European Politics in 2018 and Outlook in 2019

 

 

Current Issues and Policies No. 2018-19

December 13, 2018

Dr. Cho Hong Sik

Associate Professor, Soongsil University

chs@ssu.ac.kr

 

 

Summary

Europe after Brexit underwent a year of confusion and anxiety due to the rise of nationalist extremism in 2018. The difficulty of Brexit negotiation and the emergence of an anti-European populist government in Italy will inflict serious headaches for Europe even in 2019. Added to this, the weakening Macron government in France and the Merkel government in Germany undermine the European solidarity and leadership, thus eroding Europe’s capability to address various challenges of the international community.

 

The Age of Anxiety: Rise of far-right nationalism and fall of the moderates

             If the year 2016 is when Europe was forcefully struck by unprecedented Brexit, Europe restored stability in the following year with the emergence of a moderate young president named Emmanuel Macron in France. In 2018, however, Europe seems to fall back into a precarious state as parties representing far-right nationalism and populism came into power in Italy.

Although the EU consists of 28 member states, the key European states are the so-called big four – Germany, France, Italy, and the UK. The reverberations of Brexit, which began in 2016, still echo to this day, and The Economist described, “this is the most serious domestic crisis Britain has faced in the modern democratic era.” The UK government negotiated Brexit with the EU throughout 2018, and reached a final settlement in November. This deal must be ratified by both the UK and EU parliaments. On December 11, the British Parliament was scheduled to vote to ratify the Brexit settlement, but Prime Minister Theresa May delayed the vote due to a high probability of rejection.

Emmanuel Macron’s administration of France took office in May/June 2017, offering a sense of relief to the world beyond Europe. Just as Donald Trump was elected in the United States, the whole world looked across the Atlantic with trepidation – fearing that far-right extremist Marine Le Pen could enter the Elysee Palace. President Macron was expected to provide a fresh stimulus for integration while ensuring stability in Europe. However, it took only a year and a half for the young French leader’s to have his approval rating fall to some 20%. Especially in November and December, the so-called "gilets jaune (yellow vest)" movement, urging President Macron to resign, has created a revolutionary situation that paralyzed the French state. The Macron government’s attempt to impose pro-environmental fuel tax has met with a fierce backlash among the middle-class and poor people all across France. Accordingly, President Macron has no energy to spare for European leadership as he has to wrestle with the social unrest at home.

             In Italy, for the first time among the European Big Four, the far-right nationalist Lega party and M5S, the epitome of the populist movement in Italy, formed a coalition. This owes to the fact that the coalition of the right or left failed to take the majority in the general election held in March. The parties that pledged to change the establishment politics from its roots came to power; they won support by tapping into anti-European sentiments and policies. The Italian government is currently hassling with the EU over its 2019 budget. EU members coordinate fiscal policies as they use a single currency, Euro, and the new Italian government tries to push the budget to increase spending and the deficit. The European Commission has rejected the Italian budget proposal and has a legal authority to impose large fines if the Italian government continues to insist. The budget issue, though not at such stage yet, could lead to a serious Eurozone crisis in the future.

In Germany, which wields the largest political and economic influence in Europe, the extreme right-wing ‘Alternative for Germany (AfD, Alternative für Deutschland)’ sat in the Bundestag for the first time in 2017 and, by the end of 2018, Chancellor Angela Merkel took her first step toward retirement from politics by resigning from chairperson of Christian Democratic Union (CDU). Merkel who embraced millions of refugees in 2015 as the conscience of Europe, is paying the price in domestic politics. In 2018, both the CDU and the SPD were defeated in major local elections, and the far right AfD has now developed into the third largest political force in Germany. Merkel, having stayed in power for 13 years, will still function as a stable anchor in Europe, serving as the German chancellor until 2021; but it is clear that her political power is severely weakened than before.

Likewise, traditional (Germany’s CDU and SPD) or emerging moderate powers (France’s Republic En Marche) continue to lose popularity throughout Europe, while extreme right or leftist forces tend to garner more public support. The European Commission, which forms the core of Europe, can still be viewed as moderate, but as major member states are bogged down in chaos in domestic politics, the European Commission and EU Council are not in a situation to exert leadership fully. Europe stands at a critical juncture, needing to respond to the Trump administration’s challenges that alter the existing international order regarding trade protectionism or the NATO. But Europe is lacking in creating a cohesive response to a series of challenges.

