Policy Paper §7: Circular Solutions to Telecoupled Externalities of EU’s Green Economy Transition

Policy Paper §7: Circular Solutions to Telecoupled Externalities of EU’s Green Economy Transition

licence

Teodor Kalpakchiev

2-07

Globalization has triggered an enormous momentum in coordinating global value chains. However, as microeconomic optimization does not necessarily internalize ecological or anthropocentric concerns, subjecting trade to a range of instruments such as voluntary certifications, international agreements, collaborative and participatory mechanisms, tariff and non-tariff barriers is meant to adjust the negative environmental effects of EU’s domestic greening of the economy.

 

Untitled
Visualization of Telecoupling (Liu et al., 2014)

Long-distance relationships designated as telecoupling are oftentimes caused by the drive for sustainability leadership in the EU, which counts on redistribution of wealth towards renewable energy, renewing resource flows, optimizing resource use, etc. However, as land on the continent is relatively scarce and there is competition for its use (e.g. urbanization, food, biofuels, photovoltaic plants), which forces is to count on imports of biofuels from Eastern Europe or further, of renewable energy from North Africa, but also leads to excesses in (oftentimes processed) food that is shipped towards the rest of the world, while wholemeal grains, fruits and vegetables with little to no added value for the produced (had it not been for the fairtrade certification schemes) are imported.  Agents working within these relationships are government officials, shipment and logistics companies, workers unions as well as companies acquiring land both within the EU and abroad.

Effects that manifest telecoupling of anthropocentric governance and the ecological balance are, for example, EU’s rising environments for the increase of biofuels within the transport mix, heavy planting of palm oil, maize, sugarcane that damage traditional subsistence and the structure of the economy. Oftentimes the plantations are used as cash crops that induce energy in bioplants, while having additional exhaustive effects on the soil and are polluting rivers and the rest of the environment with pesticides. In target countries, telecoupling also results in blurring the rural-urban divide, as increased travels between those in order to sell/buy necessary resources produce new emissions (oftentimes from old vehicles).

Trade of Land
Land Trading Networks (Seaquist et al, 2014)

The question is whether and which instruments the EU could use to induce a more nuanced trading regime that makes use of the non-reciprocal relationship towards countries in need of economic growth, but with stagnant governance reforms. Interestingly, post-sovereign formations elsewhere oftentimes forego the ability to adjust such responses to global demand, as with a non-completed single market, reduced regulatory capacity and oftentimes insufficient transfer of sovereignty they do not manage to induce action in state actors. Hereby come handy namely the horizontal and vertical anthropocentric coordination efforts, as they aim to improve the understanding of local externalities of the EU’s external trade regime. These feedback loops are meant to derive the causal relationships that exist and potentially address them.

From the perspective of distant flows of goods that induce carbon emissions from transportation, as well as the intensified land use, a circular approach would entail greater use of the principle of bio-regionalism, resp. local sourcing of goods, which in this case would mean preference for goods produced in the vicinity. This can be done via EU Neighbourhood-wide labelling for origin, as well as differentiated tariffs between associated and countries with no particular status. For example, nuts grown in North Africa would receive preference than those grown in South America. When we speak of waste shipments, resp. end-of-live vehicles or computers that are oftentimes intended for repairs in Africa, but end on dumpsites, there should be sufficient waste processing facilities, whose secondary market resources should have preferential buyout prices on the EU market. The same would apply to biofuels, which are normally shipped from sugarcane grown in Brazil or Palm Oil grown in South-East Asia. These can easily be substituted with reprocessed oil for cooking that’s collected from industrial production sites and franchise chains. As for biofuels produced, e.g. in everything but arms countries or simply trade partners, these should be preferably redirected to the closest possible country where demand exists. In order to avoid damage to soils and land, DG Trade could assign a label or tariff reduction for crops rotation and bio-production.

Additionally, from a governance perspective one should deem the expansion of carbon-wide emissions and forestry clean development mechanisms (EU ETS, FLEGT) by incorporating the EU neighbourhood. To achieve faster replication of circular solutions, a city-to-city network between EU’s Eurozone core, its eastern European periphery and the neighbourhood should be established, whereby each of the three cities should be a rotating coordinator of green transition initiatives. While this would ensure learning on the micro scale, the Committee of Regions could ensure mutual learning through horizontal sector-focused collaborative epistemic networks. The normative approach of communicating EU’s external policy should therefore include messages such as that the EU supports the regional economic integration of distant economies through green transition initiatives, thus embedding a values-driven policy mechanism into its trade-for-aid aspirations.

In short:

  • Embedding bioregionalism through labelling, certification and tariff schemes
  • Tri-city policy partnership with rotating presidency
  • Incorporate neighbourhood countries into clean development mechanisms
  • Ensure sufficient waste treatment capacities in partners and facilitate secondary material imports
  • Use visualization and communication tools to ensure wider awareness of spill-over systems as triggers and regulators of telecoupling

Policy Paper §6: Matching EU‘s Circular Economy Missions with Circular City Networks

Policy Paper §6: Matching EU‘s Circular Economy Missions with Circular City Networks

licence

Teodor Kalpakchiev

2-07

The global neoliberal take (resources) – make (products) – dispose (waste) paradigm has brought unprecedented levels of overconsumption and damage to the ecological stability of the earth that includes negative repercussions on the overall liveability of the planet. Waste enters our bodies through marine litter or the usage of plastics in drinking water, through contaminated soil into our food, as well as through the air we breathe in, as we oftentimes have to incinerate it to create energy.

The European Union has projected itself as a multi-faceted, multi-level, interdisciplinary policy-making machinery that engages in hybrid multilateral actions, one of the most peculiar ones is the Circular Economy Missions that already took place in Chile, China, Colombia, South Africa. In September 2017, a further one will be taking place in New Delhi, India.

Besides adjusting global trade in agricultural goods imported from one place to be used elsewhere for feedstock or upscaling without considering the negative effects on the environment, these missions are aiming to promote and facilitate trade in sustainable goods, foster circular and sustainable enterprises and provide a forum for sharing and upscaling solutions. Thus, albeit academically, the circular economy has been premised within the de-growth paradigm, in reality the missions aim to foster economic growth based on green goods and sustainable energy. Thus, with US and China positioning themselves as the world’s largest producers of electrified cars and storage batteries and possibly engaging in trade wards, the EU is trying to capitalize on the proliferation of its trade regime through a network of sustainable enterprises and initiatives.

