FIIA Webinar: Strategic autonomy and the transformation of the EU
[FIIA introductory music] [Aaltola:] Your excellencies, ladies and gentlemen, - it is my great pleasure to open this special event - titled "Strategic Autonomy and the Transformation of the European Union". I'm Mika Aaltola, - Director of the Finnish Institute of International Affairs. And I would like to thank the co-organisers - Jacques Delors Center and Egmont Institute - on coming together and pulling off this event this afternoon. The topic is very acute from multiple perspectives. Different qualifiers of sovereignty such as autonomy - have become buzzwords lately.
They indicate something concerning the political and geopolitical environment - that we are all living in in today's world. Confusion, complexity, and ambiguity prevail - while still the fabric of criss-crossing interdependencies - are still in paramount position. This increasingly complex and competitive international environment - is pushing the European Union and its member states - to re-think some foundation stones - of the Unions economic, foreign, and security policy. It is this conjunction, - and I try to be as concise and vague as possible - in order to allow the real experts - to have their word on the topic. But I have to say that one key part of this event today - is that it also marks the launching of a FIIA report, - "Strategic Autonomy and the Transformation of the EU:- "New Agendas for Security, Diplomacy, Trade and Technology” It is the fruit of our FIIA project on European strategic autonomy - in a geo-economic world led by Niklas Helwig.
I had the privilege of reviewing the report - and I have to say it is a must-read for all those interested - and who wouldn't be, - on European strategic autonomy. Next I will introduce the Chair, the moderator of the event. It is a pleasure Tania Lațici is taking the lead - in taking us deeper into the conversation today. She's currently a policy analyst on security and defence - in the European Parliamentary Research Service. In a way FIIA's sister institute. It is an in-house think tank of the European Parliament.
She has a great publication record - on matters related to EU security and defence policy, - as well as transatlantic relations. She has worked in the NATO Parliamentary Assembly - and the transatlantic relations division of the European External Action Service. Currently she is also Associate Fellow - with the Egmont Royal Institute for International Relations, - and a Member of Women in International Security Brussels, and an Associate Expert at the New Strategy Center. So Tania, the Teams floor is all yours.
[Lațici:] Thank you very much for the floor - and for the very generous introduction. I hope I didn't bore everyone already with all my hats. And thank you first of all for offering me the pleasure - of moderating this really wonderful event with such a stellar panel. So we have gathered here today in front of our screens - in front of our laptops, next to our coffees, - I join you on this one to talk about a topic that, as said, has really captured the spotlight of the EU policy debates. Strategic autonomy.
So this debate is wonderfully captured by a very rich report - launched today by FIIA, - and with which I happily spent a very entertaining Sunday afternoon - last weekend. Today as this report was launched - we're going to hear from several of the analysts that contributed to it - and will discuss strategic autonomy from different perspectives. So we'll also get a bit of an insider's view - on how strategic autonomy and some of the points the report touches upon - are seen from the engine of the European Union. So from inside the EU.
Now before handing over to our speakers, - let me mention that there will be a Q&A after their interventions - and you'll get the chance to pose your questions. Please don't make them easy. And please also state your affiliation, as per FIIA instructions - when you post your question. I will then collect them and use my very extensive powers as moderator - to post them to our speakers.
And if you want to make my job as moderator and multitasker easier, - you will already think about and pose your questions, - no need to wait until the very end. So without further ado let me introduce our first speaker, - Niklas Helwig who is a Leading Researcher, - not a bad title, at FIIA, - focussing on EU and Germany's foreign and security policy, - as well as transatlantic security. So he will introduce the main findings of the report. Niklas the floor is yours. [Helwig:] Thank you Tania for this introduction - and already setting the scene a bit on the European strategic autonomy debate. Yes Leading Researcher is funny.
They introduced this title because you actually lead a project. And this is the project I was leading for the last year - on European strategic autonomy - and where we today, luckily and finally, - are able to present our report. And let me first thank all of the contributors and authors - who contributed to that. Nicole and Tobias who will speak later but there are also other contributors. And there are also other project team members - who gave their feedback in several workshops we had last year. And you should check out the front page of our FIIA website - because there are some other applications - related to strategic autonomy - from some of our project colleagues.
So this is not the only outcome of the project - that I had the privilege of leading in the last year. So we started with the project just before the Covid-19 pandemic. And we didn't know then that the pandemic - would raise the attention - on the question of strategic autonomy much more in the way it actually did. And this is the first point I want to make. As a consequence of the pandemic - that also accelerated many of the disruptive trends - in international politics that we see today, - the debate on European strategic autonomy - has taken on a new relevance. And it's also here to stay.
30 years ago, when we talked about strategic autonomy - it was a really a narrow field. Think about the Saint-Malo Summit, for example, - that launched the common security and defence policy. It was really about military capabilities, - crisis management capabilities, - and the question of how Europeans should organise their security and defence - behind the possibility of a retreat from US, from Europe, - in the Cold War context. But since then we've come a long way - and today the strategic autonomy concept is much broader, - much more global in nature.
And that's also because there are completely different drivers today - that we're seeing. The EU is thinking about its capacity to act - because of the intensifying competition between China and the US - that really affects global politics and global supply chains and markets. It's because of the break-neck speed of the technological transformation - that affects our industries as well as our societies - and because global interdependencies, economic interdependencies - are not neutral any more.
They are not caring any more. They are not the safety net any more. But they're used by big powers - to further their geo-strategic goals as well. And recall this in the report, leveraged interdependence. Think for example about the US extra-territorial sanctions - in relation to the Iran nuclear deal. So as a consequence, - today interdependence carries a lot of risks as well - and not only opportunities. And strategic autonomy is really about - how can we manage our interdependencies with a wider world - better in a more efficient way.