Concerning the international trade order, the U.S. renegotiated NAFTA with Canada and Mexico (rebranded as USMCA) and has jockeyed with China for power through a trade war. Fortunately, Trump did not expand the battlefront to the European Union. Although it is not easy to analyze due to the mercurial nature of the Trump administration, a new deal with the EU does not seem to be a priority for Trump. While President Trump expressed discontent on the export of German cars and French wines to the United States via Twitter, he did not declare full-scale trade war with Europe. Rather, he seems to change his attitude from welcoming Brexit in the past to conveying the message that the British should remain in the EU. The confrontation between Europe and the United States seems to be more concerning in international politics and military than in trade. Details will be discussed later.

South Korea and Europe on Different Wavelengths

In 2018, there was not a dramatic change nor landmark event to the relation between Korea and Europe. Amid maintaining the conventional relations, the progress of inter-Korean relations on the Korean Peninsula was a new factor. The South Korean government's position was to serve as a mediator in the hostile relations between North Korea and the United States, while at the same time, it aimed at winning European support on detente, normalization of diplomatic relations and finally denuclearization of the Korean peninsula. President Moon’s visit to Europe and his participation in the ASEM meeting this October were the venues of such diplomacy.

Europe has clearly expressed its support for a series of changes, including alleviation of tension on the Korean peninsula, the resumption of inter-Korean dialogue, as well as the summit talks between the United States and North Korea. This is because the hostile confrontation between the United States and North Korea in 2017 was a matter of concern not just to Korea but to the international community, of which Europe is a part. However, it is difficult to say that the EU’s position, especially the permanent members of the UN Security Council France is aligned with the South Korean government. In fact, it is more accurate to see that Korea and Europe were on different wavelengths, making separate voices at the international stage.

For the reason that Europe is relatively independent of the conflict on the Korean peninsula, the South Korean government anticipated the EU to support Seoul’s North Korea policy and contribute to encouraging North Korea to return to the international community. Europe, however, had no incentive to support a somewhat expeditious policy of the South Korean government. Common interests or at least exchange of interest is essential to take a joint step in diplomacy. South Korea was reluctant to openly criticize the United States for withdrawing from the Iran nuclear deal or sanction Russia for invading Ukraine and disrupting international order, all of which Europe considers as the core of international order. For South Korea, it would be shooting oneself in the foot to upset superpowers that are part of or exerting tremendous influence on the Korean peninsula.

Political relation between Korea and Europe seems to be amicable and cooperative in making the same voice, but the limitations to the development of bilateral relations seem clear. It is not easy for Europe to understand the abstinence of South Korea on the human rights situation in North Korea as Europe has a tradition that emphasizes human rights diplomacy. It is rational for Europe to maintain dialogue and cooperation on one side, while expressing criticisms unrestrainedly.

 

Outlook in 2019: Member States’ Politics

The major European powers, including Germany, France, Italy, and Britain do not have elections scheduled this year that will replace the incumbent government. However, as these countries are treading on eggshells of domestic politics, it is hard to predict. First, the coalition in the UK could break up over the divorce bill. The Labour Party opposes the Brexit agreement so as to have another general election. The general elections may bring new cabinet in power but the key pending issues do not vanish. Regardless of the cabinet, the choices will be limited to a ‘no-deal Brexit’ or ‘a second referendum.’ The former will be catastrophic for both the EU and the UK. On the contrary, the second referendum could heavily influence the future of EU. If the Britons decide to revoke Brexit, it may restore stability; but another referendum in favor of ‘Brexit’ will only leave the option of ‘hard Brexit.’

The next time-ticking bomb of 2019 in line is the coalition of far-right populism in Italy. Particularly, the confrontation between EU and Italy over the budget that began in 2018 will possibly amplify in the future. It is fortunate if the government in Rome takes a step back because of the pressure from Brussels and the high interest rates of Italian government bonds in the market akin to the previous case of the Berlusconi cabinet. Nevertheless, should the Italian ruling coalition continues its standoff against the EU, not only the EU but the global market will face a grave crisis. Albeit a low possibility, if the Italian government pronounces that it will leave the Eurozone, the collapse of the Eurozone will enlarge to be a factor of instability that may trigger global economic recession. The worst case scenario will be the collapse of EU integration with the combination of Brexit and Italy’s departure from Eurozone.

