Tough time ahead, but the little state is up to it

By Anna McLauchlin

Date: 16/12/04

LUXEMBOURG has a tough time ahead as it takes over the EU's rotating presidency of the Council of Ministers in January, with a weakened Stability and Growth Pact to sort out and accession talks with Turkey to launch.

But facing mighty challenges is what Luxembourg is all about.

It might have the smallest population in the EU after Malta - only 440,000 - but its reputation as the leanest and meanest presidency of the Union remains unrivalled.

It is seemingly able to sew up complex dossiers that have stalled in the Council for years. "It has a success record that is out of proportion to its size," notes one long-standing political journalist.

2005 will be Luxembourg's eleventh presidency since it first had the pleasure in 1960 and it can reel off a few major success stories.

It was Luxembourg that, in 1985, persuaded member states to sign up to the Single European Act (SEA), put forward by the then European Commission president Jacques Delors.

The SEA introduced qualified majority voting in the Council of Ministers, thereby allowing more proposals to become law, and gave more legislative power to the Commission and the European Parliament. Perhaps even more significantly, it set the end-of-1992 deadline for the completion of Europe's internal market.

The Amsterdam Treaty, which enshrined the co-decision procedure giving the Commission and Parliament an equal say in decision-making and put various measures in place to equip the Union for its future enlargement, was also signed in Luxembourg in 1997.

And the small country lays claim to the 1991 Treaty on European Union - labelled the Maastricht Treaty - although that was eventually agreed under the Dutch presidency in December of that year. "We were responsible for about 90% of that treaty," says a former minister.

So what has been the secret of Luxembourg's success? Firstly, it puts a lot of effort into its time at the head of the Council of Ministers. There is even an understanding between its political parties that, while the ruling government is heading up the Council, the opposition should leave it alone to get on with the job.

Its diminutive size is also part of its charm. "People are less suspicious of us than they might be because we have fewer interests to defend, apart from our banks," says one diplomat.

In addition to Luxembourgish, its government officials are usually trilingual - German, French and English - which aids negotiations with ministers. And its smaller administrative core means that the presidency is forced to work very closely with EU officials in the Council, which some say leads to more efficiency.

"They have to lean on us more than bigger countries do and that creates a constructive relationship," says one Council official.

But it has not all been a bed of roses. Luxembourg may have laid the foundations for Maastricht, but it had its fair share of critics when it failed to wrap up negotiations. And Ankara suspended political dialogue with the EU after Luxembourg's December 1997 summit ruled Turkey not yet ready to become a member of the EU.

Author comments on the preparedness of Luxembourg for taking over the Presidency of the Council of the EU on 1 January 2005 and looks back on previous Presidencies held by the country.