Brussels & Berlin | October 2020

It seemed like Washington spent the summer looking longingly toward Europe: freedom of movement abounded, and holidays proceeded, albeit it under unique circumstances. Now, however, the European Union is experiencing a second wave of the pandemic, eliciting fresh questions about the efficacy of the EU’s initial COVID-19 response.

Intro

Spain currently leads with the most cases at nearly 780,000, followed by France and the U.K. Belgium has the third highest death rate per million people, falling just behind San Marino and Peru. German Chancellor Angela Merkel has warned that the most difficult months lie ahead, and EU President von der Leyen and Commissioner Mariya Gabriel are among EU leaders currently quarantining following possible exposure. For more on the pandemic in Europe, see Politico’s pandemic tracker here.

The Budget

Tense negotiations unfolded in the spring over so-called “coronabonds” and the EU bailout package. The EU ultimately introduced sizable bailout measures with relatively few strings attached. In echoes of the 2008 financial crisis, countries such as Germany and the Netherlands were reticent to support large bailout plans for countries such as Greece, Italy, Spain, and France, but the EU came together in July to back plans for a $858 billion (€750 billion) bailout.

Now, lawmakers in Brussels have been in contentious negotiations regarding the finalization of the multiannual financial framework (MFF), the EU’s 2021-2027 budget. In late July, EU leaders agreed to an MFF of nearly $1.3 trillion (€1074.3 trillion), which does not include the additional bailout funds. In recent negotiations, the European Parliament has demanded “top-ups” for fifteen programs, including Horizon Europe and Digital Europe, among others, but the Council has been reticent to consent to spend what would amount to an additional €110 billion. Germany, who currently holds the EU presidency, has further complicated budget talks by tying funding to compliance with the rule of law (a so-called “good behavior clause”), a move intended to rein in regressive policies in Hungary and Poland. This policy push coincides with the release of the European Commission’s first ever Rule of Law Report, which decried democratic backsliding in several EU countries—including Hungary and Poland.

All Things Digital

Emboldened by the precedent-setting success of the General Data Protection Regulation (GDPR), the European Commission is currently embarking on a substantial overhaul of the e-Commerce Directive. The Digital Services Act (DSA), expected by the end of the year, will guide EU digital policy for the foreseeable future. In late September, parliamentarians’ priorities for the DSA were laid out in a vote in the European Parliament’s Internal Market and Consumer Protection Committee (IMCO). These priorities include rules on targeted ads, content moderation, platform liability, and a push to require consumers’ right to know if a service is backed by artificial intelligence or machine learning. Like the GDPR, the DSA will likely serve as a guide for U.S. policymakers hoping to pass long overdue privacy legislation or platform liability reform.

As if the world of politics lacked nebulous buzzwords, “strategic autonomy” has become the term du jour in Brussels. While strategic autonomy can be summarized as the push for Europe to become stronger and more independent in an increasingly multipolar world, skeptics of this political philosophy fear it may lead to increased protectionism, particularly regarding digital trade. In a recent speech in Brussels, European Council President Charles Michel was quick to defend strategic autonomy, saying “autonomy is not protectionism.”

Democracy and Security

European leaders held a summit in Brussels recently to discuss a wide range of evolving issues, from the budget to geopolitical conflicts. Tensions have continued to mount between Turkey and Greece regarding long-standing disputes, including oil drilling in the Mediterranean. At the summit, EU leaders agreed to a more aggressive stance on Turkey, including carrots (increased trade, migration assistance) and sticks (possible sanctions). NATO Secretary General Jens Stoltenberg has urged Turkey and Greece to reach an accord to prevent possible military conflict. Turkey is also embroiled in the quickly escalating conflict over Nagorno-Karabkh, a region home to Armenians but technically a territory of Azerbaijan. Turkey directly supports Azerbaijan, while Russia, which has a military base in Armenia, has sided against Azerbaijan.

Democratic conditions in Belarus have continued to worsen in recent weeks. The Lukashenko regime has ousted journalists from the country, a worrying sign of a weakened government escalating its crackdown on calls for a peaceful transition of power. In a further deterioration of diplomatic relations, Belarus recently requested that the Polish and Lithuanian ambassadors to Minsk to scale back diplomatic staff. Belarus has recalled its own Ambassadors from both countries. On October 2, the EU announced sanctions against 40 Belarusian officials in response to what the EU views as illegitimate elections. President Lukashenko, however, was not among the officials sanctioned, leading critics to call for stronger EU action against the incumbent.

Meanwhile, opposition leader Svetlana Tikhanovskaya is attempting to build a shadow government from abroad. French President Macron and German Chancellor Merkel have both met with Tiukhanovskaya, bolstering her cause and credibility.

Conclusion

Euroskeptic voices seemed loud in the spring, but recent months have demonstrated a willingness by Member States to work together to fortify the foundations that underly European democracy. Regarding the U.S., Charles Michel recently said, “we cannot ignore an increasing number of geopolitical choices that run contrary to Europe’s interests. Weakening multilateralism. Withdrawing from the Paris Agreements. Pulling out of the Iran nuclear deal. Flirting with protectionism.” Nevertheless, he affirmed the European “wish to remain…a steadfast and loyal ally of the United States.” Thus, the EU joins the rest of the world in anxiously awaiting the results of the U.S. presidential election, hoping to return to some semblance of normalcy.

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