[romania_eu_list] Merkel could transform EU

[Mihai Zodian]

Merkel could transform EU
Fri Sep 9, 2005 1:25 PM BST 
By Paul Taylor, European Affairs Editor
BRUSSELS (Reuters) - Angela Merkel could transform the European Union, but it is not clear whether the conservative German opposition leader will seize the opportunity, even assuming she wins a general election in nine days' time.
Merkel has called for economic reforms to rekindle Germany's sluggish economy, vowed to take greater account of smaller European partners and neighbours, and criticised the EU's costly farm subsidy policy that mostly benefits France.
That has prompted speculation about shifting alliances within the 25-nation EU and new momentum to overhaul Europe's creaking economic and social model, possibly in partnership with free-marketeering Britain.
But the reality may be less radical, especially if an inconclusive vote forces her Christian Democrats (CDU) to form a coalition with the centre-left Social Democrats (SPD) rather than an alliance with the economically liberal Free Democrats.
"She could put herself at the head of a movement for reform in Europe. It all depends on her determination to exercise leadership," said Jean Pisani-Ferry, a former economic adviser to the French government who heads the Bruegel economic think-tank in Brussels.
"She has declared her intention to reform in several areas, particularly labour markets and fiscal policy, with flatter taxes. That's bound to carry others along with it given Germany's size," he said.
But he noted that SPD Chancellor Gerhard Schroeder had kept his Agenda 2010 of labour market and welfare reforms a purely national programme without trying to galvanise even the 12 countries that share the euro single currency.
HARD CORE?
Under Schroeder, Germany and France renewed their close alliance after a period of estrangement, but it was often to resist change rather than promote it.
The Franco-German axis, which was in the vanguard of European integration from the 1950s to the early 1990s, was no longer able to exert strong leadership in an enlarged Union, whether on the Iraq war, the EU budget or economic policy.
They acted jointly to brake economic liberalisation, notably in cross-border services, loosen fiscal discipline and perpetuate the EU's Common Agricultural Policy.
"During the last three years, Schroeder has revived Germany's close relations with France in ways that damaged ties with the United States, the UK and the countries of central and Eastern Europe," Charles Grant, director of the London-based Centre for European Reform, wrote in an essay.
"Germany will not be able to restore its position as one of the EU's natural leaders so long as its economy continues to stagnate," said Grant.
He argued that the next Berlin government should take a lead in reinvigorating the EU's Lisbon process of economic reform, continuing to work with France but involving Britain, Spain, Poland and smaller countries more frequently.
Senior Polish conservative Jaczek Saryusz-Wolski, tipped as a possible foreign minister after parliamentary elections to be held this month, told Reuters he expected Merkel to help lead a more pro-American, pro-business Europe that would take a more united and critical approach towards Russia.
The new German government will take office at a time when European integration has been halted, at least temporarily, by the French and Dutch votes against the EU constitution, casting doubt on the pace of further enlargement of the bloc.
Merkel has made CDU veteran Wolfgang Schaueble her top foreign affairs adviser. He co-authored a report in the mid-1990s calling for a hard core of EU countries around Germany and France to move forward faster with integration.
But he seems unlikely to become foreign minister, a job usually reserved for the junior coalition partner, and Merkel's emphasis on rebuilding damaged ties with Poland and Germany's central European hinterland runs counter to the hard core idea.
Merkel's opposition to Turkish membership puts her at odds with the central Europeans, as well as with Britain and the United States. But she made clear in a television debate with Schroeder that she would not block the planned start of accession negotiations on October 3.
http://today.reuters.co.uk/news/newsArticle.aspx?type=reutersEdge&storyID=2005-09-09T122447Z_01_NOA944497_RTRUKOC_0_ANALYSIS-MERKEL-EU.xml
 
		 
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