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Feb 27th 2020

WASHINGTON, DC

IF THE TRUMP administrations America is the bully of the global trading system, the European Union is the finger-wagging school prefect. Instead of threatening tariffs, its leaders have called for countries to play fairly. As a trade war has raged between America and China, the EU suggested a rules-based solution. When the Trump administration wrecked the system of solving disputes at the World Trade Organisation (WTO), the EU led the search for a fix. As the worlds biggest exporter of services and second only to China for goods, it has a sizeable stake in preserving order.

Enter Phil Hogan, the EUs burly trade commissioner since December 2019. The EU is still a stickler for rules and the multilateralism that Mr Hogan says is in our DNA. But he wants to wield a bigger stick. We have to stand up for our rights more assertively and aggressively, in my view, he tells The Economist. By this he means defending the EU against unfair trading practices. The challenges range from concerns about Chinas state-led system of capitalism to fears that the EUs trading partners are not living up to their commitments.

Part of his brief involves continuing efforts to rescue the system by which the WTO solves disputes. Meanwhile he will have to manage the tense transatlantic relationship. If the job was not daunting enough, he will help negotiate what he hopes will be an amicable trade deal with Britain.

Mr Hogans reputation as a canny politician willing to make tough decisionshis nickname in Irish politics was the enforcer suggests that he may be right for the job. On behalf of his home county of Kilkenny, where he entered Irish politics at the age of 22, he haggled effectively (for example, ensuring that the regions salt depot was in Kilkenny, partly so that in case of ice the local roads would be salted first). He is no flat tyre, as one Leinster admirer puts it. Later he drew controversy when in 2011, as Irelands Minister for Environment, Community and Local Government, he was put in charge of introducing unpopular water charges. It damaged his reputation. But as a consolation prize, the Irish government backed him as the EUs agriculture commissioner.

His experience over the following five years meant that he became intimately acquainted with the EUs most sensitive spots. Alongside Cecilia Malmstrm, then the EUs trade commissioner, he boasts of concluding no fewer than 15 trade agreements. According to some of the negotiators who were on the opposite side of the table, while he could be both charming and funny, his strategies to avoid giving concessions could be deeply frustrating. In some cases, he simply declined to show up.

The American government may roll its eyes at the talk of a tougher EU trade regime. Some in America could accuse the bloc of being too timid about using tariffs to get its own way with trading partners, and too weak to overcome the protectionist instincts of its member states. They ask why, if the EU is so concerned about the demise of the WTOS dispute-settlement system, it ignored Americas complaints about it for so long? Where, they ask, was the EU while America was filing WTO disputes against China? Tough talk is cheap, results will require action.

Mr Hogans first priority is to add muscle to the EUs defences. From May 1st he will oversee a new chief trade-enforcement officer, as well as new enforcement unit dedicated to making sure that existing trade deals are implemented properly. The European Commission is proposing new rules that would sharpen the EUs teeth, including an amendment to enforcement regulations that would allow tariffs against other governments blocking the WTOs dispute-settlement system. On the topic of the WTOs appellate body, Mr Hogan acknowledges some of the American concerns, but adds that he would love to see detailed proposals for solutions to the problems from the Trump administration.

Whether he can maintain stable trade relations with America is another matter. He raised hackles in September after an interview in which he promised to teach Mr Trump the error of his ways. Then in a meeting in January he seems to have clashed with Robert Lighthizer, the United States Trade Representative. If he tries to bring more assertiveness into the EUs side of the transatlantic relationship it could end badly. Stephen Vaughn, an ex-colleague of Mr Lighthizer, warns that attempts to play hardball could backfire.

The Americans want, above all, broad access to the EUs agricultural marketmore than the lobsters, scallops and nuts that are on offer. (Seafood technically counts as an industrial product.) But as Mr Hogan knows well from his previous job, anything much broader than dismantling a few non-tariff agricultural barriers is unpalatable to member states.

He remains upbeat about the transatlantic relationship. I think that were in a better place now than we were some months ago, he says. On February 14th a tariff announcement related to a dispute over aircraft subsidies was milder than expected. A reduction in car tariffs could be on the table, he adds, if member states agree. His challenge is not just to get trade partners to play by the rules. It is to get his own side on board, too.