From a governance perspective, besides this form of a region-to-country cooperation, one of the best ways to foster further networks would be the expansion of the already existing city networks, which could function as a stepping stone towards practice and expertise sharing, as well as inclusive planning for circularity. What would a circular city entail though?

 

 

Circular Cities

Cities are a juncture of human activity, material exchanges, capital accumulation and produce a number of outputs. Their most essential parts are road and railway infrastructure, housing, small to medium sized service spots, manufacturing and industry.

Information and guidance on existing rules are an integral part of communicating the functioning of a circular city. These can take up the form of conceptual graphics explaining the flows of resources, commodity costs, as well as opportunities for re-usage of resources.

The usage of land in a city is essential to creating a functional, liveable and stimulating environment that improves living conditions, material efficiency and creativity for establishing new ventures. Land could take the form of ecologically sustainable green spaces that serve as an example of urban gardening that improves food security, electrification landmarks, such as photovoltaic installations that store power for mobile phones and electric bikes, large scale depots for end-of-life interior, clothing and other material belongings that are transformed into repair and upscale facilities, where people create furniture, electronic equipment or engage in crafts and arts, etc.

Due to the overt production of plastics with limited use in most world cities and their relative small size, large scale usage of plastics, such as their compression for the creation of flat and durable pavement, which can be used for paving tertiary and rural routes at a limited price, the separation of different land usage or the protection of coastal waters against earthly force majeure induced by climate change.

Excessive food waste could be dumped in sites at critical junctions of the city, where there are plentiful of restaurants and working spaces, and be collected daily to create nutritious compost for the gradual reforestation that lead to the creation of green belts around the city limits, which also serve as natural bio-habitats, as well as open space sports and leisure centres. On the other side of the problematic, the increasing pressures on food insecurity mean that peri-urban and urban farming of food in cities could foster the return to traditional livelihoods, while reducing carbon pressure.

Farming in the developing world could benefit from regenerative agriculture practices, such as crop rotation, usage of the shared economy to foster the wider use of technical capital, such as plough machinery, as well as ICT tools that enable knowledge sharing and facilitate supply chains via mobile phone apps, as well as optimization of the care for agriculture through sensors that sense change in the soil, the weather and guide robotized solutions based on e.g. drones. Naturally, all these should be part of the leasing society, which fosters continuous repairs for the provision of monthly instalments, while the product ownership remains in the hands of the producer.

Idealist Perspective

Circular cities would be a place where you commute to share the results of your research through a carbon-emissions free public transport system, whereby the transportation would consist mainly of circular train networks driven by carbon engines that exhaust drinkable water and electric bike system, charged by decentralized home-based prosumption of renewable energy from photovoltaic systems. Mechanization of transport, logistics and manufacture would result in two tendencies – the necessity for more hardware maintenance positions and the redistribution of welfare through the adoption of an universal basic income (upon the condition that part of it will be reinvested in one’s own readjustment to the labour market).

A modern workplace would not be office based, as urban gardening would make the city a much more creative space, where collaborative networks would engage in solving social and sustainability challenges.  Separate employees would participate in meetings, which define the tasks and then seek alliances through his/her network. Stability would be the norm only for administrative and managerial positions, whereas everybody else would aim at flexibility of the work loci. The advent of MOOCs and distance learning would decompose class structures and would allow the inclusion of economically disadvantaged social strata.

Global expertise would be pooled in sectoral e-platforms that are targeted directly by recruiters, thus making HRs one of the most powerful positions. The push action of finding a job that is already redundant would gradually be substituted with publicly available registers of performance. Capital gains will not be measured solely with financial assets, but also with human and environmental capital. Corporate social responsibility and philanthropy will define the strong market players of the day due to their increased visibility. In comparison with today working hours and unemployment would shrink and larger shares of capital gains will be used for research and development. Continuous health insurance will substitute pensions.

The capitalist consumerist culture will be substituted by malls, where creative laboratories would make the best use of secondary materials. Old toys and electronics would be transformed into household appliances and furniture would be used to recreate social spaces. Heating of malls and public spaces such as railway stations would be warmed by people’s naturally emitted heat. Additionally to food vouchers, people would receive greening vouchers that can be used to improve one’s sustainability lifestyle through buying biofood, biofuels, planting trees or donating to specific causes.

Top-Down Governance

While the missions could serve as tools to identify existing production capacities and potential needs for sustainable goods, the city networks could further enhance these by regionalizing the approach and making it easier for certain areas to specialize, while taking note of the existing knowledge base and human capital. One of the vital questions remaining, however, would be how to make sure that the untapped resources of the developing world are equitably shared or exchanged for technology.

Policy Paper §5: Sofia’s Council of EU and China 16+1 Summit Presidencies – Pathway to a Resilient Neighbourhood?

Sofia’s Council of EU and China 16+1 Summit presidencies –

pathway to resilient neighbourhood?

3-07

Teodor Kalpakchiev

the-ENPI.org

licence

 

Abstract: The article reviews the legal, historical and policy boundaries of Bulgaria’s current commitments to institutionalized summits in 2018, as well as the conceptual transferability of the idea of resilience in the Neighbourhood that can be achieved through non-sensitive policy initiatives.

eprs-briefing-579065-budget-common-foreign-security-policy-v2-jpg
Source: EPRS

How do foreign policies come to being? 