That goes across policy fields. And in our report we look at defence policy, - we look at diplomacy, trade, and investment - as well as technology. The second point I want to make is that - it's no longer a question - whether we want to be strategic autonomous or not, - but it's more the question of how we can actually achieve strategic autonomy. It's more about the how and not the if. And an important point that we make in the report - is that autonomy is not only advanced through protectionism. It's not only about isolating yourself, - it's not only about decoupling from the rest of the world.
And instead we define three approaches to strategic autonomy - in the beginning of the report. One is autonomy through protection. That is one element but it's not the whole question. But of course it is a certain element of the discussion.
Where do we have to be protectionist in a very targeted way, - how do we build up strategic capacities - to identify critical sectors in which we maybe need to protect supply chains, - and to what extent do we want to use trade instruments - to protect our values? For example in connection with the climate change agenda - and the carbon border adjustment tax. are trade instruments a way to advance values, to protect our values? So this protectionist question is in there - but it's not the whole story. Strategic autonomy can also be advanced - by supporting our economic and political foundation - at our home in the EU.
And that we call the report "autonomy through provision." Think about the rescue package related to the Covid-19 crisis - that hopefully the Finnish parliament will also pass - because there is some political turmoil here in Finland. But that's a different story. And finally strategic autonomy is also about - protection of our interests and values abroad. So it's about the EU shaping the international environment - in a way that's supportive of our interests and values.
There you can for example think about the EU's efforts - in reforming the WTO. So all of these elements, protection, provision, projection, - they all form an important part in advancing strategic autonomy - but there are also tensions between those different goals. And there are policy choices to be made. And I think that is also important to highlight.
Just one example, - because we have Monsieur Arbault from the Commission here, - one example is the EU defence industrial policies. When we look at defence policies - there's a clear emphasis on autonomy through provision - at the moment. One example is the European defence fund - and how it supports research and development - in the European defence industries. And that is generally seen as positive.
But there are also discussions and debates - around some of the protectionist elements in the defence policy. For example Finland and Sweden have been very outspoken - and supportive of third-party participation - within the permanent structured cooperation. To what extent the EU outsiders - can participate in the European defence fund - is a more complicated story.
There are different issues connected with that. But that is also part of the debate. So how much protectionist elements - are also in some of these defence initiatives - is a question.
And then to what extent the defence initiatives - support the ability to project our values and interests internationally. That is also hotly debated. Proponents of EU defence policy cooperation, - they say that with the help of these initiatives, - we will be more efficient in the long run - in securing our neighbourhood. We will be better partners with the US in the future - because we create better capabilities. But there are also sceptics - that highlight that these EU defence initiatives - might undermine the close defence industrial ties - that some member states have with the United States, - which are also in support of our security.
So there are arguments and debates - and that is the general point I want to make here. In each of these policy fields we look at, - there are certain trade-offs and policy decisions - and hard choices to be made - in the pursuit of strategic autonomy. We also make some recommendations in the report - and you can find them at the beginning of each chapter.
And obviously I can't go through everything. In the beginning we give some high-level recommendations - and there we were maybe a bit creative. Some of you might remember that Josep Borrell, - the High Representative of the EU last year, - promoted his Sinatra Doctrine.
"My Way" should be the motto of the European Union. So we thought hey that's a great chance - to promote our own views and interests, so you find a couple of our own doctrines here. I personally put in the Oasis doctrine. But one I want to highlight here is the Elvis doctrine.
"A little less conversation, a little more action." So what we want to say by this - is that there's still a fair amount of less controversial homework to be done - that in itself will bring the EU forward on some of these issues. And I think Nicole and Tobias will probably address - later in their interventions - some concrete initiatives discussed in the fields of trade and defence policy. But let me just add, - because we have no one representing the technology part. Technology was really an important discussion in our report.
And you find the discussion of technological autonomy - actually in all the chapters in some way or form. And it seems that making progress on technological autonomy - is a very important point. And so one specific action that we propose there - is of course on the radar of the Commission already. But it's really about bringing - the transatlantic technological alliance forward - and fast-tracking this somehow.
The EU already made the proposal to the US administration - to set up a technological and trade council. But we're still waiting to hear how this will further develop. The EU's ability to protect its norms in this technological transformation - is really at the centre of this strategic autonomy debate - and that we try to highlight as well in the report. Those were my initial points - and I really look forward to the discussion today. [Lațici:] Thank you very much Niklas - for this comprehensive outline - which really sets the stage for our debate today - and puts into political context these three forms of autonomy - that the report identifies, protection, provision, projection.
I dare you to try to say these three times faster. But now everyone got the ultimate teaser to go and read the report - on the FIIA website - and we also got an Elvis earworm from you Niklas so thanks for that. Next we're going to hear how all of these issues - and the wider theme of strategic autonomy - are viewed inside the Commission - from someone who has a number of impressive posts in the EU administration - under his belt. Our next speaker is François Arbault - who is currently Director for Defence Industry - at the European Commission, - dealing with all these super interesting European defence topics - that me and others here present love to talk about. So François the floor is yours. [Arbault:] Thank you very much Tania - and thank you for having me here, that's a pleasure.
I looked with great interest at the report - and I like very much what you said at the beginning - that indeed we should rather concentrate on the "how". I think we have to think about the how rather than the whether or the why. And I think if you honestly answer the why, - I think the whether is water under the bridge. Indeed we have to focus on the how - to actually make sure we develop our strategic autonomy. And again, I don't want to dwell on all the conceptual debates around that.
There are a number of very good reasons which we are all aware - that plays in the favour of the EU, - giving itself a stronger capacity of autonomous action. And of course without any prejudice to the ambition - to act with other like-minded whenever possible. I think it's always better to be able to make autonomous decisions- on the basis of information you gather on your own autonomously. So you keep that freedom of action. So the question is the how. I think there are two important dimensions.
