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Strategies & Market Trends : Investment in Russia and Eastern Europe

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To: Real Man who wrote (814)11/17/1998 12:06:00 AM
From: CIMA   of 1301
 
Notion of Independent European Security Apparatus Gains Steam

During a meeting in Vienna on November 16, European foreign and
defense ministers considered the possible integration of the
Western European Union (WEU) as the full-fledged military arm of
the European Union (EU). On the agenda was the implementation of
the Amsterdam Treaty, which was meant to achieve a new, enlarged
role for the EU in European defense and security policies.
Highlighting the importance of this meeting, delegates from
almost every European country were present, including
representatives of the 15 European countries that make up the EU,
the European countries that are not members of the EU but belong
to NATO – i.e., Iceland, Norway and Turkey -- and the ten other
European countries that are slated to join the EU in the near
future.

For some time a majority of European countries have been actively
lobbying for the full-fledged development of the WEU into an EU
security apparatus. Yet at the EU summit in Amsterdam last year,
British Prime Minister Tony Blair staved off a Franco-German
proposal for the EU to set a timetable for a merger with the WEU.
Last month, however, British Prime Minster Tony Blair
unexpectedly announced that the UK would consider various means
by which Europe could respond swiftly and responsively to those
crises where the U.S. is reluctant to commit itself.

This is a radical shift in British policy. In the past, British
foreign policy has been intricately linked to U.S. policy. This
is the main reason why Britain has, up until now, postponed calls
for stronger role for the independent WEU and has even suggested
the abolition of the WEU in favor of a simpler arrangement
between the EU and NATO. Britain's main concern was that a self-
sufficient European defense entity would erode Washington's
commitment to Europe through NATO.

The apparent change of heart on the part of the British can be
linked to the latest crises that have undermined the
effectiveness of NATO and other U.S.-backed security guarantees
that either did not materialize or, when they did, the commitment
of support was too little too late. Situations such as Bosnia,
Kosovo, and the most recent standoff with Iraq are perfect
examples of Britain's increasing displeasure with erratic U.S.
leadership.

In the case of the recent Iraq crisis, Britain was the only EU
member to pledge forces for attacks against Iraq. The other EU
powers remained indifferent or hostile to the U.S. attempt to
force Iraq to comply with the relevant UN resolutions. Once the
attacks failed to materialize, Britain found itself out on a limb
vis-a-vis the EU, and is therefore more willing to acquiesce in a
call for developing a European security apparatus independent of
NATO. That is not to say that Britain has abandoned its support
for NATO. To the contrary, under the British proposal that is
being considered in Vienna, EU ministers would first decide on a
strategy for responding to a crisis and then would then task NATO
with the responsibility of military implementation.

However, other European countries are opposed to such a plan
because they believe that the proposal would defeat the objective
of Europe being able to act independently of the dominant NATO
power, the U.S. Germany's new Defense Minister, Rudolf
Scharping, who is in the midst of drastically restructuring the
German defense forces, bluntly stated "As Europeans we must
overcome our weakness instead of complaining about the U.S.
always leading." Germany has been the leading proponent of such
an entity, with the proposal gaining even more impetus since
Gerhard Schroder has taken office as Germany's new Chancellor.

There are three reasons for Germany having taken the lead on this
issue. First, Germany has expressed concern that much of the
armament manufacturing in Europe is duplicative. By unifying
purchasing of defense equipment in one agency, the Europeans
would enhance the efficiency of their defense industries and in
all likelihood make their products ultimately more competitive on
the world market. Second, Schroeder's Social Democrats and their
Green partners have a history of visceral opposition to U.S.
policies and leadership, particularly in the field of defense.
Third, Germany has no wish to become involved in renewed U.S.-
Russian tension in Eastern Europe. The U.S.-directed expansion
of NATO into Central and Eastern Europe has drawn sharp Russian
criticism, and Moscow has even flirted with enlarging its
federation with Belarus by including Yugoslavia in response to
NATO moves.

Here it is significant to note the growing German-led policy of
engagement with Russia. Schroeder met with Russian Prime
Minister Yevgeny Primakov this week in order to find a possible
"European solution" to the Russian financial crisis, one that
would be independent of other aid plans. German banks were left
exposed by the Russian financial collapse, and the failure of the
U.S.-backed IMF proposals to gain support in Russia left Germany
to seek its own course in dealing with Russian defaults on German
bank loans.

The same countries that are seeking military security through
membership in NATO also desire membership in the EU. Therefore,
one way of simultaneously reducing U.S. influence and decreasing
tension with Russia would be to offer Central and Eastern
European candidates for membership in the EU an alternative
European solution to their concern over national security by
creating a more active WEU integrated into the existing EU
framework. Indeed, the centerpiece of the WEU becoming a more
active entity is the fact that it will be able to project
influence and security eastward, thereby reducing Europe's
reliance on the U.S. While Britain proposes an independent WEU
that is complementary to NATO but is also capable of action
independent of U.S. support, a European military alliance,
established specifically to act where the U.S. and NATO are
unwilling, would effectively make NATO's role in the post-Cold
War Europe superfluous.

There is one problem with this. While Germany and Europe share a
desire for defense options independent of the ambiguous policies
and political constraints imposed by the United States, Germany
is not so certain about expanding the EU eastward. Germany
recently led the call to delay the entry of Central and Eastern
European candidates into the EU, out of a reasonable concern that
new migrants from Eastern Europe would drive up the already high
unemployment rates in Germany. On November 13, referring to
Germany's position during the recent EU summit in Austria, Czech
President Vaclav Havel stated, "The process of integration of
Europe should stand above partial interests of individual EU
member states." Commenting on attempts by Germany and other
Western European countries to delay EU expansion, Havel added,
"The historical sense of the process is being forgotten, which is
dangerous." Havel then played a historical card of his own,
turning to France to counter Germany's opposition. Havel
appealed to French Prime Minister Lionel Jospin to champion the
cause of EU expansion. Said Havel, "I believe that it could be
France who could make an important contribution because it has
been France who, in modern history at least, has been
traditionally bringing interesting ideas and spiritual and
visionary suggestions."

With Britain's compromise on the WEU, Germany's disdain for U.S.
leadership, and Havel's appeal to France for support, the
question of expanded membership and roles for the EU and the WEU
becomes suddenly more interesting. U.S. influence in Europe is
clearly waning, but as that happens, the traditional power games
between Europe's major powers will resurface. We await France's
response to Havel.

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