Eastern Partnership of the EU was evoked during the Czech presidency of the Council of the European Union and further developed by most notably by Sweden and Poland. The executive of their governments thus capitalized on the chance not only to continue and conclude legislative dossiers, which take up to two years from the conceptualization to the promulgation, but also to propose a new direction in EU’s common foreign policy, an agenda-setting prerogative exclusive to the Presidency. The domain has been largely restricted by a number of factors. As many other supranational bodies, its functioning depends on a country’s overall welfare, as only a prosperous country would find utility in paying lavish salary to second its experienced bureaucrats, who could spread their ideas internally. Additionally, EU’s foreign policy, often decided at meetings of one of the ten configurations of the Council of EU and chaired by the HRVP, has been difficult to coordinate, both due to the discrepancy of weighting member-states positions embedded in their overall normative performance, as wells as their divergent preferences, which make reaching anonymity almost impossible. Recently, many have begun also to ponder over EU’s ability to maintain the resilience of the pro-European communities not only its vicinity, but also in its internal periphery, which largely corresponds to the countries not willing to sacrifice their sovereignty of having an own monetary policy. Among these there are member states whose foreign and defence ministries are led by ministers mandated by nationalist or populist parties or staffed with elderly personnel belonging to the old conjuncture might have a desire to simply gain access to documents requiring security clearance. Hence, more often than not foreign policy comes to being as a top-down endeavour of the bureaucratic leadership – be it the HRVP, the College of Commissioners, or the EPSC advisory body to the Commission’s President. Of course, there is also the possibility that that a member of the MEP self-commissions a legislative report that is put on AFET’s agenda and voted on with an absolute majority in the plenum – an act, on which the Commission must follow up according to its own inter-institutional agreement with the EP[1].

Bolgars
Source: Wikipedia

Bulgarian origins, soft power influences and identity.  

Bulgarians, as many other Balkan nations, suffer from an identity disorder. While some focus on the Eurasian trajectory of their ancestry, which leads back to the aboriginal origins that point towards Uzbekistan and western Kazakhstan, the Old Great Bulgaria around the Azov Sea and possibly extending to North Caucasus (due to the presence of the Kabardino-Balkaria north of Georgia), as well as а number of settlements along the Black Sea coast (near Odessa, Constantsa, Odesos, etc.), as well as the Bolgar Tatarstan region in Russia, some genetic scientists emphasize Thracian influence and discard the Slavic thesis, which was used during Soviet times to draw the country closer to itself (incl. through the simplification of Old Bulgarian language, used until 1920s). More recently, Russia’s soft power comes into play also through the channels that have become well known to the Eastern Partnership countries – hybrid diffusion of ideas and alternative discourses through internet, usage of the Russia population’s feigned friendship to get the best private property along the coast, as well as the promoting a more conservative liberal mind-set through the Orthodox church, which also is a sense a juxtaposition of West European multilateralism and liberalism.

In particular, this transliterates into the presence of the Donetsk People’s Republic flag on national holidays, which is then shared in internet, the ownership of more than 500 000 private properties by around 200 000 thousand Russians, as well as the recent interference of the Bulgarian Orthodox Church into the dialogue concerning the Istanbul Convention. It has focused on Art. 3. c), which defines gender in the context of gender-based violence against women as „socially constructed roles, behaviours, activities and attributes that a given society considers appropriate for women and men“[2]. Naturally, within a country at the crossroads of influences from the west, south and east, this claim was contestable.

What made a bigger impression was the nearly omnipotent political discontent with this claim that included most notably the socialists in opposition, whose previous leader (born in Kherson, Crimea and is currently heading the Party of the European Socialists) committed personally to the adoption of the declaration on European level, the United Patriotic Front (which holds the Defence, Economics and Demographics portfolios). Both of these parties have been accused of some form of cooperation with Russian business groups, leadership or intellectuals (such as A. Dugin, who appears on photos with Volen Siderov, head of ATAKA, which is in turn the most Russophile, populist and nationalist element of the patriotic front). With the rapprochement of Russia and Turkey that comes down to the failed South Stream natural gas pipeline project (discarded due to lack of compliance with the Third Energy Package of the EU and abandoned despite the advancement of the Nord Stream II) that has transformed into the TANAP, the divided and side-lined Movement for Rights and Justice (DPS) might have wanted to vote against the convention, but thus it would have blocked the way for coalition with the ruling Christian-democrats. Although the previous DPS leadership (Ahmet Dogan) has been accused of being seconded by the Turkish intelligence in Bulgaria to overcome the friction that followed the „Great Excursion“, resp. the deporting of Muslims unwilling to change their names by the former Communist party, it has found its allies on both sides of the political spectrum (possibly also due to previous ties with the current Prime Minister, who was back then the private security guard of the communist leader Todor Zhivkov and subsequently also the king-in-exile, who became a prime minister), the new leadership might still be unable to position itself. Although accused of pro-Russianism due to his proposal to review the sanctions against Russia, after the prolongation of the sanctions by the Council of EU in December, the current president Radev (a nomination of the Socialists) has toned down his position and slowly emancipated himself. One clear deduction from the aforementioned facts is that virtually all parties (possibly with the exclusion of the Greens) have had something to do with Russian interests or stakeholders and that it is the advent of the country’s Council of EU Presidency that has transformed these into delegitimizing factors. A further factor in the direction is also the lacking drive for an all-encompassing lustration despite reinvigoration of the Vergangenheitsbewältigung (dealing with past) through uncovering the truth about labour camps or socialist cadre policy, beneficiaries of which still run many public entities (esp. in education, research and intelligence).

But how does this distant and recent past transliterate into identities? The question is asked in plural, as by default the country has been said to consist of at least three ethnicities (proto-Bulgarian, Thracian and Slavic) and support for EU membership just slightly above 50%. With a thesis about a central Asian origin supported during socialism and another about a Pamir-Hindu Kush supported by Turkish and English scholars, previous influences from Iran, Ostrogoths, Celts, with some Armenian and Jewish minorities living inside the country, Bulgarian minorities alongside its borders, as well as in Ukraine, Armenia and Russia (Tatarstan, Chuvashia and Kabardino-Balkaria), the picture becomes even more complicated. To this one should add that there is more work force abroad than in the country itself, as well as that demographic projections are dystopian. Bearing the latter in mind, many are sticking to conservative values and protectionism over the last remaining assets that have not been sold to offshore companies that don’t pay taxes (latest assets sold include most malls in the capital, a large bank, the national tobacco company, as well as gold and wood extraction, etc.). Last but not least, the country is boasting many negative labels, such as most corrupt, the one with the least free media, the poorest, etc., which only support encapsulation, distrust towards the unknown and support for a seemingly strong leadership that legitimizes itself with the support of printed press spread to an aged population and owned by the largest magnate – Delyan Peevski, responsible for a bank outburst that ate nearly four billion Euro of taxpayers’ money.