This article appeared in the Finance and economics section of the print edition under the headline "Hulk Hogan"

More:
The European Unions trade policy will involve some tough negotiations - The Economist

Tourist wearing a protective respiratory mask tours outside the Colosseo monument (Colisee, Coliseum) in downtown Rome on February 28, 2020 amid fear of Covid-19 epidemic.

Andreas Solaro | AFP | Getty Images

The coronavirus pounded the European Union this week with the biggest test of its political, economic and social fabric since the refugee crisis of five years ago.

The ripples from the European migrant crisis of 2015 continue until today with its dual shock to the EU's unity and domestic politics. It triggered a wave of populism and nationalism, the United Kingdom's withdrawal from the EU, and Germany's political fragmentation behind the weakening of Chancellor Angela Merkel.

Most dramatically, the Turkish government this week backed off from its commitment made in 2016, in return for 6 billion euros in EU funds, to prevent Syrian refugees from entering Europe. That followed a Thursday airstrike by Russian-backed Syrian forces in Syria's Idlib province, killing at least 33 Turkish troops.

Even as Turkey ordered police, coast guard and border security officials to allow would-be refugees to pass into the EU, Bulgaria responded by sending an extra 1,000 troops to the frontier with Turkey and Greek police launched smoke grenades at one crossing to dissuade migrants.

Containing pathogens is a much different business than managing waves of refugees. However, what unites the two issues is how dramatically the European Union's response will shape public attitudes about the institution's relevance, responsiveness, and effectiveness at a crucial historic moment.

The impact of coronavirus on Europe's future has the potential to be even more significant than the migrant crisis, particularly as it unfolds in almost biblical fashion atop a plague of other European maladies.

They include, but by no means are limited to: economic slowdown and possible recession (made more likely by coronavirus), the rise of populism and nationalism (stoked as well by the virus), disagreements about how to handle trade talks with a departing United Kingdom (which start Monday), internecine fights over the European budget, and ongoing German leadership crisis and French social upheaval.

The coronavirus morphed this past week into an increasingly global phenomenon that experts agree can no longer be contained. The hit to stock markets was $6 trillion, the biggest weekly fall since the 2008 financial crisis. By Friday, the WHO reported more than 78,000 cases and more than 2,790 deaths ion China and 70 deaths in 52 other countries.

In Europe, what began as northern Italian phenomenon where there have been more than 800 infections has now reached Spain, Greece, Croatia, France, the UK, Switzerland, Romania, the Netherlands, Austria, Germany, Sweden, Norway, Belgium, Denmark, Estonia, North Macedonia, and San Marino.

Italians have cancelled their carnival celebration in Venice and Milan Fashion Week. European hotels in Austria, France, and the Spanish Canary Islands have been locked down in quarantine.

On 28, February 2020, migrants and refugees from Afghanistan, Iran and Pakistan boarded buses bound for the Greek border in a parking lot in the Zeytinburnu suburb of Istanbul, Turkey.

Diego Cupolo | NurPhoto | Getty Images

Though individual EU member states set their own health policies, the EU is responsible for coordinating response to the disease and providing advice regarding its still-open borders.

In most countries, citizens turn to national leaders for response in such situations. In a borderless European Union, which prides itself on free movement of people and travel, crisis response becomes a test of the institution itself and the philosophies behind this unique grouping of 27 member states with about 445 million citizens and $16 trillion GDP.

Thus, much attention this week was paid to whether and how individual EU countries or the EU itself might abandon the 1985 Schengen Agreement that brought 26 of its nations into a passport-free zone of travel.

This has been one of the greatest sources of EU pride and identity. At the same time, the agreement is designed to be far more flexible at moments of crisis than is generally known. The rules allow for the temporary reintroduction of border controls for reasons that include migrant surges, terror attacks and crucial now health emergencies.

"Paradoxically," argues Benjamin Haddad, director of the Atlantic Council's Future Europe Initiative, "one might argue that moments like these are made for the European Union."

That's because, Haddad explains, such moments require the level of technical cooperation and shared decision-making among countries that is the very basis of the European Union. The EU acts as a regulatory superpower through the "normative" power of its trade deals and other instruments that impose standards, which often become global, in areas including digital, health, environmental, and all manner of industrial sectors.