I would say there is a more offensive dimension - which amounts to how to create the conditions - of a greater collective determination of the Europeans, - the member states, - to join forces and efforts to actually strengthen - the European defence technological and industrial base. And I think that's a key element that we have to keep in mind. There's also a more protective dimension strategy - which is how we can actually make sure - we identify and minimise potential dependencies. Of course if you want to be autonomous - you have to be sure that you can actually deploy a number of means, - rely on a number of technologies, - without having to ask the questions of those actually countering that. You don't want to ask the questions to your potential enemies - and possibly also, not necessarily, - to your like-minded, - because there can be very different situations. So when it comes to the offensive dimension, - I think the EDF is of course a major breakthrough - because for the first time we have a collective display of ambition - to allocate a significant sum of the EU budget to a collective effort - to develop the industrial cooperation.
And I think that's absolutely essential and I would like to focus on that. As you've also seen, the Commission is really accelerating its efforts - to also work on the protective dimension - by displaying an ambition to work on the mapping of critical technologies, - identifying the dependencies and actually acting on them - in terms of investment on where we need that investment to take place. I would like to focus for a few minutes on this question of the EDF - and how to actually create what we call this affectio societatis - between the member states.
I think that's the essential element - that's the key of the answer to the question - how can we actually develop that strategic autonomy. For the first time we have eight billion from the EU budget - to be spent on a collective effort. But now we have to create the conditions of that motivation, - that collective understanding that sees the necessity - to develop that cross-border cooperation. I think the primary reasons why it makes sense to cooperate - are absolutely obvious. Of course you mutualise your investment capacity so you have more money - because no member state is able to develop that effort alone. In any case, even if we had the means it would be inefficient.
So mutulisation is of the essence. I think there's also an intrinsic value in confronting cultures - because innovation which is of course what we're looking for - is actually emerging from the confrontation of different cultures, - of innovation of industry. So we see it's very much needed. A key element of strategic autonomy, - and that's why I call it the offensive dimension of it, - is of course to be able to stay ahead of the curve. So there is a huge competitive dimension of our industry to it.
So this is about staying ahead of the curve in terms of innovation. And for that we need more means - and also we need to broaden the scope of our collective efforts - because we see that the innovation upon which defence capacities have to rely - are much broader than they used to be. You can no longer carve out the defence sector - in terms of specific innovation needs. The innovation is coming from the civil sector, the space sector, - so there is a kind of unification. And with regards of the need to demonstrate - that member states have collective interest to strengthen the ambition, - I think the fact that we see a unification of threats, - I mean this is not the matter of the day - but let's say the hybridisation of different threats - is a situation we witness everyday.
I think indeed there is a convergence of all the technologies as already said. And those two elements mean that the sheer need - of deploying a greater ambition - is something that becomes a tangible reality for every single member state. And not only member states which already and historically consent - a very strong effort in research innovation in the field of defence. So I'm saying that because - when it comes to that very challenging mission - of creating that affectio societatis, - we should build on the fact that indeed hybridisation, - unification of technologies, - mean that every member state will better see - what they can contribute to that collective effort. Because the challenge in that - eight billion of EU budget to be spent. We know traditionally that the big industries in the sector of defence - are not evenly distributed among the member states.
And so there is a culture of research innovation in the sector of defence, - the other member states who are more of the [inaudible] So how can we create that affectio societatis. That's absolutely key. And the EDF is there to demonstrate - that the increasing effort can be meaningful - for every single member state I think if we want to succeed in our efforts, - the plan is to ensure that at the end of the MMF cycle, - every member state agrees on the fact - that we have to actually continue the experience - but possibly enhance it - because every member state, every industry, - respective of its structure and positioning, - every member state has made the tangible experience - that they tangibly contributed to the collective effort - and that they benefited of course from that collective endeavour. So the EDF will actually knit together the member states - project by project, - creating those "solidarité de fête" - if I can refer to Schuman, - so it becomes more of a reflex - to say yes we have everything to gain in joining forces.
Because for example - as innovation is coming more from non-traditional players, - every single member state has the the SMEs, - that are the top of the edge in certain sectors - and therefore can contribute to a more thriving EDTIB. That's one thing. On the resilience aspect, - and I'll stop here because I'm too long already, - but you know that we have new measures in place. We have the Synergies Action Plan, - the Observatory of Critical Technologies that is being ramped up. The European Council has tasked the Commission - to come up with a technology roadmap by October this year.
I'll spare you all the details because you will know where to find it, - but we act on those two legs. The offensive dimension and the more protective. But I can only insist on the need for the EDF to demonstrate - that every member state can really tangibly contribute - if we are really deploying together new projects - which are very inclusive by nature, - but are also meaningful in terms of what we actually supply - in terms of equipment to the armed forces. I'll stop here. I'm sorry if I was a bit too long already.
[Lațici:] Merci beaucoup François. It's really very valuable to hear from you, - especially since you really see first hand - how the sausage of European defence is made. So that was very useful.
So now after getting this reality check from the Commission's side, - I have the utmost pleasure in introducing our next speaker, - who wrote an excellent chapter in this report - focussing on the defence dimension of strategic autonomy. So on this we're going to hear from Nicole Koenig - who is Deputy Director at the Jacques Delors Centre in Berlin - and who is foremost expert on everything EU foreign and security policy, - the EU's institutional labyrinth, and migration policy. So in your chapter Nicole - you diagnose that on the one hand - there's this gap between ambition and reality - that reduces the credibility of any EU strategic autonomy in defence, - and then on the other hand there are also these diverging strategic cultures - that are among the key obstacles to achieving this autonomy. These are also issues that François pointed out. He said we need to broaden the scope of our collective efforts - and create this solidarity reflex.
So I look forward to hearing your insights - on how we can reduce these gaps - and how do you see the ongoing strategic compass process playing out. And let me remind the audience to already post questions in the chat. Thank you Nicole the floor is yours. [Koenig:] Thank you very much Tania I hope you can all hear me.