16_1_initiative
Source: ECFR

Geopolitics – a case of small, unreformed member of the Union.

Superimposing geopolitical aspirations over a plethora of domestic concerns seems to the most noted feature of the Bulgarian Council of EU Presidency. It begins with the Western Balkans – a domain with long history that was a feature of the head of the Socialist International Georgi Dimitrov’s and Tito’s aspirations for seclusion from the Soviet Union that resulted in the subsequent plundering of the country (incl. its gold reserves, human capital through resettlements, as well as natural resource endowments) during its time as USSR-satellite. Bulgaria holds also probably the highest number of scholars researching on the region, as well as a large number of former dissident-traders that were active during the Yugoslav embargo. Cultural affinity and susceptibility of socially constructed irregularities could definitely be of use to the wider Union, should Bulgaria manage to conduct the necessary domestic reforms and showcase regional leadership.

But this is not its single geopolitical feature. In November 2017, the Prime Minister and the former king in exile met with their counterparts in Saudi Arabia, thus turning their back on an African Union – European Union Summit in Cote d’Ivoire, possibly thus avoiding the politicization of contentious nature of the migration policy. In the aftermath of its Council of EU Presidency Bulgaria will hold also the next edition of the China – CEE 16+1 Summit, which is by far the best chance to capitalize on the ownership of the trajectory of the One Belt, One Road. Hence, the Bulgarian Presidency must make sure that corruption is eradicated in the domains where the biggest amount of EU funds are distributed namely transport, railway and energy networks, as well as that its trade-off between South Stream and the Commission support for a Balkan Energy hub finds an additional supporter in the face of China. Additionally, its ability to facilitate dialogue learned during the Council Presidency should make sure that Chinese investments do not take the form of loans, but rather a combination of toll taxes, management and technical engineering expertise (as the current performance of reviving the national railways is rather low). Additionally, it should use the competition for control of ports between Russia and China not only to expand the capacity of its own ports, but also to put illicit maritime networks (oftentimes starting from Sevastopol), the clandestine militarization of the Black Sea (Russian and NATO ships often travel without flags), as well as the Blue and the Circular Economy as its preferences, as China holds strong expertise in the latter. Beijing also supports the autonomous regionalisation of the region, which could mean both support for the further institutionalization of the Black Sea Economic Cooperation, as well as of the Polish Intermarium, which remains largely a geopolitical aspiration, rather than a pragmatic instrument (such as PESCO).

Circular Economy
Source: COR

What about resilience in the Neighbourhood?

Notwithstanding China’s soft power and multilateral commitments in the trade-sustainability-economic development nexus on the rise, Bulgaria’s current commitments towards the best performers in the Eastern Partnership remain difficult to identify. As the Union’s poorest country it finds it hard to disburse significant amounts of aid (UN commitments remain at 0.7% of GDP) and focuses these predominantly on the Western Balkans and the Neighbourhood. Education projects and twinning of best practices remain its reserved domain. Bearing in mind the EU’s most recent reprogramming of the EU’s Neighbourhood Policy essentially in the direction of technocratic policy cycles and transferrable resilience, Bulgaria should make best use of both its strengths within the EU institutions, as well as China’s expertise. The Bulgarian European Commissioner Gabriel is currently responsible for the intersection among Digital Economy, Cyber Security and the Energy Union – areas, which are of utmost importance to the resilience of the Eastern Neighbourhood to external influence through resource dependency and alternative discourses. Since 2013 the most pronounced problems in Ukraine in this realm were the dependence on Russian gas, whose abolishment has been conditioned by EU to the liberalisation of the energy market, as well as Russia’s distribution of alternative discourses related to the crisis in Crimea. Bulgaria could, for example, seek the accelerated inclusion of the DCFTA countries into the digital single market, as well as the mediation between Eastern Partnership countries and Russian perceptions on the conflict by inviting them as observers to the 16+1 summit and proposing projects of common interest in non-sensitive areas, such as the Blue, the Shared and the Circular Economy, improving railway, maritime, energy and digital connectivity, ethical questions related to usage of the new global currency – personal data and establish horizontal ties between donors from the AIIB, NDB, DEVCO,  BSTDB to improve aid effectiveness and twinning of best practices. Such an approach can not only be beneficial to the regional ownership of the OBOR, but also result in positive externalities towards issues that are existential to the major actors in the vicinity and beyond – EU, Russia and China. For that purpose, the aforementioned legal and institutional possibilities must be maximised and party confrontation – depoliticized through a focus on shared identities and technocratic policy-making by the advent of the summer.

[1] Eva-Maria Poptcheva, Parliament’s legislative initiative, Library of the European Parliament, 24.10.13, http://www.europarl.europa.eu/RegData/bibliotheque/briefing/2013/130619/LDM_BRI(2013)130619_REV2_EN.pdf

[2] Council of Europe Convention on preventing and combating violence against women and domestic violence, https://www.coe.int/en/web/conventions/full-list/-/conventions/rms/090000168008482e

Policy Paper §4: Supranational hybrid materialism: Two strategies for own resources of the European Union after 2020.

Supranational hybrid materialism:

Two strategies for own resources of the European Union after 2020.

licence

Teodor Kalpakchiev, Head of Research, the-ENPI.org

2-07

Executive Summary

The continuous reduction restrictions to expanding the own resources of common budget of the EU and the trajectory of United Kingdom’s exit has reinstated the need for generation of own resources for the common EU budget. This policy paper puts forward two proposals based on hybrid finances and quasi-monetary markets based on taxing non-renewability, which altogether would create a form of supranational hybrid materialism that will be transformed into capital feeding into the common EU budget.