Yet, if imposing regulatory norms is an EU strength, rapid response at times of crisis remains a weakness.

When it comes to scenarios such as the refugee crisis or coronavirus outbreak, member states often take back control, as they did in 2015.The coronavirus will give new ammunition to those who want national border controls tightened or restored.

Marine Le Pen, the right-wing French nationalist, has called for border closures with Italy. In Switzerland, not an EU member but part of the border-free zone, right-wing political leader Lorenzo Quadri said it was "alarming" that the open borders' "dogma" would be considered a priority at such a time.

Health officials in Trieste airport measure the body temperature of incoming passengers. Trieste, 28th of February 2020.

Jacopo Landi | NurPhoto | Getty Images

As the number of coronavirus cases grows in Europe, it seems unlikely that EU and national officials will be able to avoid the greater imposition of border controls. On Sunday evening, for example, Austria halted some train connections at the Brenner pass with Italy after officials reported that two passengers had been stopped who were infected with the virus.

If the EU and its member states respond smoothly and in a coordinated fashion, the coming days could reinforce the collective value of the European Union.

Should the EU appear ineffective as the virus spreads, that will color European attitudes for decades to come.

In his classic 1945 novel The Plague, the French writer Albert Camus writes, "I have no idea what's awaiting me, or what will happen when this all ends. For the moment I know this: there are sick people and they need curing."

"The virus, alas, has so far been tackled by a divided continent, just like the plague isolates people in Camus's plot," Gianni Riotta, a visiting professor at Princeton University, tells Judy Dempsey at Carnegie Europe. "Austria scrapped trains from Italy, Italy broke with the European Union, too hastily grounding flights from China, only to see the disease spread faster with passengers arriving unchecked from other airports."

It's not too early to ask whether Europe itself will fall victim to the virus or emerge healthier from the challenge.

Excerpt from:
Op-Ed: Coronavirus could be a bigger test for the EU than the refugee crisis - CNBC

KASTANIES, Greece With tear gas clouding the air, thousands of migrants trying to reach Europe clashed with riot police officers on the Greek border with Turkey on Saturday morning, signaling a new and potentially volatile phase in the migration crisis.

The scene at Kastanies, a normally quiet Greek border checkpoint into Turkey, rapidly became a tense confrontation with the potential to worsen as dozens of Greek security officers and soldiers fired canisters of tear gas. Riot police officers with batons, shields and masks confronted the migrants through the wire, yelling at them to stay back.

About 4,000 migrants of various nationalities were pressed against the Turkish side of the border. An additional 500 or so people were trapped between two border posts, but still on the Turkish side, at the long and heavily militarized land border that has turned into the flash point of the tug of war between Turkey and Europe.

Some people had climbed onto the limbs of trees or were crouching against the thick loops of barbed wired placed on the ground by the Greek Army. They cheered, booed and screamed to be let through.

President Recep Tayyip Erdogan of Turkey declared on Saturday that he had opened his countrys borders for migrants to cross into Europe, saying that Turkey could no longer handle the numbers fleeing the war in Syria.

What did we do yesterday? he said in a televised speech in Istanbul. We opened the doors. His comments were his first to acknowledge what he had long threatened to do: push some of the millions of Syrian refugees and other migrants in Turkey toward Europe in order to cajole the European Union to heed Turkeys demands.

He accused European leaders of not keeping their promises to help Turkey bear the load of millions of Syrians.

Mr. Erdogan has also called for European support for his military operations against a Russian and Syrian offensive in northern Syria that has displaced at least a million more Syrians toward Turkeys border. He has also sought more support for the displaced and the 3.6 million Syrian refugees already in Turkey.

The migrants at the border had heeded Mr. Erdogans call and rushed to Turkeys borders with Europe, some on Friday taking free rides on buses organized by Turkish officials. But once at Europes doorstep, they were met with a violent crackdown.

Migrants were also heading by sea to the Turkish coast, from where they hope to reach Greek islands, facilitated by the Turkish authorities, but officials reported few arrivals Saturday, perhaps because of poor weather at sea.

