The euro has been a major success since its launch in 1999. Do we need to give greater representation and visibility to the eurozone in international financial institutions like the G-8 and the IMF to better reflect the euro’s importance?
The euro has emerged as the second most important international currency after the US dollar, yet the Eurogroup, the Commission and the European Central Bank are represented to varying degrees in different international financial fora. A substantial amount of co-ordination already takes place, but a stronger impact could be made if the members of the eurozone were represented in a more coherent fashion − eventually even a single representative would strengthen political unity and influence through combined weight.
The EU has policies for the environment and for sustainable development and it is trying to create a common energy policy. The new Reform Treaty provides a legal base for a common energy policy. How should energy and environmental policy be combined over the next 50 years to address global challenges like climate change?
Energy and environmental issues need to be treated in parallel. Our energy policy must reflect our political priority of reducing the effects of climate change. Not everyone seems convinced of the urgent need for action, but the extreme weather conditions in Europe this summer, from floods in the UK to heat waves in south eastern Europe suggest that our weather patterns are shifting and that we need to take action swiftly to avoid repeated natural disasters. The UN intergovernmental panel on climate change estimates global temperatures will rise between 1.4° − 5.8° by the turn of the century unless we act now. We have to limit the increase to 2° − the maximum possible before major environmental change occurs.
Global demand for energy is increasing as countries like China and India join the high polluting industrialised countries of the West. Europe already imports 50% of its total energy needs. This will climb to 70% within 15 years if we do not alter our behaviour.
The European Commission produced a document at the beginning of the year linking both energy and climate change policy and setting the challenge to develop an environmentally sustainable energy policy − reducing our energy consumption and carbon emissions, recycling more waste, redesigning the way we package our goods, investing more in renewable energies and biomass, reducing our dependence on fossil fuels etc. Institutions and governments can set targets, of course, but we all as individuals need to contribute by making changes to our behaviour − offsetting travel, switching off unused appliances, recycling waste, insulating homes, reducing energy consumption and so on.
There is no point in just a few people changing their habits. Nor can any individual member state effect change alone. It needs to be a common effort, based on a strategic overview, and with regulations which require certain minimum standards. Unfortunately, it is too late for voluntarist approaches.
Europe’s social model is coming under pressure from the forces of globalisation. What will be the major social challenges for the EU over the next 50 years?
Globalisation has brought incontestable benefits to businesses and consumers alike by opening up opportunities, improving access for investment, offering more choice and lowering prices. Unfortunately the benefits are not all equally felt or distributed, and that has posed a number of new challenges for society. The main one is the out-sourcing of jobs and operations as businesses are attracted by lower labour costs. Protectionism is not however an acceptable response. We should be responding with flexicurity – combining social protection with greater flexibility. This means protecting vulnerable people, not protecting unproductive jobs.
European countries need to act in several ways. First, our own labour markets need to become more flexible in adapting to changing circumstances and new industries. Second, skill levels also need to be lifted and focused more on the new and emerging economy, notably in research and technology, services and other areas in which the European Union has an economic lead. It is primarily by remaining competitive in the global economy that Europe can best guarantee employment levels.
What are the current strategic challenges that will determine the role and place of Europe in the world for the next 50?
The world is shrinking; goods are shipped across the globe and we can pick up the phone or e-mail relatives and business partners on the other side of the world. Our energy supply, though, is crucial to the whole economy. Without energy, nothing moves. We cannot make calls, surf the net, transport goods or refrigerate food. Addressing future energy needs is the most fundamental and urgent challenge we face. It requires a comprehensive and sustainable approach that takes account of concerns about climate change as well security and reliability of energy from third countries. It is an issue which transcends national borders and requires a focused and united effort by all member states acting together.
The European Union has already taken a lead on climate change by setting ambitious policy goals and agreeing to reduce emissions by 20%, to develop serious renewable energy sources and attempt to convince its global partners to follow suit. The negotiations on a replacement to the Kyoto Treaty will show whether it has been successful.
Terrorism is also becoming a lamentable feature of the 21st century, and one likely to continue for the foreseeable future. International terrorist cells of radical Islamic fundamentalists are operating with relative impunity, causing carnage and leading governments the world over to restrict long-held civil liberties. Only Europe acting together has the capacity to address the problem and tackle the symptoms as well as the root causes.
Keeping a lid on nuclear proliferation is another strategic challenge for the Union as a whole. Europe must use its international influence to uphold strategic arms limitation agreements that have maintained a fragile peace for 30 years or more and discourage a new and more unpredictable arms race.
Graham Watson, leader of the Alliance of Liberals and Democrats for Europe, was interviewed for Europe’s World by journalist Simon Taylor. This section is supported by the ALDE Group (http://www.alde.eu)