  1. Establishing a supranational hybrid finance system.
  • Countering large-scale tax evasion through externalization of EU’s competition policy.
  • Transformation of all aid mechanisms to investment-related ones in order to overcome the donor-recipient relationship, which is harming the reciprocity of interregional relationships, which are ultimately the goal of European regional governance.
  • Creation of a supranational oversight mechanism that ensures that capital control is maximized and extrapolation of financial blending based on investing taxpayers’ money into infrastructure assets, while providing guarantees for the multiplication of the venture through private capital.
  • Acquisition of state debt and collaterals from the American equity market through national development banks and the creation of integrated national capital markets in non-Eurozone countries.
  • Taxation of bitcoins and establishment of a technology adjustment fund to create dedicated servers inside Europe, where operations will be both generated and oversighted.
  1. Creating quasi-monetary markets based on taxing non-renewability.
  • Usage of the clean development system to generate own resources for the adaptation towards sustainable production and competitiveness (e.g. through emissions trading, REDD+)
  • Integration of quasi-markets into EU’s own resources through the concept of carbon leakage and the liability of foreign enterprises.
  • Creating a system of green trade, which is based on export promotion of environmental goods and creation of monetary restrictions to goods non-compliant with EU’s internal regulatory regime
  • Taxing waste (incl. its material and carbon externalities) inside the EU and non-circular products entering the EU
  • All taxes on external borders to be channelled to EU’s common budget

For the full research (incl. annexed review of EU ETS and Parliamentary positions):

 

 

 

Policy Paper §3: Economic Consequences of the Western protectionist emancipation

Policy Paper §3: Economic Consequences of the Western protectionist emancipation

Teodor Kalpakchiev

licence

3-07

Since his election Trump has embarked on a more restrictive economic policy, which includes reshuffling domestic policies, re-negotiating trade deals, as well as restricting America’s participation in multilateral organizations, thus reviewing traditional relationships with other countries.

The impending economic disjuncture

Globalization, as per popular conviction and theoretical underpinnings, is a result of the expansionary industrialization of England and USA combined with an attempt to structure value chains via exploiting the natural and human endowments of former colonial territories. Additionally, the block has been a stark proponent of deregulation, which provides a boost to emerging domestic economic operators by allowing them to float freely in the global economy. In order to secure a global market for its companies, the Obama administration embarked on coalescing these by materializing the interregional trans-Atlantic and trans-Pacific deals respectively with EU and East Asia. The strenuous process had a sobering effect on these counterparts, which realized that the globally present American companies would relish excessive advantage in competing with theirs, as well as sizeable extra-judicial protection. Trump’s motives mirrored a number of contrasting concerns, such as China’s GDP growth being continuously three times bigger while retaining parity in purchasing power and leverage in high-tech exports and monetary reserves[1]. The strong dollar and retrieving value chains from the regional NAFTA meant to him an opportunity to foment job places and incentivize growth, thus increasing American citizens’ ability to purchase imported goods and restoring USA’s place as the leading global economy. We may define his pledge to cut regulation by 75%[2], reduce corporate taxes and instigate trade barriers as protectionist neoliberalism, aimed at absorbing the waning fossil fuel prices and stagnant commodity prices’ growth. Thus, in contrast to Russia’s willingness to pave its way towards expansionism to the poles, Trump rather aims to maximize the attraction force of the Singaporean economic freedom and accumulate capital for the further modernization of America.

The trade – sustainability nexus

The juxtaposition between USA and China is expected to lead to a war between two camps in the global economy – that of neoliberalism and of regulatory statehood. Concerning trade, the new constellations are already taking shape. The first camp will be under the leadership of the English speaking-western camp, which will attempt to align to itself India, Australia and potentially Brazil. The second camp will be under the leadership of the European Union and China, which are the ripest emanations of regulatory statehood. The EU’s exclusive competence over the trade domain has led to the proliferation of trade negotiations with the different state and regional counterparts in Asia, as well as with Mercosur and South Africa[3]. While TTIP is still high on the agenda of the EU, it has become clear that the EU and the US would find it difficult to find a common denominator of the negotiations. Rather, the EU would reverse its available expertise in negative economic integration into a positive one by transforming its environmental and market standards into trade barriers. For the environmental domain is one of the essential legitimizing factors for the existence of the European Union, the European leadership would potentially adjust to the new reality by increasing its ownership over the environmental domain together with China. This would accrue further losses for the English-speaking world, as environmental goods hold the key to future economic growth.

Post-sovereignty or realist hegemony?

Trump and May have advanced themselves as proponents of a realist world, where hegemonic core-states would assume the role of agenda-setters globally. Their preferences clash substantially with the EU’s externalization of a post-sovereign order, whereby the EU uses its market to externalize both standards and organizational patterns[4]. The USA would rather prefer countries from the developing world to lack a form of self-organization, which would give them leverage in the trade negotiations. On the contrary, the EU sees in these potential like-minded collaborators, who are interested in advancing a forward-looking, post-sovereign agenda. Trumps’ and May’s neoliberal protectionism is an attempt to redirect taxpayers’ money from multilateral and regional organizations back to their own states. In addition to the financial disruption of post-sovereign establishments, Trump is deliberately propagating further „Exits“ of European Union member states, defining NATO as redundant[5] and phasing out the sustainable development goals from his agenda. For UK and US are nominal net payers, who are securing the functioning of regional and multilateral organizations, their phasing out would drastically cut available expenditures.

The consequences in the security domain would necessitate the reinvigoration of the existing security architecture in Europe. Although the OSCE has lived through a downfall, the revival of the East-West dichotomy will possibly necessitate a revision of the consensus-driven, non-binding rules making, as well as the low degree of institutionalization[6] of the organization. The possible withdrawing of NATO has resulted in the strengthening of the European Defence Agency’s capacity, as well as in programs for pooling of the capacities of EU member-states, which is rather directed at creating a pan-European defence procurement market, as well as increasing the effectiveness of research and innovation in the domain. In the environmental sustainability domain, the EU would continue with its manifold efforts at exporting its regulatory standards and shaping multilateral environmental negotiations. Concerning global multilateral efforts, it is quite probable that the EU would focus on increasing investment in environmental goods and technological transfer through the liberalization of trade in environmental goods among the highly industrialized states. It is namely there, where the EU would probably focus its protectionist efforts to undermine deregulation trends.

Effects on different regions

Along the security problematic, further research will explore whether the economic effects of the transition towards protectionism and the erosion of transnational institutions will actually take place, as well as how the new cooperation constellations will look like.

