future, a €1.8 trillion budget and coronavirus recovery package, and a pledge to reduce carbon emissions in the next decade by 55 per cent.
The Brexit talks got all of ten minutes of the leaders’ attention, a brief state of play report from Commission President Ursula von der Leyen, and a firm rejection of requests from UK Prime Minister Boris Johnson for separate bilateral talks with Macron and German Chancellor Angela Merkel. Unity behind chief negotiator Michel Barnier and his red lines is unshaken.
Yesterday’s agreement to go on talking does not, however, make agreement any more likely.
Crucially, the leaders were able to see their way through the budget stand-off that threatened to hobble EU spending within days, but without compromising on the majority insistence that funds will be clawed back from states which do not respect the rule of law. Polish and Hungarian vetoes were withdrawn on the basis of a face-saving non-binding declaration assuring them they would not be unfairly singled out. The declaration also makes clear that member states can challenge the legality of the rules at the Court of Justice of the EU before they are applied. Such “clarifications” have been used in the past by countries like Ireland to overcome domestic objections to controversial treaty provisions without necessitating changing the provisions.
Diplomats insist the substance of the rule-of-law legislation remains unchanged, echoed by leading MEPs who have endorsed the deal. The agreement marks not only the freeing up of seven-years’ spending, but the launch of a radically new collective crisis response based for the first time on massive EU debt issuance. It is an important tool to help recovery from the pandemic that can take economic union to a new level.
The leaders again demonstrated that the EU’s unwieldy unanimity voting is not, appearances to the contrary, an insuperable barrier to decision-making. But the issue of reform does not go away, and the very possibility that the union might have explored cutting reluctant Poland and Hungary out of a special 25-state recovery fund may have concentrated minds usefully.
That agreement should also be reached on raising the level of the EU’s climate emissions ambition, also blocked until now by Poland, is very welcome. The more frugal states will note with some regret that the price will be a substantial compensation fund for those in transition from carbon-based economies. Unanimity is costly.