Welcome also on behalf of the Jacques Delors Centre. And thank you very much to FIIA and Egmont for co-hosting this event - and I guess my special thanks goes to Niklas, - who as a Lead Researcher did an excellent job - in bringing us all together - and keeping us on track for this report. Now Tania as you mentioned, I had a look in my chapter at the defence dimension. And this defence dimension is very much the narrow concept - of strategic autonomy. It's the more traditional dimension of strategic autonomy - and I think you see a bit of a paradox.
On the one hand - it's also this dimension where it's an agreed objective, - it's an overarching objective of the EU global strategy. But as you said Tania, - it's also the area where it's the most sensitive dimension - of strategic autonomy I would argue - and the most contested one. And also still the one where the gap between ambition and reality is wide. And what I did in my chapter is to go through - three dimensions of strategic autonomy - and really look at developments since 2016 - to see what has happened in these dimensions - and what hasn't happened. So I'll briefly take you through these three dimensions - and then go into recommendations. Now the first is the political dimension of strategic autonomy.
And the way I define that is that - we really need a joint vision and understanding - of strategic autonomy, - of what that means and what the appropriate degree is. And as you said Tania what I argue in my chapter - is that here the key obstacle - is still the difference strategic cultures - and different threat perceptions of the member states. So the most controversial question that strategic autonomy raises - is always strategic autonomy from whom? I think this question is very much tied to NATO and the US - and therefore it divides Europeanists and Atlanticists in the EU. And I think if we look back to the past years, - we could see that the Trump administration - and also Brexit were drivers behind strategic autonomy, - not least because both actually strengthened the Atlanticist camp. Then came the Biden victory and then we had this debate - that you will remember - on whether strategic autonomy is actually an illusion - or whether it's an imperative. We had this debate between Annegret Kramp-Karrenbauer and Macron.
And we had this fear that the centre of gravity is shifting back - to the Atlanticist camp - and that the efforts behind strategic autonomy in defence are losing steam. Then we move to this question that the others have mentioned, - the strategic autonomy "how," to do what. And here I think this is where different threat perceptions come in. For what, - strategic autonomy for dealing with crises in the neighbourhood, - is it more the East, is it more the West? Should the EU be a regional security player, - should it be a global security player? Are we looking at traditional conventional threats - or are we looking at newer threats? We heard about hybridisation of threats, - the implications of destructive technology, - the issue that is always on the table now is access to the global commons.
So which kind of threats, - strategic autonomy for what? And here we still have divisions. And finally, again connected to strategic cultures, - strategic autonomy to do what? How do we respond to these threats? And here we have these traditional lines - between aligned and non-aligned member states, - between more interventionists and more pacifist member states, - between more activist and more restrained member states. So these are the divides - that stand in the way of coming together on a common understanding - of what strategic autonomy means. And the global strategy of 2016 - did not do so much to bridge these divides. It said that yes, - there should be an appropriate degree of strategic autonomy, - but it's still a bit unclear what that means.
And to take just one example, - looking at the different threats in this strategy, - it's an extremely broad spectrum - but there are no very clear priorities. Now that much for the political dimension, - which I think is the most important one. The second is the institutional dimension, - so do we have the decision making structures and institutions - to implement strategic autonomy, to implement this common vision. And here I think since 2016 we have seen a lot of incremental progress. But also a legal ceiling in a way.
We have seen there was a debate on extending qualified majority voting - but this did not really touch on the military or defence dimension - and generally did not make a lot of progress. And then we had incremental steps towards an EU headquarters - with a military planning and conduct capability, - also because of Brexit and broadening mandate here. And we have seen, as Mr Arbault also illustrated very well, - a growing role of the Commission in the field of the defence industry - with the European Defence Fund. In a way also stretching the legal boundaries a little bit - by bringing this defence fund into the MFF - and focussing on this industrial side. But at the same time in this institutional dimension - we still also have different perspectives of the member states. And I think we saw that very much when it came to PESCO - and this debate between France and Germany - where Germany was very keen on having inclusive PESCO - whereas France was very focussed on the operational dimension - and also on this aspect of flexibility.
And what we also see in terms of projection of strategic autonomy - is a growing number of coalitions of the willing, - European coalitions of the willing, - rather than bigger EU missions. And finally the third dimension is this material dimension. So if you have a common vision, the institutions, - you also of course need the means. And again since 2016 - the initiative have very much focussed on this material dimension - and we have heard all the developments that Mr Arbault described. But still if we look at the recent CARD report - we can still say it's actually not enough. So the impact of these new initiatives is there - but it's still limited.
So for example the findings of this CARD report - were not yet included in national defence planning. There's still too little investment in research and technology - on the side of the member states - and the outlook is not very promising. There's still not enough collaborative spending in the field of defence. And yes we have the European Defence Fund - but let's not forget that the ambition was lowered - compared to initial Commission proposal - by almost 40% in terms of volume - and at the same time we are in the context of a global pandemic. And the outlook on national defence spending is still rather uncertain.
So what we face is really a growing threat of requirements - hybridisation of threats, - a 300 degree threat analysis that we had that illustrates this breadth. But at the same time this growing number of requirements means that - even if we continue with the same amount of spending - the EU could easily be overstretched. So moving to the recommendations.
First I agree very much with what Mr Arbault said, - that it's important to move away from conceptual debates. In the field of defence in particular, - strategic autonomy is an agreed objective - and the question is not so much from whom we are independent - but more for what - and what do we want to be able to do autonomously if we have to. I think this is the key question for the strategic compass. And I think what should happen here, - I mean we're now in the process - where the member states are discussing, - the final product should be published in March next year, - and I think what's important here is to have a more concrete level of ambition - in terms of EU crisis management.