The recent ‘gilets jaune’ movement in France, once regarded as relatively stable, reminded that France, the center of Europe, could also be a weak link. No one expected a fuel tax increase for environmental protection to instigate nationwide demonstrations and public resentment. Currently, the French media perceives the current situation as revolution-like and the demonstrators are demanding the resignation of President Macron. The demonstrations may attenuate as its drive wanes; but should the situation aggravate, France may attempt the turn around politics by dissolving the national assembly and holding fresh general elections akin to the 1968 revolution. Anyhow, President Macron will have less time to manifest his leadership in Brussels as he faces formidable challenges in domestic politics.

Another worrisome fact is that German Chancellor Merkel will not be able to wield her influence like the past as she retired from the party chairperson. It already seems that the lame-duck phenomenon hit Germany. Because the SPD evaluates that the coalition with CDU has continually drained its popularity, the SPD could suspend the coalition, sparking a political crisis. In other words, Germany cannot ensure political stability for the EU as the CDU-SPD coalition may not last until 2021.

 

Outlook in 2019: Politics in EU

For the EU as a whole, the year 2019 is the year of general elections, one in every five years. The European Parliament elections scheduled this May is the European general elections. Currently, the European People’s Party (EPP), comprised of Christian democratic political groups, hold the most seats in the parliament. In the current state, the Christian democrats are likely contenders to take the most seats in the upcoming elections, but it is cautious to jump into conclusions with unpredictable political changes. The Jean-Claude Juncker commission will draw to a close and a new European Commission will be formed. In accordance with the tradition confirmed in the history of European integration, the EC leadership will likely to have Christian democracy, social democracy, and liberalism as basic tenets.

The crucial part in many experts’ predictions is the rise of far-right groups and the formation of a large political group within the EP. Because the far-right movements have emerged in each EU member state, the coalition of these groups is likely to have synergic effects. Germany’s AfD, France’s Rassemblement national, and Italy’s Lega already grew sizeable enough to pose threats to existing Christian democrats, social democrats, and moderates. Even though these parties may be unable to constitute a majority to control the EP, it will have enough seats to pressure the EP to take far-right nationalist and populist agendas seriously.

Actually, the rise of far-right nationalism in Europe cannot be explicable with solely Europe’s inclination to the right. As the cases of Syriza in Greece, Podemos in Spain, and La France Insoumise in France suggest, the far-left political groups also have made their presence felt in conventional politics. Eventually, the pivotal course of events is the fact that the moderate political groups are in decline and the extremists, irrespective of left-right divide, have filled in the void. Depending on the situation and history of each country, the movements take either far-right or far-left ideologies. Moreover, the regionalism - although it has traits of resistance against nationalism - could be explained in the frame of ‘identity politics.’ The recent Scottish independence movements and the movements in Catalunya hint at the possibility of a strong regionalism in a limited area.

As diverse disputes occur in the EU, the East-West divide has been elevated to a new level - more serious. If the UK leaves the EU, the countries in the European continent is separated between the Eurozone West and the remaining East. The Central and Eastern European countries such as Hungary, Czech Republic, and Poland have strong nationalist tendencies and have framed a confrontational structure, criticizing the Western democracy and carrying out authoritarian moves. The EU’s criticism of the Polish government and the following confrontation in 2018 allude to such disputes. It has a different sense of centrifugality from UK or Italy. Amid these circumstances, it is fortunate that the economies in Southern Europe such as Greece, Portugal, and Spain have shown signs of recovery.

Outwardly, the relation between EU and the U.S. is a key link to note in 2019. President Trump lambasted Europe but the EU-U.S. relations did not aggravate to explicit confrontation and standoff as with U.S.-China relations However, the strong reaction when President Macron mentioned the ‘birth of a European army’ may be a harbinger for deep fissures and confrontation between Europe and the U.S. In such case, the concept of an Atlantic community or the West that persisted for more than seven decades since the end of the Second World War may disintegrate. This is why South Korea should observe warily and evaluate the EU-U.S. turf war over NATO management and defense-sharing costs. The security-related EU-U.S. relations is a mirror that reflects the U.S.-East Asia relations. 

 

 

 

This article is based on the author’s personal opinion and does not reflect the views of the Sejong Institute.

 

*Translator’s note: This is an unofficial translation of the original paper which was written in Korean. All references should be made to the original paper.