The mini-exodus was live-streamed by Turkish state television in scenes reminiscent of the 2015 migrant crisis that Europe solved only with Turkeys help. Syrians shared information, some joking about the Turkish facilitation, suggesting they should publish the telephone numbers of people smugglers, too.

The International Organization for Migration, a United Nations agency, said that as many as 10,000 were making their way through Turkey to the northern land borders, in hopes of reaching Europe.

The Greek authorities said on Saturday that they had intercepted some 4,000 people attempting to cross at various spots of the 50-mile border overnight, and that only a few had been successful and made it to Greece.

The frontier is heavily militarized on both sides, and is closed off with barbed wire only for about seven miles. It runs through fields, valleys and forests, and is partly demarcated by the Evros River and its delta, where migrants have long died because of choppy waters.

Even if the Greek officials succeed in holding back the hundreds at the small border chokehold in Kastanies, it will be hard to secure the entire border as migrants become dispersed and try their luck farther afield.

Most on the front line of the confrontation at the Kastanies crossing were men, but children were heard screaming farther back, and women were hanging on the side of the group stuck between the Turkish and Greek officials.

The ground was strewn with empty Turkish tear-gas canisters, rocks and burned-out tree branches, and the Greek guards pledged a standoff for as long as it took into the cold night and beyond.

Greece came under an illegal, mass and orchestrated attempt to raze our borders and stood up protecting not only our frontiers, but those of Europe too, said Stelios Petsas, the Greek government spokesman. He added that 66 migrants had been arrested crossing the land border illegally, and none have anything to do with Idlib.

Our government is determined to do whatever it takes to protect our borders, he said.

Mr. Erdogans comments on Saturday came after Turkey suffered heavy losses from Russian or Syrian airstrikes in northwestern Syria on Thursday and as Turkey seeks American and European support for its Syrian operations. The death toll from the strikes has risen to 36, Mr. Erdogan said. More than 30 soldiers were wounded.

The Turkish leader has avoided accusing Russia directly of carrying out the airstrikes, and has spoken with President Vladimir V. Putin of Russia by telephone. But he said Turkey was retaliating with strikes of its own, including on a Syrian chemical weapons site south of the city of Aleppo. Turkey has deployed thousands of troops in recent weeks into Idlib Province to try to stem the Russian-backed advance.

Mr. Erdogan is struggling to handle the growing crisis in Idlib, the last Syrian province held by the rebel forces his government has supported. Turkey has lost more than 50 soldiers in the past two months in Syria, which has angered many Turks, while domestic resentment toward Syrian refugees has grown amid an economic downturn.

The Turkish president called on Mr. Putin to get out of our way in Idlib and allow Turkey to push back Syrian forces to positions agreed upon under a 2018 de-escalation agreement.

Matina Stevis-Gridneff reported from Kastanies, Greece, and Carlotta Gall from Istanbul. Hwaida Saad contributed reporting from Beirut.

Continue reading here:
Erdogan Says, We Opened the Doors, and Clashes Erupt as Migrants Head for Europe - The New York Times

The European Union considers todays conclusion of the Afghanistan-U.S. Joint Statement for Peace and the settlement between the U.S and the Taliban as important first steps towards a comprehensive peace process, with intra-Afghan negotiations at its core. The current opportunity to move towards peace should not be missed. The European Union expects these Afghan-owned and Afghan-led negotiations to start without delay in an inclusive manner and aiming at a lasting peace that could create an environment of security and stability for all Afghans. The continuation of a reduction in violence and its expansion into a ceasefire constitute a necessary condition for trust between the negotiating parties.

The European Union stands ready to facilitate and support the peace process with the aim of preserving and building upon the political, economic and social achievements of the people of Afghanistan since 2001, which should be irreversible. The conflict needs a political solution in which human rights, including womens rights, are respected and common grievances are addressed. The European Union stresses the importance of an inclusive peace process with all political factions, where notably Afghan women and minorities as well as the civil society, are represented in a meaningful manner. Respect for the constitutional order and rule of law is paramount during the process.