The most profound changes will be happening in East Asia, where China’s appetite for the territories in South China Sea is combined with an effort to step up globalization along domestic convictions for an uptake of inclusivity and sustainability. With the fall of the Trans-Pacific Partnership, China has reoriented itself into creating a free-trade area with ASEAN, Central Asia and other smaller countries that surround it. Its accession in the WTO, as well as the availability of capital reserves would allow it to prop up investments in the modernization of the economy, as well as the rewriting of the trade rules alongside new developments. Its One Belt, One Road initiative has increased the competition among other regional establishments in Asia and is likely to have substantial effects on Russia’s immediate neighbourhood, as well as on the programming of EU’s collaborative action eastwards. The American isolationism is rather seen as an opportunity for China to take over its place as global hegemon via the discussed plans.

Seemingly, OPEC countries in the Middle East have realized that the falling oil prices would result in maintaining good export volumes. However, the revenues from these are likely to be reinvested in an infrastructure that increases their own energy independence. While militant groups and issues with public health shake most of West and Central, and partially East Africa’s stability, regionalization and ceremonial public diplomacy is on the rise. African leaders are concerned mainly with development-oriented goals, such as securing access to water, food, shelter and education as a mean to offset expansionary growth. The European Union is readily investing in these sectors with its development aid, while attempting to build state institutions via horizontal cooperation. The expectation that Africa’s population will increase from 1.2 billion to almost 2 billion also makes such actions a necessity, as to avoid another migration crisis that will completely shatter Europe. Potentially, should UK exit the European Union, East and South Africa could be compelled to join the Global Britain project together with India and Australia.

South America, which was severely shaken by the oil bust, is focusing on diversification and poverty alleviation, with regionalism being largely on the rise with projects such as MERCOSUR, the Andean Communities, UNASUR and CELAC. The European Union is largely interested in a horizontal sharing of expertise, as well as the conclusion of an inter-regional trade agreement, modelled possibly on the lessons from ASEAN. While traditionally the North-South exchange on the continent was much stronger, Trump’s retaliation towards Mexico would serve as a lesson for the continent, which would seek alliances that will make it more independent.

[1] World Economic Forum, The world’s top economy: the US vs China in five charts, 05.12.16 https://www.weforum.org/agenda/2016/12/the-world-s-top-economy-the-us-vs-china-in-five-charts/

[2] The Atlantic, Trump’s Promises to Corporate Leaders: Lower Taxes and Fewer Regulations, 31.01.2017 https://www.theatlantic.com/business/archive/2017/01/trump-corporate-tax-cut/514148/

[3] European Commission, DG TRADE, Overview Of Fta And Other Trade Negotiations, February 2017 http://trade.ec.europa.eu/doclib/docs/2006/december/tradoc_118238.pdf

[4]  Sandra Lavenex & Frank Schimmelfennig (2009) EU rules beyond EU borders:

theorizing external governance in European politics, Journal of European Public Policy, 16:6,

791-812, http://tandfonline.com/doi/full/10.1080/13501760903087696

[5] Piotr Buras, Prepare for a New Europe, Stefan Batory Foundation, February 2017, p. 5-7 http://www.batory.org.pl/upload/files/pdf/rap_otw_eu/Prepare%20for%20a%20new%20Europe.pdf

[6] Leah Pybus, To Be or Not to Be: The OSCE in the ‘New Europe’, Interstate – Journal of International Affairs Vol. 1996/1997 No. 1.

Policy Brief §3: The G20 Summit between self-globalizing states and military buildup.

The G20 Summit between self-globalizing states and military buildup.

licence

Teodor Kalpakchiev

3-07

The world is now heading to the Hanseatic city of Hamburg, which has been one of the beating economic hearts of Germany for 800 years. However, for its hosting of a number of news outlets, it was a target of the violence of the extraparliamentary opposition, organized by the RAF in the 1970s. With the G20 Summit it seems that these two dimensions are converging. Since the global financial crisis, a stillborn balloon of the laissez-faire that brought one-third of the world’s wealth in the United States, many have taken rather distinct views. The EU, a supranational, state-like, non-state entity remains continuously committed to bringing together the best of world’s political philosophy in its trade deals by incorporating the odd externalities of liberalism such as welfare inequalities, environmental injustice and societal alienation. The isolationist West is dearly concerned with sharing its economic attainments with newcomers, while the East, led by China’s fast paced rebirth from a backward looking poverty stricken communist experiment to a blend of state-like control over the effects of capitalism with a globalization of the inner self.

To many, this is an expensive political meetup in times when problems are manifold. The sum of their actions construct non-governmentalism, which oftentimes takes a subjective and radical approach to societal problems. With G20 Germany has intentionally added up a new branch to world’s governance, which is inspired by the Sozialemarktwirtschaft and the culture of creating networks of structures. In essence, the inclusion of a civil society and youth component marks a transgression from the word “summit”, which in German translates as a meeting on the peak (das Gipfeltreffen). The tradition, which stems from the times of the German Staemmen (tribes) emphasizes the importance of equality over hierarchy. Its significant benefit is the ideational inclusion, which however grants a form of authority in its modern sense. With the police, the supreme organ of control over anarchistic propagations, being stripped of its own, the rise of ultra-leftist formations in Europe such as the Left in Germany and DiEM25 in Greece could easily utilize the potential clash between an authorizing society and disloyal state organs that are the embodiment of the all-encompassing bureaucratic and elitist alienation. However, the left not simply a synonym of the humanistic societal foundations, but also an allegory for the Eurasian alternative for political governance. Albeit not interchangeable, they reveal yet another mean for pressure over democracy in a social market economy.

With the Russian fast-paced incorporation of its newest democratic self-determined constituents in the background, the pressure over the buffer zone beyond EU’s eastern borders has renewed the concurrent manifestation of strength by the United States. For being largely isolated by Western powers, he has decided to play the forsaken card of historical memory that provides him psychological advantage over Germany, which still feels ill at ease with the topic. The EU’s continuous investment in Polish infrastructure has brought Warsaw much closer to the West not only in terms of outlook, but also in terms of economic practices. The polish voice is the strongest within the sub-regional backlash against what is seen as German externalization of internal historical responsibilities onto the European policy agenda. The recent Austrian plug into the V4’s favour of control over excessive migration uploads the topic onto the agenda consisting of trade, globalization, poverty and security issues.

