EU elections set the course for Europe

2024-05-28 at 12:05 Timo Löyttyniemi

The approaching EU elections are more important than ever. There is a full-scale war on European soil, and Europe is facing hybrid threats on a daily basis. One European state is defending the whole of Europe while another is attacking the defender by all conceivable means. Originally a peace project, the EU is now facing the challenge of how to achieve peace.

On 15-16 June, world leaders will gather at a five-star hotel in Bürkenstock, Switzerland, to decide how to kick-start the peace process. What is the right course for peace in Europe? How can Russia be involved in this peace process? The Bürkenstock talks in mid-June will not amount to talks on a peace agreement in Ukraine, but may produce preliminary sketches of such an agreement. Before these talks, we will have the EU elections 6–9 June.

EU enlargement

The first important question in the EU elections is whether the EU should be enlarged and whether new countries should be admitted. So far enlargements have been successful. However, the UK's departure from the EU is a sound reminder that if enlargement is not a success and if the policies are not to everyone's liking, then leaving the EU is a real option. The big question is how and when Ukraine will be allowed to make concrete progress toward EU membership. If Ukraine is successful in its war efforts, and once peace is made, Ukraine will have earned its place in the EU family.

Defence policy

Defence lies now at the core of the EU. Through NATO, it has been at the heart of Brussels for a long time. Now it is being integrated into EU politics. NATO and Europe seek to increase defence spending and create vehicles for channelling this money to finance orders for the European defence materiel industry. It is a major common challenge that will put the internal market to a real test.

Internal order

Europe is facing the challenges of migration, crime and Russia's hybrid influence activities. The EU must help countries to defend the European order. After all, the maintenance of law and order is one of the key tasks of any government to enable citizens and businesses to pursue their dreams. As an institution composed of states, the EU is called upon to defend public order. Frontex is a success story, having fulfilled its role in coordinating border control.

Industrial policy

Industrial policy is gaining prominence in the EU-wide debate for a number of reasons. Each individual country is seeking to formulate a new industrial policy, and so is the EU. Strategic autonomy, semiconductor ecosystems, green development programmes, peace funds and several other projects fall under this theme. When working out industrial policy strategies, it should not be overlooked that the economy of a modern society is increasingly based on services and ICT. Economic and industrial policy will in any case be redefined at EU level, as geopolitics has frustrated many of the EU's important agendas. Prime examples of this are the attitudes towards state subsidies and the flood of Chinese cars into Europe.

Decision-making in the EU

EU decision-making has always been confusing, slow and multi-tiered. Despite this, the EU has often been able to find solutions and been surprisingly fast in decision-making when it comes to issues requiring brisk leadership. Decision-making within the EU is based on unanimity on a number of important issues. The big question is when the EU will expand adoption of majority voting. Most likely, it is only a question of time when necessity will dictate the means and the timetable.

EU Commission and the political groups in the European Parliament make it possible to pursue and reinforce the European agenda side by side with the policies advocated by the Member States. The system consisting of the Council (Member States), Parliament and Commission is perhaps complicated, but it works.

EU and the economy

The EU economy and the exchange-listed companies in its territory are lagging behind the United States. Growth drivers are sorely needed. Growth was believed to stem from free world trade. Now Europe needs to stop and think things over again. Should the Union take a fresh look at borders, customs, big business, legislation and innovation to make European business thrive and create jobs?

In conclusion

Luckily for pension investors, Europe is made up of many different bits and pieces. At the time of the euro crisis, there were the crisis-ridden states and others. At the time of Brexit, there was the UK and others. At the time of the Ukrainian crisis, there are the eastern border states and others. Crises come and go. Europe’s strength lies in its diversity. Nordic countries have also shown their strenghts in economic competition.

The EU elections will set the course for Europe. We may wish that the new parliamentarians will be able to work together to lead Europe on to a path of growth and renewal. But an even bigger wish is that the European peace project will succeed, and security will prevail.

Writer is VER's CEO Timo Löyttyniemi

TLö blogi 2020

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