Despite German setback, EU has new spring in its step

European leaders met on Friday at a key summit of presidents and prime ministers. While the collapse of German coalition talks, Brexit and Catalan political unrest in Spain formed the backdrop to the meeting, EU politicians have a new spring in their step as the overall political and economic climate for the continent has improved significantly in 2017.
In his recent EU state-of-the-union address, European Commission President Jean Claude Juncker asserted that, unexpectedly, the “wind is back in Europe’s sails” after a spate of positive news in the spring and summer.
What has driven this turnaround in sentiment is the failure of far-right populists to win key electoral contests in France and the Netherlands, and many of the continent’s leaders sense that the current euro-skeptic wave may have reached its peak. This political fillip has been reinforced by stronger economic data too. After several years of slow growth, the euro zone economies are performing better.
Recognizing the overall better climate, key European leaders believe that there is now a window of opportunity for the continent, but that this “won’t stay open forever,” in Juncker’s words.  For instance, Italy’s Europe Minister Sandro Gozi recently said we “have a possibility of launching a new phase… It is essential that there will be a process of relaunch and deepening of European integration.”
However, especially after the setback in Germany last week, only time will reveal if the tide is truly turning positively for those forces championing European unity and integration across the continent following the victories of liberal centrists Emmanuel Macron in France and Mark Rutte in the Netherlands.
As many European leaders are aware, the political situation across the continent is fragile, including with the prospect that Italy’s euro-skeptic 5 Star Movement could perform strongly in that country’s general election next year.
Nonetheless, the contrast now with the mood music of key European leaders at the start of the year is striking. For instance, European Council President Donald Tusk appeared despondent in February when he said the threats facing the EU were “more dangerous than ever,” with three key challenges “which have previously not occurred, at least not on such a scale,” that the continent must tackle.
The first two dangers related to the rise of anti-EU, nationalist sentiment across the continent, plus the “state of mind of pro-European elites,” which Tusk feared were too subservient to “populist arguments as well as doubting in the fundamental values of liberal democracy.”
At that stage, it was feared by some not only that far-right Marine Le Pen could pull off an upset victory in France, but also that the anti-establishment Freedom Party could top the poll in the Netherlands.
While the salience of these two issues has subsided, perhaps only temporarily, the third threat cited by Tusk remains. That is what he called the new geopolitical reality that has witnessed an increasingly assertive Russia and China, and instability in the Middle East and Africa that has driven the migration problems impacting Europe. Intensifying this is uncertainty from Washington, with President Donald Trump openly calling for more Brexits across Europe.

Politicians, from Macron to Merkel, believe that the EU must now look to improve the internal and external security of the continent, while enhancing the socioeconomic welfare of citizens through a jobs, growth and competitiveness agenda.

Andrew Hammond

Nevertheless, numerous European leaders believe that recent economic and political news has brought at least a temporary respite. And in this potential window of opportunity, politicians — from Macron to German Chancellor Angela Merkel — believe that the EU must now look to improve the internal and external security of the continent, while enhancing the socioeconomic welfare of citizens through a jobs, growth and competitiveness agenda.
There is a growing consensus around what several leaders have called a new, 21st-century European security pact comprising measures to enhance security and border protection, and greater EU intelligence cooperation to emphasize the resilience of the EU project.
Given current disagreements within Europe on the wisdom of wider integration initiatives, including in the area of economics, security issues are one of the few areas where there is significant consensus across the member states and Brussels on the continent’s best way forward.
Impetus for moving on this security agenda has been provided by recent terrorist attacks, the ongoing migration crisis, and the launch last year by EU foreign policy chief Federica Mogherini of a new global strategy on foreign and security policy.
On a related theme, Brussels is pushing forward with a European Defense Action Plan that advocates greater military cooperation between the EU member states. This is being driven, in part, by the new geopolitical reality cited by Tusk, which includes Russian assertiveness post-Crimea and Trump’s uncertain commitment to NATO.
Brexit too could now also eliminate a longstanding obstacle to greater European cooperation in this sphere, given that successive UK governments have been opposed to deeper defense integration at the EU level.
One signal of the potential direction of travel came last year when Juncker said the EU needs its own army, a proposal welcomed by then-German Defense Minister Ursula von der Leyen, so Europe can “react more credibly to the threat to peace in a member state or in a neighboring state.”
While such a force is at best a longer-term aspiration, the European Defense Action Plan has a goal of reversing around a decade of defense spending cuts by EU states, totalling more than 10 percent in real terms.
Taken overall, a growing number of European leaders sense that the euro-skeptic wave may have passed its peak, and that at least a temporary window of opportunity may now exist to move forward with a new integration agenda. Decisions in the coming months will help define the EU’s longer-term political and economic character in the face of multiple threats, including Brexit, still facing the continent.

• Andrew Hammond is an associate at LSE IDEAS at the London School of Economics.