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Publishing industrial strategies has become something of a cottage industry for Brussels. In the past 15 years the European Commission has produced at least five of them — with the most recent landing in September 2017 when Jean-Claude Juncker was in charge. Next week the commission will put forward its latest effort, following protracted internal wrangling among senior commissioners. The idea behind the strategy is to bolster Europe’s green and digital ambitions, boost the competitiveness of the continent’s industrial base while smashing barriers within the single market. If the overall goals sound familiar, that is because they are. The 2017 strategy, for example, was meant to help make the EU “the world leader in innovation, digitisation and decarbonisation”. Previous strategies going back to 2005 aimed variously to foster an “industrial renaissance”, create a “stronger European industry for growth”, bolster manufacturing productivity and enhance conditions for enterprise development and innovation. The past papers are full of some of Brussels’ most cherished buzzwords — abounding with “integrated” efforts to save Europe’s industrial base and pledges to stimulate investment. Does this latest strategy bring anything new? Well, the context certainly is. The so-called geopolitical commission run by Ursula von der Leyen is determined to take a more aggressive approach to fostering EU interests, making the continent more self-reliant and fending off perceived unfair competition from abroad. As the commission president said on Thursday, the EU is an open economy but this should not be “taken for granted” given its open-handed approach is not reciprocated elsewhere. This means pushing forward procurement rules that aim to crack open foreign markets that are closed to EU businesses — among them China. It also has prompted a deep examination by the commission of how to tackle foreign state-supported enterprises that are gaining an unfair competitive advantage in the EU. The question, of course, is how dirigiste the EU should be in its attempts to bolster homegrown industries of the future. This week the EPP Group, the centre-right coalition in the European Parliament, said Brussels needs to be ready in exceptional cases to allow mergers that would create pan-European champions similar to the one that would have been formed had Margrethe Vestager, commission executive vice-president, not blocked the Siemens-Alstom tie-up last year. For his part, Thierry Breton (pictured below), the single market commissioner, told Le Figaro this week that EU policy cannot have the sole aim of reducing consumer prices — it also needs to enable the emergence of industrial world leaders. But the commission is not of one mind. Ms Vestager, who oversees the EU’s competition regime, stresses that the goal of building up globally successful businesses should not come at the expense of consumer interests. All this will continue to be the subject of intense debate within the commission long after the publication of next week’s paper, which will reference commission reviews of competition and state-aid rules but not jump to conclusions. The strategy and its associated reports will instead examine barriers that have emerged within the single market and how to address them, offering solutions such as a one-stop-shop for smaller companies wanting to set up in another EU member state, according to officials briefed on the contents. The report will also kick-off work on defining industrial “ecosystems” that the EU thinks need to be nurtured and supported — a cause championed by Mr Breton. Strategy papers are good at papering over disagreements. That is why Brussels is so fond of them. The challenge for Ms von der Leyen is to come up with an approach that national governments and the European Parliament can rally behind, and take tangible measures to further the bloc’s economic interests. Graphic du jour This week’s lone emergency rate cut by the US Federal Reserve was in stark contrast to past global economic crises, when the central bank acted alongside its peers. But the space for traditional monetary policy to be used to tackle the economic effects of the coronavirus outbreak is in reality decidedly limited across major economies. (chart via FT) Planet Europe War of independence The first round of EU-UK negotiations concluded on Thursday in the only way they possibly could, writes Jim Brunsden. Brussels and Britain came out of four days of talks convinced that the other side was being very unreasonable. Michel Barnier, the EU’s chief negotiator, made clear to reporters that Britain is not going to be getting any trade deal if it does not grant EU fishermen stable access to its waters. The former French fisheries minister said the union would never sell out the interests of the men and women who do that “dangerous job”, insisting they “deserved” a sense of security about their future fishing rights. The UK’s insistence on leaving fishing rights up to annual negotiations was “absolutely impractical,” Mr Barnier said. The UK’s complaints are just as extensive. British officials argue that the EU’s vision of the future relationship would fundamentally violate Britain’s sovereignty, not least when it comes to demands for alignment with union state-aid rules. “The UK team made clear that, on 1 January 2021, we would regain our legal and economic independence — and that the future relationship must reflect that fact,” said a government spokesperson. Some sparring is standard fare for an international negotiation: both sides set out competing positions and, one hopes, haggle their way eventually to a compromise. But nothing about this negotiation is normal. Thursday’s press conference by Mr Barnier laid bare the philosophical disagreement at the heart of the talks. Britain sees its negotiating position as an exercise in asserting its independence as a trading nation. On the other hand, for the EU’s negotiator: “nobody, nobody is contesting UK independence, and we ask the UK to respect our own independence.” “The real question here is what we do with our reciprocal independence,” said Mr Barnier. “Our common challenge is now, as two independent entities, to agree together on ground rules that make it possible for us to co-operate.” That difference of perspective has consequences. One of the most revealing things about the first round was that the two sides do not even agree on the basic project they are working on: Britain wants a number of separate agreements covering different forms of co-operation; the EU wants a single framework with one system of governance and dispute settlement. Given that barely nine months remain before the end of the UK’s post-Brexit transition period, this would be the kind of thing it would be good to have figured out by now. Migration showdown EU foreign ministers meet in Croatia on Friday to complete the final set of emergency meetings to discuss the Greece-Turkey migrant flare-up this week, writes Mehreen Khan in Zagreb. The gathering comes hot on the heels of a six-hour meeting between Turkey’s Recep Tayyip Erdogan and Russia’s Vladimir Putin, where the Kremlin chief said he was willing to agree a temporary ceasefire in the war-torn Syrian region of Idlib. (New York Times) The accord will be welcomed by EU leaders who are on high alert over an escalating civil war that will further displace Syrians who could eventually end up at Europe’s borders. Josep Borrell, Brussels top diplomat, on Thursday warned the EU was “at the beginning of a migration crisis”. As for Friday, foreign ministers will probably sign off on a joint statement that has been the source of diplomatic wrangling between Greece and Germany for the last week. Athens has pushed for the toughest possible condemnation of Mr Erdogan for encouraging Syrians to go to Europe and what it sees as Turkey’s malign role in Syria. Berlin has urged caution, recognising that Mr Erdogans co-operation is crucial in staving off another wave of migrants to Europe. A draft version of the EU statement, seen by the FT, repeats “strong rejection” of Turkey’s actions. Ministers will now have to decide on how to call on Mr Erdogan to keep respecting the terms of a 2016 EU-Turkey agreement, including whether or not they are willing to give Ankara more financial support under the deal. Meanwhile the FT reports on Friday morning on why Europe and almost all its mainstream leaders and the commission have hardened their stance on migration so markedly. Cancelled cavalcade The European Parliament has abandoned plans to travel to Strasbourg next week for its plenary session, saying the spread of coronavirus presents too great a risk. In an internal email to staff, president David Sassoli said that the assembly would stay in Brussels, on the grounds that the journey would involve “significantly higher health risks for Members and staff as well as the local population”. Green takeover The rise in popularity of the green movement in Europe is real. In France, the Green Party came third in last year’s elections for the European Parliament. It is threatening to take some big cities in this month’s local elections — including Tours and Besançon. The latest to emerge as a potential win for the Greens is Strasbourg, where Europe Écologie-Les Verts could morph from a campaigning movement into a genuine political force. (FT)
