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Transforming for Survival: Europe in the Face of Change

0 Comments 🕔08.Jul 2016

by Thomas Henökl

While markets are diving and uncertainty is spreading, many are tempted to say, “Yep, told you so. Now look what you’ve done!”

Now Europe must look ahead to prepare for change and reform of social and economic policies, domestically as well as internationally. One question yet to be answered concerns the consequences of the island-vote for the EU Global Strategy.

The British have expressed their will to walk out on the EU, with a narrow majority of 52 percent. The “leave” votes were concentrated in England and Wales, while a large majority in Scotland and Northern Ireland chose to remain in the EU. More older Britons, rather than younger ones, were in favor of Brexit.

The Union is saddened to see the Brits leave, taking the island vote as a wake-up call to addressing problems of frustration and resentment that led a majority of the Englishmen and Welsh to say farewell. It was a tough and dirty race that kept us thrilled for months. Instead of licking our wounds, we must get back to work and provide answers to a whole lot of domestic and global threats.

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A resilient Europe urgently needs to re-appropriate and regain control over the agenda, as well as make a number of critical adjustments to solve the simultaneous internal and external crises. We may indeed need Eurobonds and the mutualization of debt, in addition to reform of social and economic policies, in order to defuse the ticking bomb of inequality and exclusion in our societies, which otherwise may blast right in our faces in the form of hatred, xenophobia, radicalization, and violence. There is a lot of homework to do for both the EU institutions and the member states—and it was due a week ago.

Internally, sustainability perspectives and fairness focus are cross-cutting themes that concern all policy areas and portfolios. Inequality issues within and between countries are threatening the social cohesion of European states, let alone the Union. We need to counteract now for a long-term stabilization of societies, in order to contain and repel risks of institutional failure and societal decomposition, which we see coming closer to Europe. There is no more comfort zone to withdraw to. Honing in on these issues, tackling these existential threats of global warming, extreme inequality, erosion of legitimacy, and breakdown of livelihoods is simply not optional. It has to be crystal clear to everyone around that we cannot give up on these. And we must not leave anyone in doubt that we are committed to live up to the challenge.

Externally, we must make sure that EU’s Global Strategy (EUGS), presented to the Heads of States and Government at the meeting of the European Council on June 28 and 29, is implemented in the spirit of worldwide engagement and global public goods orientation. The text tabled by the EU High Representative for External Action makes clear reference to the overarching sustainability and cooperation goals, as formulated in the UN 2030 Agenda for Sustainable Development. With this endorsement, the Sustainable Development Goals (SDGs) of 2015 ought to determine a clear sense of direction for the EU’s international relations. As a result, the development community should no longer be required to permanently negotiate problems of competence distribution and positioning within the wider array of the EU’s external policy instruments.

Equally important, the image we project to the outside world reflects back on us. If we are not up to the challenges around us, the EU loses its legitimacy and its reason to be. And the challenges are real; global warming, crises and chaos, failing states, collapsing livelihoods, and societal disintegration are happening right at our doorstep. To give our children a chance for survival, we must act. Now.

We need to set a broader and bolder agenda of how to break down and implement the SDGs, and how to lay the foundation for a much needed fair and effective global common goods policy—able to confront the existential threats that Europe faces today. In addition, Europe lacks a vision of how it wants to achieve its long-term objectives of peace, freedom, and prosperity—at home and abroad. A new “European Consensus for Development” is not only an opportunity to move ahead in the consolidation of coordinated EU development policies, at both member state (MS) and European levels. It is also necessary to update the framework for action after the Lisbon Treaty from 2009, since the “old” Consensus still reflects the previous legal basis.

This “old” EU Consensus for Development from 2005 was formulated against the background of the Millennium Development Goals (MDGs), and aimed primarily at poverty reduction. However, the 2030 Agenda creates a necessity for broadening the goals spectrum, and increasingly moves the focus towards global challenges. In addition, the ongoing differentiation in cooperation at the bilateral level has raised new questions regarding the role of development cooperation in fragile states and in crisis situations. Another factor is that the Consensus concentrated primarily on the aid effectiveness agenda and the contribution of the EU. The aid effectiveness agenda, as resolved in the Paris Declaration of 2005, however, gradually moved into the background, and we may have to question whether it still plays a major role in today’s EU development cooperation.

To be able to give a positive answer to this question, a much broader and bolder approach, going way beyond poverty eradication, is needed; a larger vision, not only to solve the most pressing issues and burning questions, not only focusing on mitigating short or medium term goals or aspects, but also a holistic development policy, one that acknowledges all aspects of sustainability as a condition for stability, social justice, and democracy. What is also required here is the clear and timely positioning of European development cooperation in the broader field of EU public policy. A new paradigm of vertical and horizontal policy coherence for sustainable development (PCSD) would place the above mentioned agendas right at the heart of EU decision-making, whereby development policy is reflected to its full extent in all of EU action, internal and external. Close coordination with and among Directorate Generals for Trade, Neighbourhood (NEAR), Energy, Climate, Agriculture, Research, the European Humanitarian Office (ECHO), and of course, the European External Action Service (EEAS), including its Common Foreign and Security Policy (CFSP) structures, should be institutionalized and formalized beyond the vague duty of bona fide administrative cooperation.