LogoG20_teaserbild

What can one expect during the meeting of G20? Trump would most probably try to use his new allegiance with the Shia and the anti-migrant rhetoric to plunge into a well-organized, structured discussion. For the EU is attempting to establish its own security community, his is intent on being identified as the biggest troublemaker for Russia, thus cementing Ukraine as the biggest dividing factor and dooming any possible advancement of the Minsk 2.0 accords. China’s 11$ billion funding of Russia’s state development bank could be seen as a fortification of the one belt aspirations and could be utilized by Germany to press over the Ukrainian issues. The trade-globalization-development nexus would definitely stand firm on top of the agenda, as the readjustments of the winners and losers of globalization is probably what German social market democracy has most answers for. With no concessions planned for Brexit, the crucial aim of the hosts would be to multiply European standards of governance in the developing world and according to the high aspirations of its trade agreements with the rest of the global north.

Publication §1: Historical Constructivism and the Bulgarian Council of EU Presidency: Policy Externalization towards the Eastern Partnership

 

1-07

Historical Constructivism and the Bulgarian Council of EU Presidency: Policy Externalization towards the Eastern Partnership

Teodor Kalpakchiev

licence

(All content must be properly cited. Published by the University of Plovdiv in a collection of studies on the Bulgarian 10 years’ EU membership anniversary.)

Abstract

The paper presents a historical constructivism argument for Bulgaria’s involvement in the Eastern Partnership matter. Subsequently it explains the developments of the ENP I and II (to be updated with ENP III). It then uses a polling method to gather opinions on certain stances related to the Bulgarian Council of EU Presidency and the Eastern Partnership of the EU, which are presented graphically and analysed. Then, a comparison between the most pressing policy problems in Bulgaria and the Eastern partnership is presented. Overlaps are discussed in lieu of Bulgaria’s stances towards the programming of the ENP and its leadership in the Eastern Partnership. The paper argues that commonalities in the region require similar solutions and the Council of EU Presidency is the platform, where Bulgaria can reveal these dependencies (related to corruption, state capture, energy governance, finances).

 

Keywords

Neighbourhood, Corruption, Diversification, Security, Bulgaria

 

Introduction

After the fall of communism, the countries behind the Iron Curtain were reestablished as loosely shaped structures with anarchic intra- and interstate relations. Different paths of economic development, reconstruction of national identities and variability in institution building were brought together only after the exponential “Big Bang” Enlargement of the European Union. For Bulgaria has been among the traditional backbenchers, the lessons learned during its first 10 years of membership prove vital for the further integration eastwards.

Context and Methodology

The disillusionment with the absence of reforms and the increasing political scandals, Bulgarians and Ukrainians took the streets in 2013-2014. This paper attempts to abridge domestic predicaments in Bulgaria with the stalemate in the Eastern Partnership and argues that Bulgaria can upload transferrable solutions through its Council of EU Presidency. Its analytical framework relies on a poll consisting of 16 questions scaled with five possible measurements, as well as two questions directed preferences for policy priorities, whereby the 39 respondents[i] had to choose four out of ten possible answers.

Theoretical assumptions

As Ted Hopf points out, state identities in world politics are the product of social practices at home and as such enable state identity, actions and interests abroad.[ii] As a result of the Bulgarian multi-ethnic heritage the construction of a state identity becomes subjected to a revision of historical interpretations that may otherwise result in societal cleavages. Then, its reproduction of “intersubjective meanings that constitute social structures and actors” domestically could be turned into internationally legitimate practices with a degree of predictability[iii]. Their implementation has two important prerequisites – the existence of common structural contexts with the subject, as well as a shared collective identity (e.g. based commonness or a threat) with states that can form a coalition[iv]. At the same time, a policy entrepreneur, in that case Bulgaria, must conform with the “logic of appropriateness” defined by social norms and institutional rules, as well as those of the international community[v]. For being a relatively minimalist state, it could rely much more on epistemic communities[vi] to utilize and maximize its stake in the realization of particular policy project in the Eastern Partnership countries. Institutions (to be read sets of rules and norms) can penetrate into Bulgarian foreign policy, the articulation of it, common platforms, etc. revealing thus that Europeanization must not simply be a reflex to a lack of alternatives, but a holistic effort[vii]. Due to the shared history in the period between antiquity and the middle ages, as well as during the latter part of the 20th century, the interests and the behaviour of their actors and institutions Bulgaria and the frontrunners from the Eastern Partnership will be framed in a framework of historical constructivism. My argument is that, while the immediate past has resulted in a feigned form of statehood and democracy, the common distant past can serve as an engine for institutional learning and policy transfer.

The Evolution of the European Neighbourhood Policy

In terms of programming, the ENP has functioned both as an extension and Ersatz for further aggrandizement of the EU. The Enlargement policy of the latter has largely been defined as the “a process of gradual and formal horizontal institutionalization of organizational rules and norms”[viii], aimed at “the reversal, if not the total elimination of the democratic deficits or illiberal traits”[ix], as well as the externalities of economic transformation. It is marked by deepening and widening of “downloaded” policy patterns safeguarded by the pacta sunt servanda principle[x]. The pragmatic management of the policy is achieved through the employment of the conditionality principle, resp. giving rewards for achievements, which in the case of European Neighbourhood Policy is enhanced through “naming and shaming”, resp. negative conditionality. Beyond aid, legal approximation and market opening, the ENP relies largely on socialization through the EuroNEST parliamentary assembly, the Eastern Partnership Civil Society Forum and the penultimate reward – freedom of movement of persons, tightly intertwined with the hybrid Deep and Comprehensive Free Trade agreements, which include numerous stipulations on improvement of governance.