So to really discuss the political criteria, - what we want to be able to achieve - in a case where perhaps the US or NATO are not interested. And the second is this whole broader area of access to the global commons. And I think here it will also be important to define - what is actually a common area - or what are common areas of European interest. Do we focus on maritime presences, - what do we want to be able to do in terms of securing the airspace, - what should be our cyber capacity and so on. So to have a clearer vision of that.
I think in terms of institutional autonomy - qualified majority voting will not be on the cards - in the military domain for a long time I think. So I think here the next step should be - to really upgrade the EU's integrated approach. And I think both at headquarters level and on the ground. In terms of the headquarters level - I think there still could be some steps - towards strengthening the civil-military dimension of planning - and also the civil-military dimension of the MPCC cooperation with CPCC, - through civilian military crisis management. Another step in addition to this integrated approach - is to think about how we can bring together - flexible coalitions of the willing - and the EU framework.
So here I think it would be good to explore the implementation of Article 44, - so to really think about situations - where we could bring a European coalition of the willing, - into the EU framework - and what kind of incentives would be needed - for this coalition of the willing to move into the EU framework - and for the other EU member states to get on board. And finally on material autonomy - I think Mr Arbault already mentioned or explained it very well, - I think the key question will be - how to maximise the benefits of the EU mechanisms. And I think we need a closer match between the operational scenarios - that will be developed by the strategic compass, - the next CARD review, - the European Defence Fund, - and also the PESCO projects - so that there's a closer match.
And I think the other point Mr Arbault mentioned... Because we're facing this broadening amount of threats - and the resources at the EU level are simply limited, - I think it's very important to use these synergies - between defence space and civilian industries. And I think the recent Commission action plan - is probably a good step in this direction. But finally I think the key question will be - how can we foster more member state compliance - with on the one hand joint commitments, - for example PESCO commitments, - but also joint priorities. I think here for example the European Defence Agency - has proposed a more regular exchange of national and defence planners.
And that could be one path, - but also as Tania has suggested, - for example a PESCO peer review mechanism - to cross-check between the member states - whether they actually meet their common commitments. And I'll leave it at that. Thank you very much. [Lațici:] Thank you so very much Nicole - for presenting these super useful recommendations. Also thank you very much for referencing my own paper, - of course much welcomed at any point.
Thank you also for posing some of these existential questions - that really the EU has to pose for itself. So to define what kind of strategically autonomous actor it wants to be - and to do what, - and how to get member states to stick to these commitments - that they've signed up to. I certainly personally agree - with this need to strengthen the EU's integrated approach, - to have it as an over-arching guidance - of the EU handling the hybridisation of threats - as both you and François have named - and the changing power distributions. But enough from me. Now last but certainly not least - we're going to hear about a cousin of European strategic autonomy, - namely open strategic autonomy - and how to make sense of this strategic concept - in a world of growing geo-economic competition. So this is a world in which economic links - are systematically manipulated for national security purposes - and to try to see how the EU is beefing itself up to react to these trends - while also very much trying to balance this with its liberal mantra.
And I certainly can't think of anyone more suited to tell us about this - than my Egmont and otherwise partner in crime Tobias Gehrke - who is working on geo-economics as a Research Fellow at the Egmont Institute - and is also finishing up his PhD at Ghent University. So Tobias the floor is yours. [Gehrke:] Thank you very much Tania - and also hello, good afternoon from my side. And thanks Niklas and FIIA, - and the Jacques Delors Institute for hosting this together with us.
Like Tania said, in trade and investment policy - I think the debate is not so settled yet. The spectre of protectionism looms over the whole debate of strategic autonomy. I think there's a lot of EU politicians and policy makers - who've been bending backwards to fend off the fear - that autonomy might lead to protectionism.
And there's quite a lot of in-fighting also I think among the Commission - in the different directorates but also among member states - of what exactly is the balance between open economy and an autonomous economy. And so there's some sort of new creature that emerged out of this. Open strategic autonomy in a way is a compromise - among these different forces - but there remains a lot of suspicion still - on the more liberal agents in the EU - what this might mean. So despite the conceptual suspicion and often dismissal - that autonomy is not something that is in the EU interest, - I think it's quite interesting and a bit of an oddity - that on the how question, what have we actually been doing, - there's quite some movement.
We've seen so many new policies that have been coming out, - there's so many policies and trade investment policies in the pipeline, - which are in fact autonomous polities. They are often unilateral policies, - they are designed to be more assertive in defending EU interests and values. So I think that's a bit of an interesting oddity.
I'll circle back to that. But I want to start from the back. I have three quick points I want to make, - I want to ask why we've come to a more autonomous EU trade policy, - what are these new policies, - and there are many so I'll just run through them, - and then what now? What do we do with this? Maybe the most important question.
So on the why question, - we all refer to the big policy events, - Trump's trade tariffs, sanctions, et cetera. I don't want us to get bogged down in these policy events too much - because there's really a more structural transformation of the global economy - that's been going on for some time. On the one hand as Tania said, - we have great powers much more actively trying to manage and control and shape - these economic links and capabilities - in their national and strategic benefit. And make no mistake that's a really big difference I think - to how the global economy is otherwise built on the principles - of market-led integration, retreat of the State, market efficiency - that are normally structuring the global economy. And I think that's quite a big challenge that we see.
Secondly, the economic governance framework around this, - most importantly the World Trade Organisation, which is normally the player, the institution - that should keep calm on these developments, - is in really serious trouble to regulate these kinds of things. It's not just a technical question. Okay, the WTO, there's a problem with the Appellate Body, - Trump has blocked the Appellate Body, - but really more structural serious challenges - to international trade governance that we have to face. One of them is economic. The rise of China's state led capitalist system - which is heavily built on state enterprises and state subsidy.
It's a real challenge that cannot just be brushed aside easily. Secondly the interface of trade with national security. The rise of China as an innovation, economic and technological superpower, - which increasingly controls really important critical economic links - and assets. The third is a more normative one. The rise of authoritarianism and its implications and violation of values, - of human rights, - that all intersect with international trade - in a way that is quite significant.