EU institutions and member states need to improve and tighten the coordination between both governance levels (MS and EU) and between government sectors. In light of the present challenges, the ambitious goals of the 2030 Agenda, as well as the COP21, require a “whole of government approach,” (WoGA) crossing departmental borders and reaching from the member states’ diverse administrative layers up to the EU hierarchies—and beyond that, linking with the global governance structures of the UN system, G20/G7, or regional partners in all corners of the world. Only a joined marathon effort of a truly global nature may endow us to mobilize the means to counter the threats and disruptive tendencies, we now very clearly see coming at us.

With its institutional experience regarding Policy Coherence for Development (PCD), the EU should now aim for Policy Coherence for Sustainable Development (PCSD). PCD has been institutionalized as a central policy goal in the EU since the Treaty of Maastricht (1992), reiterated and spelled out in the European Consensus on Development (2005), and further strengthened in the Treaty of Lisbon (2009). Over the years, several reports have been published by the European Commission and the Organization for Economic Cooperation and Development (OECD). In parallel, the EU had a leading role in the initiation and negotiation of the SDGs, setting the global agenda for cooperation post-2015. National and international donors, among them the EU, as well as a number of EU member states, have launched their own investigations into improving cross-sector and cross-level coherence, to the benefit of effectiveness and results. The conclusions from these reports and academic research are diverse, but results point to the fact that successful (positive) policy coherence resembles whole-of-government approaches, where administrative hierarchies from all policy sectors are bound and coupled together in the pursuit of a set of overarching objectives, namely the SDGs. The view suggested here conceptualizes PCSD as the effort of addressing a three-dimensional coordination paradox: 1) horizontal and 2) vertical PCD, i.e. cross-cutting policy sectors and spanning various levels of governance; together with 3) a “forward” orientation to meet a number of identified, “real world” needs and agreed-upon development goals. If we add the movement along various timelines, such as the evolution of problems and issues, electoral cycles, changing policy priorities and agendas, sequencing of decisions, contingency, and the sheer duration of reform measures to show results, PCSD also has a dynamic component of permanent re-evaluation and adjustment. This involves political will, guiding policy orientation from the executive top of governmental (incl. EU) hierarchies, commitment of resources (manpower and expertise), constant coordination, and tight coupling of diverse administrative layers (also between EU and member states) to jointly work in pursuit of one set of goals, as well as regular review and optimization.

In practice, it is generally agreed upon that synergy effects can be expected in the areas of conflict resolution and crisis management, concerning many different aspects, particularly in intricate political and socio-economic contexts where these policy fields are closely interrelated: Without security, comprising the dimensions of traditional and non-traditional security issues, as well as human security, beyond the immediate absence of violent conflict, it is impossible to create sustainable development and public welfare. On the other hand, in order to create lasting peace and stability, it is also necessary to build resilient communities, maintaining economic activities to sustain the livelihoods of local populations. Equitable trade in turn increases the chances for prosperity, while at the same time peace and a certain economic level are necessary to enter into a fair and mutually beneficial exchange of goods and services. Finally, states, societies, or ethnic groups tied together by trade relations, enabling and securing the livelihoods of their populations are also less likely to resort to violence to manage social or political conflicts, and to fall victim to fragilization or institutional failure. The specific challenges lie in ensuring policy coherence, and at the same time guaranteeing the prerogatives and independence of development and humanitarian policies.

Insights gained by the research on root causes of flight (Grävingholt and Schraven 2016), unambiguously show that a combined and sustained effort of conflict prevention, crisis management, and development policy is required if we are serious about addressing the issue—and we better be, since the political and social transformation, which has gained a whole new dynamic since the Arab Spring in 2011, are not reversible. And we may only see the beginning of it.

At the same time, we also need to understand the demographic benefits of migration for Europe, where in many countries we face aging and shrinking societies. Newly arriving people should be seen, first and foremost, as individuals or families who represent a resource—a human, demographic, economic, and creative resource, and as one crucial facilitator contributing to economic and social development here, and then, in case they return at a later stage in their home countries.

A necessary (but not sufficient) condition for integration of people in host countries is to let them take part in cultural, social activities, and also in work life. We should provide education and equip them with the skills and training to create values and earn their living, as well as (self-) respect in their new environments. We need to help them build the basics of their own subsistence, and learn to appreciate the added values these people can create in our societies.

What else can we do in third world countries? We can offer generous tax benefits for the private sector engaging in co-financing projects; practically facilitate engagement of non-governmental actors; improve the framework conditions for such engagements, and signal tis is the “new cool” or the “new deal,” by giving latitude, encouragement, and providing services (trade representations, embassies, p2p activities, strengthening interconnectedness of civil society—see the lessons learned from ASEAN in this respect), but also by increasing the moral pressure (“nudging”) on those who earn from production and access to markets or resources, to take care of a share of the bill for building societies. In general, economics would teach us that value is not a cake limited in size (except by the planetary boundaries which we are approaching). Rather the opposite: in principle, the profit or value is unlimited (if we engage in sustainable production and consumption patterns) and increases by more productive forces contributing to value creation. In short, the more people are baking cake, the more cake there is to share.

The EU could further consider applying ideas from its own internal cohesion policy in upper middle-income countries, and call for co-financing of mutual-benefit projects, as another option to using grants or loans financed through ODA. Beyond that, more advanced forms of mutual engagement should replace cooperation programs, so that the EU stays involved with these countries: next to trade and investment, one could think of partnerships in research and education, facilitating mobility of academics or professionals, administrative twinning or exchange schemes, city partnerships, open policy dialogues in diverse fields according to the countries’ needs and capacities. These could include health, environment, climate, energy, and green growth, sustainable production and consumption patterns, inequality, and urbanization. Strategic partners should also be met at eye-level to engage with the EU in efforts of orchestrated global governance, as in building or reforming international institutions and regimes in a development-friendly way.

Organizationally, the EU institutions need to further the cooperation with and among EU member states, concentrate on LDCs, and seek to increase its performance in ensuring broad-based ownership of development cooperation programs. Recent evidence from research demonstrates a recentralization of development cooperation at the EU level, whereby headquarters overrules agreements reached between partners and EU Delegations. In order to strengthen aid effectiveness and local buy-in, increased devolution of responsibility for programming and implementation to the EU-delegations and their partners in host countries is highly recommendable.

Donors should contribute to increase augment the income base of developing countries by also helping them to earn and to extract revenue from those who have resources to spare, next to providing and co-creating business models, sustainable investment and engaging in knowledge, technology, and skill transfer.

We should also encourage and, if necessary, enforce that companies pay taxes in the countries where value is created. A recent agreement at EU level goes in that direction. This would liberate an enormous potential for struggling societies, where large parts of the population still live in poverty.

Inequality is a key variable in the equation: The more you eliminate structural inequality (either directly in a redistributive way, or by means of education, knowledge and skills transfer, female empowerment and fostering women entrepreneurialism via micro-finance or other targeted means), the higher your chances of creating participative, open, democratic, just, equal, and free societies. Priority should be given to women, since their emancipation and participation in all areas of life have shown to have the strongest impact on social and economic development. Another crucial instrument is allowing for geographic (and social) mobility, which may work as a channel for transfer of societal knowledge (e.g. concerning gender issues and relations between men and women). Allowing for a direct experience of an open society in Europe will have positive repercussions by means of “travelling ideas.” This can certainly also be leveraged by educating and sharing knowledge (exchanges and interconnectedness, preferential mobility schemes for certain societal groups, such as minorities, least-advantaged but also youth, opinion-leaders, key players, and strategic partners) and thereby to multiply its impact.

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What does the impending Brexit mean for European foreign and development policy? The only thing that is certain at this time is that the coming weeks and months will be marked by great uncertainty. Once started, UK-EU negotiations will presumably focus heavily on the single market and subsidies from agricultural and cohesion policies, less on foreign policy, development policy, or trade agreements, such as the Economic Partnership Agreements (EPAs).

For months to come, the EU will be primarily concerned with itself. This is all the more regrettable at a time when we need a strong and transformed Europe. In view of advancing globalization and close international interdependency, individual member states (including the “big three,” i.e. France, Germany, and, until recently, the UK) have been able to accomplish less and less on the international stage when acting alone.

Given growing global connectedness and increasing interdependence, the argument of the “leave” campaigners that a departure would restore Britain “to its former glory” appears all the more paradoxical. After all, during his recent visit, US President Obama reminded the British that they wield considerably more international influence as part of the EU than if they were forced to seek out various coalitions. “The European Union does not moderate British influence—it magnifies it,” Obama told Brexit supporters. Only time will tell who is ultimately right.

With or without the UK, Europe must get its act together. With international cooperation, we have the means, and we know what works. Before plunging into the next phase of soul-searching and navel-gazing, we should give ourselves something to do. With a bold move, the EU should take on the task of providing a vision, and equip its member states with a guiding direction: What is most urgently needed is a global fairness-agenda, merging all aspects of political, economic, and social justice.

 

Thomas Henökl is a senior researcher in political science at the German Development Institute.

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