Historically, the ENP has begun with the Barcelona Declaration for a Euro Mediterranean Partnership (11.1995) that focused on democracy export to MENA blended with economic rationales. While the policy entrepreneurs in this case were France and Spain, the UK and Denmark came up with a separate “New Neighbours Initiative” meant to address the countries standing beneath the eastern external border of EU with a strategic focus on Ukraine, Belarus and Moldova in April 2002, which was elaborated by Poland in November the same year. Thus, although a “proximity policy” was already mentioned in the Enlargement strategies, the first official communication from the Commission came only in 2003[xi]. It aimed, in lieu with the (old) Security Strategy, to bring about a belt of stability and prosperity that can now be interpreted as a buffer of and testing site for EU’s foreign policy. It delivered bilateral enhancement of the regional approach towards the neighbourhood, expansion of its geographical scope, as well as rationalization of overlapping instruments (TAIEX, SIGMA, TACIS, MEDA, TEMPUS, etc.). For having already begun to overcome the externalities of its economic and political transition, Russia neglected the offer to join the ENP and was subsequently reproached with the “Four Common Spaces”[xii], which relied on a roadmap with no conditionality (in contrast with the Association and the Partnership and Cooperation Agreements). The main building block of rewards (in the scientific debate “carrots”) was market access through (enhanced) FTAs and increased allocations through the Neighbourhood Investment Facility. Beyond regional programs funded through the ENPI, concerns such as democracy and human rights (EIDHR), nuclear safety (INSC), poverty and development (DCI) and financial stability (IfS)[xiii] were also targeted.

At large, the ENP has lived through three stages, which can be described as a transition from an ambitious regional approach towards democracy building and overall leverage through an agenda underpinned by the fragility in the Middle East and North Africa and implemented by means of comprehensive strategies to the current pragmatic focus on governance, individual strategies towards each country and differentiation according to the achieved results. With respect to the specific focus of the paper it Eastern Partnership of the EU was largely influenced by the agendas of the Polish, Swedish, Czech and Lithuanian Council of EU Presidencies and came into being after 2008.

Due to the exclusion of Russia for long it was not clear whether the idea of the policy is the expansionist assimilation of the countries, or simply the establishment of a strategic partnership. Most recently, esp. after the redefinition of the UN’s Development Goals and the revision of the Cotonou agreement, the scientific debate has switched towards establishing partnership of equals, whereby the subjects of the policy have increased rights over the “ownership” of its programming. Additionally, the state-centric approach gradually transitioned to focus on building non-state actor’s capacity. In contrast with the Enlargement policy, the absence of the membership reward resulted in asymmetrical, selective and piecemeal rule adoption and application[xiv], which was further fragmented by the inconsistent application of negative conditionality[xv]. The break with the “one size fits all” policy was achieved in 2015[xvi], as the best performers in the East were awarded more aid through the umbrella financing of the policy, accession to the common market through the signing of Deep and Comprehensive FTAs, as well as, partially, freedom of movement of persons. The biggest stalemate in the policy has been triggered by the “frozen conflicts” in Transnistria, Donetsk, Nagorno-Karabakh, Abkhazia and Ossetia. Their maintenance is dependent on the stake of pro-Russian fractions and puts EU’s conflict resolution, peacebuilding and diplomatic capacity at an important test. The solution of these conflicts holds the key towards potential enlargement to the East.

Hence ENP has been initially assessed as a high-profile, but low valence attempt at establishing democracy in North Africa, which has no traditions in that area. Later, its purely economic stimuli proved inadequate due to insufficient financing and the large geographical scope. The competing claims of the Organization of Islamic Cooperation, the Eurasian Economic Union, as well as China through its One Belt, One Road initiative have only increased the stakes for EU’s ability to successfully program the extension of its Enlargement policy. The ENP has thus become prototypical example of structural foreign policy[xvii] that includes transfer of values through socializing and normative approximation through “selective extension of the EU’s norms, rules and policies”[xviii] and institution building.  Despite its attempts at differentiation, such has been achieved barely in the third revision of the policy in 2015, as before it was assessed as “driven by a desire for standardization and homogeneity and for asserting the EU’s hierarchical position”[xix].

The scientific debate has had a strong influence in not only explaining and assessing EU’s interventions, but also in contriving conceptual innovations. Within the domain of foreign policy, the EU was initially explained as a “civilian power”, which protects the fundamental rights of humans and attempts to maintain peace around the world. Since then, the concepts of “market power”[xx] and “normative power”[xxi] have taken the lead in defining the corporeity of EU’s foreign policy, which is playing a significant role in structuring globalization.

Bulgarians and the Eastern Partnership

The scientific debate over the early history of the Bulgarian statehood is currently shifting towards theories preferring explanations of their genealogy confined in the eastern European, resp. West-Eurasian locality. This is both because the ethnical depiction of the nation has ever since been influenced by the rise of Russian Slavophilism, which emphasized starkly the Slavic origins in the first official History of Bulgaria[xxii], as well as because the impact of the proto-Bulgarians on the indigenous Thracian and migrant Slavs has been overlooked[xxiii]. Although early settlements might include the Balhara Kingdom in today’s Afghanistan and Uzbekistan, as well as today’s Armenia, evidences for socio-cultural heritage are much ampler in the Eastern Partnership of the EU. To begin with, Old Great Bulgaria was founded on the territory of the currently occupied Crimea and Eastern Ukraine and Odessa (170 166) was one of the early place d’armes towards the Danube. To the north of Georgia, we may find the Kabardino-Balkaria Republic (112 924) and in Moldova (67 630) there is a pronounced minority of Bulgarians resettled during the Ottoman rule. One can’t also forego the fact that the Chuvash (1 637 094), Volga Tatars (5 310 649) and Karakalpaks (4466) in Russia have alternating, yet existent ethnical affiliation with the Bolghar tribes. In short, the Eastern trajectory of the Bulgaria foreign policy has been triggered by a historical necessity to extend the founding value of European unity.

After 2014, when the complete study was conducted and distributed to policy makers, two of them – the ex-president Plevneliev and MEP Mariya Gabriel became fervent supporters of the Eastern Partnership, resp. through voicing stark opinions towards the Crimean question and becoming a rapporteur on the visa liberalization with Georgia and Ukraine. The Bulgarian Ministry of Foreign Affairs, due to its financial constraints, has been active through disbursing scholarships and delivering lecturers in the target countries. However, there is no mention of a Bulgarian non-state actor involved in the preparation of the EU’s Global Strategy[xxiv]. