Charting the route ahead

Date: 21/12/1995

A historic currency decision and a clear strategy on enlargement were agreed at the Madrid summit. Rory Watson reports on what German Chancellor Helmut Kohl described as a “breakthrough”.

GERMAN Chancellor Helmut Kohl was in a jovial and relaxed mood as he prepared to return to Bonn after last week's Madrid summit.

He had every reason to be. He had just seen his colleagues endorse an ambitious agenda which, if fully implemented, would lead inexorably towards further political union.

On the surface, the key decision to emerge from the two-day meeting involved the single currency.

We now know its name - the somewhat unimaginative Euro; the conditions in which it will first appear in January 1999; and the date, 2002, when it will eventually edge out national currencies and enter people's wallets.

The terms were effectively set by Germany. Closer economic integration as budgetary and monetary policies are brought into line, will inevitably boost greater political integration, at least among the single currency participants.

When Kohl described the summit as “a breakthrough”, he was referring not just to the historic currency decision, but also to the route map which the EU leaders have now drawn up to handle membership applications from up to a dozen countries in the coming years.

The formula eventually agreed was one of the most difficult to pin down at the summit. It is carefully couched to bridge the gap between EU leaders who want to identify the likely first wave of new members now and those who argue all applicants should be treated equally at the outset.

With Chancellor Kohl keen to promote the cause of Hungary, Poland and the Czech Republic, the debate effectively focuses on the fate of the Baltics, especially Estonia, championed by the EU's Nordic members and Slovenia, backed by Austria.

The summit's host, Spanish Prime Minister Felipe Gonzalez, insisted afterwards: “The enlargement negotiations will be carried out in total objectivity. There will be equal treatment for all candidates.”

In one way, he is right. The Commission will now prepare individual reports on all the applicants, analysing the extent to which they can meet the economic and political terms of membership.

These will be handed over to EU governments “as soon as possible after the conclusion” of the IGC.

On the basis of these assessments, the Council of Ministers will “take the necessary decisions for launching the accession negotiations”, probably before the end of 1997.

But in another respect, he is wrong. The door is still ajar to allow some applicants to be chosen ahead of others for membership talks. And to date, only Malta and Cyprus have a firm commitment that their negotiations will start within six months of the end of the IGC.

The ambiguity has caused a political storm in Denmark where the Prime Minister Poul Nyrup Rasmussen came under attack this week for failing to win cast-iron guarantees that all accession negotiations would start at the same time. The failure to pinpoint early candidates has annoyed the Polish government.

But Kohl for one is happy with the formula. He believes it sets targets for applicant countries and that individual assessments of their performance will create the momentum for economic and political change, much as the convergence criteria have done within the Union. To single out any countries at this point, he argues, would have diluted the pressure on all applicants to meet the accession criteria.

But the summit also underlined the budgetary arguments ahead. The Netherlands, which fears it may soon be the largest per capita net contributor to the EU budget, specifically insisted the financial implications be analysed and tabled immediately after the IGC is completed. Dutch Premier Wim Kok is determined these should be clearly spelt out before accession negotiations open.

Just as careful drafting of the final conclusions was needed to prevent any public rift over enlargement, so similar skills came into play when EU leaders turned their thoughts to next year's Intergovernmental Conference (IGC) on treaty reform.

Already alerted to the opposition emerging to their plan, Kohl and French President Jacques Chirac did not push their scheme to insert a special clause in the EU treaties allowing a group of countries to integrate faster if they wished. Nor was any serious attempt made to set out the remit for next year's IGC.

Instead, it was left to the Italian government - which will launch the exercise on 29 March in Turin - to iron out the remaining problems. One of the most difficult will be treatment of the European Parliament which, according to the Madrid summit, “will be closely associated with the work” of the IGC, be “briefed regularly” and be able to “give its point of view”.

The formula goes as close as it dares to giving the European Parliament observer status in the IGC - a move every country except the UK and, to some extent, France actively supports.

Explaining the Parliament's request to sit in on the IGC, its President Klaus Hänsch said: “The work in the Reflection Group showed that the two parliamentary representatives are in a position to formulate a common position as we are used to doing this and have learnt it over many years' work in the European Parliament.”

Hänsh accepted that an MEP would be unable to vote or negotiate, but merely offer advice.

If it were granted, he promised, MEPs would not submit a huge shopping list as in 1991, but would concentrate on a few key issues. He also indicated to EU leaders that the Parliament might find it harder to adopt such a responsible approach if it were not granted observer status.

Italy will also have to determine the status of the Turin meeting. Again, a majority of leaders would like it to be at summit level to underline its importance. But Chirac, in his increasingly tetchy relationship with Italian Prime Minister Lamberto Dini, made clear his opposition to the idea.

The list of bilateral arguments continues to grow after Chirac criticised competitive Italian devaluations in June and cancelled a recent Franco-Italian summit, and Italy criticised France at the United Nations over its nuclear testing. The latest incident came in Madrid on Saturday evening, when it was left to Italian Foreign Minister Susanna Agnelli, not Dini, to accompany Chirac and Gonzalez in their meeting with Turkish Prime Minister Dr Tansu Çiller.

The Paris-Rome tension does not augur well for Italy's chances of securing consensus among the 15 on major issues during its six- month EU presidency.

Away from the major economic and political issues which dominated the summit, each of the participants had their own special agenda and most emerged happy.

The Swedes and Finns, in particular, were pleased with the impetus given to Baltic Sea cooperation, the Greeks successfully fought to write 'Euro' in their own alphabet, the French ensured reference to the importance of public services and Austria campaigned for Slovenia not to be forgotten in the drive towards EU membership.

Ireland, which will hold the EU presidency in the second half of 1997, and the UK drew satisfaction from the increased importance given to the fight against drugs.

Luxembourg applauded the call to speed up Trans-European Networks, especially the fast-speed train link through eastern France, and Portugal won support for appropriate action to reduce tension in East Timor.

But the happiest participant - after the 34-page final communiqué and its 96-page annexe were agreed - was Spain, with the specific references to the country's full integration into the Common Fisheries Policy, the need for closer ties with Cuba and, to almost universal incredulity, the welcome given to renewed impetus to the Union's links with Andorra.