In this crucial time, unity is essential to master the challenging tasks ahead and for the long-term future of the Islamic Republic of Afghanistan. The European Union calls upon all actors to unite forces for the coming period. It is vital that all people of Afghanistan feel represented in the next government and in peace negotiations. This would help address grievances, including in the context of the recent electoral process, and promote reconciliation. The EU calls on all stakeholders to put the interests of the nation above all other considerations, as the collective responsibility of all Afghan political forces.

See more here:
Declaration by the High Representative on behalf of the EU on current political developments in Afghanistan and the prospects for peace - EU News

The United Kingdom and the European Union have now formally laid down their opening positions for the high-stakes talks this year on their future economic relationship after Brexit. And while Britains stated refusal to swallow any of Europes demands for regulatory alignment and a level playing field grabs most of the headlines, a potentially bigger and even more imminent flash point looms elsewhere: Fish.

Since joining in the early 1970s what would eventually become the EU, Britain, like other European countries, has essentially had a shared approach to fisheries in British and European waters. And that has long been a sore point for British fishermen, who rightly note that European fishing vessels gained access to a lot more U.K. waters than the other way around and who chafe at what they see as Brusselss ham-handed management of fisheries, including annual quotas and rules that member states must abide by.

Since British membership in Europe happened to coincide with the near-collapse of the British fishing industry, Europe has become a scapegoat for that decline. Taking back control of British fisheries, like borders, regulation, and justice, became a central plank in the 2016 campaign for Brexitand the new government of Prime Minister Boris Johnson has already laid out its plan for sovereign control of fisheries in legislation.

Britains negotiating position, published Thursday, calls for a comprehensive free trade agreement between the U.K. and the European Unionbut doesnt even include fisheries as part of that deal. Instead, as with security, law enforcement, and aviation, Britain sees a future fisheries agreement as something completely separate. The U.K. aims to cut off European fishing vessels access to British waters and negotiate any access and allowable catches on a yearly basis.

Europe, in stark contrast, sees fisheries as almost the keystone of any future economic agreement between the two. In its negotiating position, also published this week, Europe made clear that any talks on trade must start with a continuation of the current EU fishing arrangementwhere European vessels have open access to British waters and remain under the management of the Common Fisheries Policy Britain so despises, including annual quotas.

Fisheries are absolutely a big flash point, said Joe Owen, the Brexit program director at the Institute for Government, a think tank in London. The two sides have been squaring up on this for a long time.

More urgently, while the two sides ostensibly have until the end of the year to wrap up talks on their future trade relationship, Europe made clear that the fisheries question must be sorted by July 1 so that European fleets can plan for next years fishing quotas.

The clock is really tickingit has to be done by summer, said Michael Leigh, a senior fellow at Bruegel, a think tank in Brussels. The idea that December is the deadline is false as far as fisheries are concerned.

Its a bit odd that fish and fisheries could occupy such a central place in the all-important discussions about the future economic relationship between the U.K. and Europe. Its a vanishingly small industry in economic terms in both blocs, especially in the U.K., where it represents about 0.1 percent of GDP. In contrast, the EU accounts for roughly half of British imports and exports in the economy as a wholemaking the securing of a broad free trade agreement a lot more economically important than wresting control of coastal waters.

But fisheries have always been an emotive and politically sensitive issue, in both Britain and the Continent. Fishing states in the EU, such as Ireland, Spain, and Portugal, will likely have to sign off on whatever future economic agreement the two sides makewhich means Brussels has to secure continued access for European fishermen as part of any accord if it expects to ratify it.

In Britain, coastal fishing communities voted overwhelmingly for Brexiteven in Scotland, which on the whole roundly rejected the referendum to leave Europe. Many British fishermen who argue that joining Europe led to the decimation of their industry and see a golden opportunity to right that mistake now fear the government could throw fishing interests under the bus to secure a broader deal.

Its a hugely political and symbolic issue, even if its nowhere near as economically important as some other industriescommunities and constituencies are based around fishing, Owen said. And from the EU side, the same thing is true. The U.K. is a vital trading partnerwould they imperil that because of fishing communities in coastal states?

Britains fight with Europe over fish obviously didnt start with the EU or the Common Fisheries Policy. For centuries, access to the rich fishing waters off the British coast has been a bone of contention between England, Scotland, and Europeans like the Danes, Dutch, and French.

