The EU’s Looming Summit Car Crash
It is not just America that risks hanging Ukraine out to dry
Volodomyr Zelensky is in Washington today to plead with Republicans in Congress to stop blocking a $61 billion package of urgently needed aid that has promised by President Joe Biden. But the Ukrainian president does not just have an America problem; he has a Europe problem too. At a summit this week, European Union leaders were expected not only to sign off on further €50 billion of funding for Kyiv but also to agree to open formal accession talks with Ukraine. But Viktor Orban, the Hungarian prime minister, is threatening to veto both initiatives. Even an unsavoury last minute decision by Ursula von der Leyen, the Commission president, to release EU funds currently withheld from Hungary due to its rule of law breaches may not be enough to unlock a deal. A summit that had been intended to underline the EU’s unity and claims to be a geopolitical actor may yet end up a car-crash.
In Brussels, where I spent much of last week, the anxiety is palpable. That partly reflects fears that, following recent setbacks on the battlefield, Ukraine may be in danger of losing the war. A Ukrainian defeat could have disastrous consequences for the continent given the threat that a victorious Russia would pose to other European countries, including EU members such as Poland and the Baltic states. Failure by the EU to deliver on its promises could make such a defeat more likely by denying Kyiv the funds it needs to stabilise its economy and undermining Ukrainian morale while emboldening Russia. But the anxiety in Brussels also reflects growing alarm that Donald Trump could return as US president after the election next November and pull the plug not just on American backing for Ukraine but Nato too. That would pose existential questions for the EU to which it currently has no answer.
Indeed, the EU is more deeply divided on the question of Ukraine than it is willing to let on, particularly on the question of whether to accept Ukraine as a new member. The reality is that the offer to open accession talks at this week’s summit was a largely symbolic move in any case, given that there is no chance of Ukraine actually becoming a full member for years. EU leaders declared at a summit in Granada in October that “enlargement is a geo-strategic investment in peace, security, stability and prosperity”. But there is no agreement on what should be the terms of membership, nor how the EU itself may need to evolve to incorporate a country of 40 million people which was already one of the poorest in Europe before its economy was devastated by war - other than a recognition that the status quo is not an option. As a recent report by the European Council for Foreign Relations put it:
“The prospect of EU enlargement – be it close or distant – constitutes an inevitable shift in the political balance of power in the EU: between big and small; east and west; rich and poor; statists and free marketeers. A great transformation may await the EU – some countries hope for it, others fear it. Very few, though, have doubts that it is in the making.”
There are four broad areas where a transformation may be necessary, each of which is highly problematic. The first concerns EU decision-making. Hungary’s threat to veto decisions relating to Ukraine has highlighted once again the vulnerability of the EU’s cumbersome decision-making to what many see as blackmail. Some EU states, led by Germany, argue that the answer must be an extension of qualified majority voting, whereby decisions can be taken if they are backed by 15 out of 27 member states as well as member states representing 65 per cent of the population, as a condition of future enlargement. A Franco-German working group recently proposed extending QMV to areas such as foreign and security policy, enlargement and the rule of law, and fiscal and tax policy. But smaller states are reluctant to give up their veto power, which they see as an essential guarantee of national sovereignty.
The second problem is the EU budget, which would come under intense strain if Ukraine were to become a member. According to one estimate, Ukraine would qualify for €186 billion over seven years from the current EU budget, assuming no changes to the way that the Common Agricultural Policy and cohesion funds are disbursed. Many countries that are currently net recipients would become net contributors, while farm subsidies in the rest of the bloc would fall by a fifth. The alternative is a big increase in the EU budget, whether through more national contributions, more debt or more EU-wide taxes. Yet member states are struggling to reach a deal ahead of this week’s summit on a review of the current budget which is under severe strain as a result of higher inflation and interest rates and the cost of support for Ukraine.
A third issue concerns the rule of law, a fundamental concern for a bloc that is built upon shared values and in which the transparent enforcement of EU wide rules is vital to the functioning of the single market. Orban is not wrong when he accuses Ukraine of being “one of the most corrupt countries in the world”, even if he is the last person to be making such accusations, having turned his country into a corrupt autocracy. Kyiv has made significant progress towards strengthening its institutions and would have to implement further deep reforms as part of the accession process. Yet the backsliding on rule of law in recent years by Hungary and Poland, as well as the continued high levels of corruption in Bulgaria and Romania, has led some states to demand new rules allowing Brussels to block funding or even suspend membership for offenders as the price of Ukraine’s accession.
Finally, and most consequentially, there is the question of security. In previous rounds of EU enlargement, the pattern has been for countries to join Nato before they become members of the EU. That had a compelling logic. If EU member states are to pool their sovereignty and extend the borders of the single market, then it is vital that the new member state’s accession is underpinned by credible security guarantees. Although the EU treaties include a guarantee of mutual aid, these are not considered to be of any value given the lack of any common EU defence capability. The only credible security guarantor is Nato. But Nato at its most recent meeting was unwilling to make any commitment of future membership to Ukraine.
For some member states, led by France, the way to square this circle is to significantly boost the EU’s own common security policy, in line with President Emmanuel Macron’s long-standing goal of boosting the EU’s strategic autonomy. Indeed, France believes that integrating Ukraine with its large, battle-hardened military into an enhanced EU security architecture will increase EU security by securing its Eastern border. But others are deeply opposed to anything that might complicate Nato’s role in providing security to Europe or, worse still, give the US a pretext to reduce its own commitment to European security. These countries regard Nato membership as the priority for Ukraine and a precondition for EU membership.
Where this leaves Ukraine’s EU bid is anyone’s guess. Some governments argue that the EU needs to embark on a process of internal reform before it opens up to new member states, or at least in tandem with enlargement. Yet others regard such talk as simply a device to delay Ukraine joining, perhaps indefinitely. There will certainly be some EU leaders who who will be happy to hide behind Orban as he puts a spanner in the accession process. Nor is it clear that voters across the EU will support enlargement on changes to EU treaties. Meanwhile the Franco-German working group, recognising that full EU membership for Ukraine may be hard to deliver, put forward proposals that fall short of full EU membership, including allowing Ukraine to participate in the single market and other EU programmes, and to hold observer status at EU meetings, but without access to the EU budget or a right to vote.
Yet all this presupposes that the EU has the luxury of time while it makes up its mind how to proceed. It may not be so fortunate. Trump’s re-election would profoundly change the geopolitical landscape, calling into question the US security umbrella that all of Europe has for so long taken for granted. As things stand, a German think-tank expects a Russian attack on a Nato member in six to ten years, Poland within three. France is stationing more troops in Estonia. Could the EU survive the occupation of a member state by Russia, particularly if that member state was part of the eurozone? At the very least, it would be a recipe for economic, political and financial fragmentation on a far greater scale than anything seen during the eurozone crisis.
Of course, Europe is famously forged in crisis. But these are not questions that the EU can wait to address once it knows the outcome of the US election. EU leaders must decide now whether they are really prepared to do what is necessary to deliver that geostrategic investment in peace, security, stability and prosperity, or whether they are content to gamble the continent’s future on the hope of a Biden victory.