And the WTO... I'm definitely not saying we cannot bring these topics into the WTO - but it's going to be a big task. There's no easy pickings here. So it's no surprise that the EU, but really many global powers, - are not putting all their eggs in the same basket with the WTO - but are beefing up unilateral actions. And they call it different things and we call it autonomous, geo-autonomy, - but I think it is a common trend that is important to observe. Secondly on the what question, - I think we have seen so many policies - that it's impossible to go into detail here.
For me it was important to see that EU's policies are really a reaction - to these structural challenges in the global economy. They react on different fronts: economic, security, - and on the normative front. In my chapter I tried to categorise them into four baskets of different policies. One is autonomous policies - that try to defend against the economic distortions. This is classical trade policy stuff we'd normally do in the WTO - but it's not moving ahead - so we're talking about level playing field issues, market access questions. And here the EU has really adopted a range of unilateral instruments - to defend itself, to promote its interests - from new trade defence instruments, - to foreign subsidy instruments, to enforcement mechanism - and enforcement office et cetera.
Secondly we see policies that try to defend against economic coercion. So we've seen blocking statutes and old legislation was brushed off - to defend against American financial sanctions, - but the Commission is working on a more broad anti-coercion mechanism - which will come out some time this year. And has published a lot of communication - that it wants to work on financial resilience and so forth. Thirdly we've seen policies more actively linking trade investment - with sustainability and values.
Most importantly - the Commission is also working on due diligence legislation - to be able to say we have an imports in our market, - the kind of imports we get in our market, - and we have to make sure these are compliant - with the kind of values we expect - on human rights and environmental protection most importantly. But also the carbon border adjustment mechanism, - it's still under discussion and we don't know what it will look like. But it's going to have a fundamental impact on EU trade policy, - that's for sure. And lastly policies to try to protect but also promote - critical assets and supply chains. Most importantly the investment screening regulation - which became active this year.
But also the EU recently reformed export control regulation, - it has the 5G toolbox, - but also on the promotional side a lot of investor policy initiatives - that span the whole economy. Now if we look into these policies in more detail there's lots to discuss. Are they any good and how do you actually employ them. That's also the key point in my third point. What now? Because the EU on trade and investment policy - and particularly have been pretty good to just hammer out legislation. Obviously EU competence... There's been so much going on.
But in the end you want to use it all - and how do you use it all. And even though we have a lot of these policies, - I think the recent EU trade strategy that came out just a few weeks ago - also reiterated the point that the open side of open strategic autonomy - is really the one that is the more important one. It stresses multilateral reform of the WTO - rather than unilateral instruments as the most important aspect - to achieving EU trade goals. It stresses trade agreements and multi-defensive barriers - as the ones providing a platform to pursue EU values and interests.
So there's this balance. To me, open strategic autonomy remains this equation. It's betting on both engagement and on separation simultaneously.
And for that there's a lot of pressure from certain commentators and actors - that this ambivalence of open strategic autonomy does not work, - it's kind of paradoxical. I don't agree, I think it's not paradoxical at all. It's in fact the right approach that is crafted here - with this concept of open strategic autonomy.
It's not so much the approach that's the problem, - the problem is in how do we solve that equation correctly. How do you balance these two against each other. That was mentioned already, it's essentially a political decision.
You can craft all these concepts as you like - but you have to come to the political questions. Where exactly do we draw the red lines? To what point do we engage? At what point do we then shift towards autonomous instruments? There are clearly, as Niklas mentioned, - this trade-off of interest. We can acknowledge that. It's more a question of - what do we do when they actually conflict? When is the EU ready to walk away from one goal in pursuit of another? These are really the questions at the heart, I think, - of the EU-China investment agreement - which is really at the forefront - of whether this fits in the EU strategic autonomy debate or not. I think the Commission...
Sabine Weyand of DG Trade, - she really defended investment agreement, quite rightly. She said, I think we have disagreements, we engage, - but at the same time we develop these autonomous policies - so that if our interests or values are left unsatisfied by this agreement, - we can bring in or flag our policy, our strategy, - with these autonomous unilateral policies. And that's right, it's the right approach. But the trick is when exactly is that threshold reached? And that's a discussion that's missing in the open strategic autonomy debate - where we have to have political debate in European parliaments more - about the trade-offs, - and be realistic that there are trade-offs - and try to come up with some better blueprint of how we adjudicate them. Let me stop here for now to maybe come back to some of these things - mentioned by Niklas also before about projection on EU trade.
I think that's also an important dimension in this realm. Thank you very much. [Lațici:] Thank you very much Tobias - and thank you very much to all the speakers.
You clearly nailed it. You had very good interventions - since we see the chat becoming super active. I know it's tradition for the moderator - to say how she's going to abuse her power - and ask the first question. I will try to break with this tradition - and show my appreciation for our very active audience - by moving straight to the Q&A. And perhaps I'll try to squeeze in a question later of my own. Now first for François we have Pierre Mirelle - asking whether from the eight billion allocated to the EDF - if there's an amount pre-allocated for PESCO projects.
I will complement this question by asking - what can we expect from the Commission's working programme - on the EDF and the funding priorities for this year? Then for Nicole, also Pierre has asked about strategic technological autonomy - and whether the obstacles to that are going to be internal - first and foremost - so between Atlantacists and Europeanists - or interventionists and free market supporters and so on. So if you could please comment on that. And also feel free to add not only about the internal obstacles - to strategic technological autonomy - but also about the external obstacles - and how we can balance the interests of other great powers on that debate.
And Nicole I'll pass you another question as well. I'm sure you can handle it. From Leo Michel, sorry everyone if I mispronounce your name, - on nuclear deterrents. I want to pass this to you - because I think it would be interesting to get the German perspective here. So he says that - "one sees little if any mention of nuclear deterrents - "in discussions of strategic autonomy. "Is it because it's considered off-limits by all EU actors?" So Nicole if you could comment on that.
Then for Niklas, - you're the lucky or unlucky one - who's going to get the question from Frederic Mauro - who always asks the difficult questions. He points at several definitions of strategic autonomy, - from the original then from the EU global strategy - and then open strategic autonomy. So what are we talking about here? He's asking. Then I'm asking - where do your three forms of strategic autonomy fit in - in this classification that he has provided? And Niklas I'll also give you another one from Aline Bartenstein - on the narrative of strategic autonomy - because I think they're somehow related. So she points at this growing debate and narrative - of the Europe that protects, - and she asks whether the EU narrative changed - from a peace project to a security project - and what does this mean for European values? And finally for Tobias I have indeed a question of my own - so maybe I am not breaking with tradition after all. So you said that the emphasis in open strategic autonomy is on the open part.
So my question is - how do you marry then the EU's strategy of multilateralism and engagement - with a trade policy focussed very much on resilience and autonomy at home? So what are some concrete examples - that showcase how exactly the EU can manage this balance? So first François then Nicole then Niklas then Tobias, - and then we'll take it for another round. And audience, please, keep them coming. And please also state your affiliation, - we'd also like to know who we are addressing.
Thank you and the floor is yours François. Thank you Tania. On the EDF budget, no there's no co-tab for PESCO projects as such.
Of course we are very much attentive to the fact - that the EDF priorities in defining projects - should be in line as much as can be with the capabilities needs - as identified under all the exercises - that derive from the threat analysis, - all the exercises that are actually conducted on the EEA side of things. So we try as much as possible and by design to take into account - the priorities as defined by the CEP, in the PESCOs, but there's no sharing of money for PESCO projects. That said, PESCO projects benefit from a bonus - as per the EDF rules. So we see a kind of positive factor - that is taken into account. But there is no earmarking of budget for PESCO projects. But when it comes to the priorities - which we are defining for the work programme of the EDF, - and as many of you listeners probably know, - we actively engage in that finalisation discussion - of the first annual work programme of the EDF for this year.
We're trying to draw on the expertise - of as many relevant protagonists as can be - so of course we're relying primarily on the member states. The identification of priorities and capability needs - is very much driven by the assessments made by the member states. So this is pretty much member state driven. But also we're relying on the expertise of EES, of the EDA, - and we have our own expertise in-house.
So we are really blending all sources of information - to identify what is the best possible structure for the work programme - to be a balance - and meeting the priorities of the member states - in terms of the type of capacity that they are need of. So that's what I can say on this at this stage. [Lațici:] Thank you very much. Then Niklas. [Helwig:] Thank you.
Indeed you gave me one of the most difficult questions here. But I guess that's what I deserve when I enter all these conceptual debates - I also have to answer those conceptual questions. So what are we talking about - when we talk about all these different definitions of strategic autonomy? Isn't that actually a problem? Well I completely agree there is not one definition of strategic autonomy. There's a traditional one, - there's this global comprehensive view, - and at times this can be a problem. We remember last year for example the discussion, - or at least through op-eds, - between Kramp-Karrenbauer, the German Defence Minister, and Macron - about whether the EU should be strategically autonomous. Macron had his famous interview - where he talked about this very comprehensive idea - of strategic autonomy - within the technological competition - and all the different problems we see in global politics.
And at the same time we had the op-Ed by Annegret Kramp-Karrenbauer - which was very focussed on a very specific element of strategic autonomy - namely the military dimension, - and called strategic autonomy an illusion. So instead of talking to each other - about this vision and these problems of the EU - they were talking past each other. And that's not always that helpful. I still believe it makes sense to use those concepts - because they lead us to these difficult questions we want to tackle. They are first of all a reflection - of how the EU reacts to these international changes.
It is happening. And the EU is producing policies in line with it. So it's our duty or our work - to think about what these changes mean. And they affect real policy choices.
So to look at these concepts is I think valuable - and helped us for example in structuring this report. And it's maybe not always that fair - towards the concept of strategic autonomy - to say well there are so many definitions. When we look at international relations studies - and think about the discussion of power, - what does power mean, - I mean there are books and research seminars - filled with different definitions of power, - different dimensions of power, soft power, hard power, smart power.
And I am not saying this is bad - but they help us in analysing different dimensions of international politics - and that is also where maybe in a constructive way - this autonomy debate can lead us. And our three dimensions, - you added this question Tania, how they fit in, - well this is more related to how we reach strategic autonomy - and different strategies, approaches, towards reaching strategic autonomy - and not so much about the concept itself. The second one Aline Bartenstein, yes an old friend from Cologne. Are we talking about securitisation of foreign policy - or is it now a security project, that was the question. And I think indeed... I don't know if I would use security project as terminology - but what we've seen quite clearly in the last 10, last five years, - is this turn towards a more geo-political EU, - this turn towards principled pragmatism.
We saw this in the EU global strategy - and it is this turn away - from a purely normative value-based foreign policy. I think this is quite a big shift that we are seeing. And in the report we described this as well - in the diplomacy chapter in a way, - that it's often said that it's about promoting values - when we talk about strategic autonomy. I think that's also what Charles Michel used in his speech yesterday, - the EU wants to promote its values on the global stage - and we need to shape the world according to our values.
Well, it's in a way true - but it's less about thinking about converting others, - like China and Russia to a value model that we identify with - when it comes to democracy standards, - when it comes to human rights for example. But it's rather shaping the international context - in a way that we protect our own values. That we institute standards in the technological realm - that protect our data privacy to a certain extent. So in that case one has to be quite...
The EU is actually quite pragmatic, - it's not about protecting Chinese citizens - from privacy abuses. No, it's about shaping the international context in a way - that in the future EU citizens have control over their data - and their data privacy. So it is a very protectionist agenda. And less normative as it was in the future. Also when we talk about resilience agenda in the EU's neighbourhood - it's similar to that.
When we do vaccine politics in the Southern neighbourhood - well is it so much... Well it has humanitarian aspects - but it's also about protecting ourselves from another outbreak of the pandemic - and for a future mutation of the virus. So there is I would say a strong protective turn - in EU politics in recent years. [Lațici:] Thank you very much Niklas. If I could have a small parenthesis - because at the EPRS we look at the EU as a peace actor - and what sort of actions it does to promote peace.
So this is more to Aline's question - and I think it's important to keep in mind - that if you keep in mind the dimension of peace, - it does translate across the EU's policies. And my reading is that by becoming a stronger security and defence actor, - this will give the EU the ability to better and more effectively - promote peace through these policies. But this was just a very small parenthesis - before passing over to Nicole - and I hope you two can forgive the Niklas versus Nicole confusion. Nicole the floor is yours. [Koenig:] Thank you very much, no problem at all.
Thank you for your questions, which are challenging and interesting. With the question of technological autonomy, - luckily we have a chapter in the report on that, - it's not my speciality. But what I would say... So there was a question about external and internal dimension - and how that links to the whole Atlanticist-Europeanist debate.
When it comes to defence industrial products, - this divide plays an important role as well. There's this question of - to what extent do we buy American products - or to what extend to we build European competitors - and that's one of the questions with the future combat air system, - the FCAS that is being developed by France, Germany and Spain. Which of course will be a competitor with the American counterpart. And I think this still remains an open question. To what extent do we buy American products, - to what extent do you join European endeavours.
And again this question also played a role - when it came to third country participation - in the European Defence Fund or in PESCO - to what extent are you open to American or British participation, - or to what extent is that a purely European endeavour - to really foster European industrial technological autonomy. So I think this tension is there, it definitely plays a role. And there's also an internal dimension to that.
So to what extent Europe can become technologically autonomous - depends also on to what extent member states are willing to give up - some of their own autonomy. And I think this is what we have been seeing - in the whole Franco-German debate on FCAS. When you build such a joint project together - do you have to share your own technological expertise? To what extent do you make yourself dependent on other member states - when it comes to exporting for example this product in the end. So also here you have a tension. An internal tension aside from the bigger industrial policy aspects - that also François Arbault alluded to - and which are not my expertise so maybe he can come in on that again. On the nuclear deterrents question, - why that is not so much part of the discussion, I think you're right.
I think it's a bit of a red line. And it's a bit off limits. And I think that's what we could see in this debate - between the German Defence Minister and Macron, - that she clearly said nuclear deterrents are too expensive - and it would be an illusion for Europe to move strategic autonomy towards that. And clearly we still rely on the Americans. And I think here the French vision is a bit different as well. The spotlight is on France as the only nuclear power - after Brexit in the EU.
And we had this idea of a nuclear dialogue, as you will remember, - Germany's answer to that was not highly enthusiastic. And I think this is because on the one hand - it's about sharing sovereignty on the French side, - it's also about sharing quite a lot of money potentially. And it's about crossing an important red line - in terms of strategic cultures for countries like Germany - where we have a debate - on whether we should get the country out of NATO's nuclear sharing. And that's only Germany.
If you then think about other European countries that are non-aligned - and perhaps leaning even more towards the pacifist side - it will be even more difficult. And I ask this question whether this nuclear deterrents question - is being discussed as part of the strategic compass very early on, - and I think the answer was also - no this is too difficult, this is off limits, - we're not even starting that discussion. [Lațici:] Thank you Nicole. And finally Tobias. [Gehrke:] Yes thank you. To follow up what Nicole said on the internal-external divide - is I think critical and technological question.
I think we must not get carried away with the kind of power we have - by unilateral setting standards in technology. We all tap ourselves on the back, - we have done the GDPR - and how great it is for privacy protections - and that everyone is copying it around the world. Be that as it may - this is not a universal case - and we should be careful that we not charge ahead too much.
Now we're speaking about AI regulations and so on. We have to find a simultaneous balance I think with engaging others. And I'm not only speaking about Americans here but others at the same time - to find an external trade and economic strategy - that can build these things together.
Of course at the WTO there are all of these ambitions. But clearly we have to have other outlets - where we discuss these things together. Europe, as Niklas said, we have an ambition - to do, to set, to regulate, to implement.
But I think there's a risk of getting carried away. And we have to get a new kind of foreign economic policy deal. Essentially I think - that's what the new economic trade strategy didn't really get, - is how we use foreign trade as a platform for this. Because the way we do it now, - I think the main instruments being free trade agreements, - they're simply not capable of this.
They are too narrow. And there's a reason for this. The trade people will say - "well we tried more broad with the TTIP with the Americans," - which was more than trade. It was all these regulatory issues and it didn't work. No one wanted it, it was too broad. So let's keep trade for trade - and other aspects we have to see.
But I think that's the wrong approach - because back then we didn't have all these intersecting issues. We didn't have this security aspect, we didn't have the green deal yet. We didn't have ambitions of digital transforming the whole continent.
So it's a new kind of game. And we need a different narrative, I think, - of how we engage globally. One that is different from market integration and only liberalisation. We shouldn't throw them overboard - but we have to have a different narrative. I think the 2018 connectivity strategy, - that was sort of hatched here in Brussels by a few people - and no one actually cared too much about it, - is actually a brilliant idea because it is a new kind of platform.
It's a new kind of way of thinking about Europe and the global economy - and what it's effort can be. Because it integrates not only trade and investment infrastructure - but it tries to speak to values. Holding values together. And that doesn't mean we first aggregate everything in Europe - and then say here you go, everyone adapt the same policies, - but really developing a platform where you can discuss all these issues. A real platform where you can externalise - the massive developments of the green deal that will come. That will be so fundamental I think - that if we
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