While England granted pretty free access to the Dutch and others to fish in British waters under Queen Elizabeth I, the growing power and wealth of the Dutch herring fleets angered many Britsespecially Scots, then and now the most reliant on the fishing industry. As the legal historian Douglas Johnston has noted, when Scotlands James VI took the throne of England as James I, he made that animosity to foreign fishing fleets state policy. In 1609, he laid claim to British fisheries and banned all foreign vesselsunless they got a license from the British crown, pretty much the same recipe for fishing access as envisioned in Boris Johnsons road map.

The British obsession with claiming ownership and sovereignty of its waters culminated in the legal theories of John Selden, who coined the closed sea school of maritime law to rebut Dutch rivals whod pioneered a legal vision of an open sea. That frontal confrontation between British and Continental visions of how to share European waters continued, with fishing a big part of the three Anglo-Dutch wars of the 17th century.

Access to fishing grounds has also colored the Anglo-French rivalry for centuries, with fishing rights an important part of peace treaties in 1763 and 1815. Both countries spent the rest of the 19th century trying to sort out fishing rights in the English Channeland still are, at times, with several scallop wars breaking out in recent years.

But Britains best-known fight over fish is probably the three cod wars with Iceland between the 1950s and 1970s. (There were actually 10 in all, going back centuries.) The showdown over the British fishing fleets access to rich cod waters off Iceland played out in repeated violent clashes over a period of decades and nearly pulled Iceland out of NATO and into the Soviet orbit. In the end, Britain lost most of its access to what had been a very lucrative fishing groundjust as the overall industry was entering a period of sharp decline and right as Britain joined Europe.

While British fishermen blame Europe and its fisheries policy for their economic decline, the problem isnt really in Brusselsbut in the water. Beginning in the late 19th century, steam trawlers began replacing small sailing vessels, making longer trips for further distances with ever more sophisticated gear to land ever larger hauls of bottom-dwelling fish like cod and haddock. The end result was massive overfishingand no matter how hard the British fleet worked, it could never catch as much fish as it did more than a century before.

For every unit of fishing power expended today, bottom trawlers land little more than one-seventeenth of the catches in the late nineteenth century, one scientific study concluded. The Common Fisheries Policy was not responsible for this collapse, although under its auspices most stocks have continued to decline.

But since the collapse coincided with European membership and common fisheries management, fishing communities tended to blame quotas and European ships. Thats one reason coastal communities were vocal proponents of the Leave campaign and are still pressuring the Johnson government to seize the chance to reclaim British control over fisheries.

Theres no doubt that British fishermen view Brexit as the occasion to try and expel European fishing vessels from U.K. waters, Leigh said.

Its not even clear that British plans to do so would prevail. Under international law, nations can lay claim to historic fishing rightswhich would likely give European fleets at least some access to waters that they have plied for decades or even centuries.

And for the British fishing industry as a whole, there is a bigger question looming in the talks with Europe. Britain by and large doesnt eat what its fishing fleet catches, exporting most of the fish to Europe. What Brits like to eat, in contrast, is mostly landed by European fleets.

While the British negotiating plan blithely assumes that it can keep free trade in fish while barring European fleets, thats unlikely to work, Owen noted. Continued tariff-free access to Europe for that exported British fish will depend on first reaching an agreement over fishing access in the first place.

Most observers expect that fish and fisheries will ultimately become a bargaining chip in this years talks.

Europe hopes that if Britain is forced to ask for an extensioneven though the Johnson government has been absolutely adamant that talks will be done by December or not at allit can squeeze out fishing concessions from London as the price of more time. Britain wants to use fishing access, which is simply a must-have for many coastal states in the EU, as a lever to secure continued privileges for hugely important economic sectors, like trade in goods or financial services.

But what if the chip never gets bargained away but becomes the game itself?

The risk is, rather than working to get to the middle ground, because it is such a politically totemic issue for certain constituencies on both sides, you end up with very hard-line positions and end up with a bust-up over fish, Owen said. Something that has relatively small economic value could end up preventing a much bigger deal.

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Fisheries Are Small but Will Play Huge Role in UK-EU Talks - Foreign Policy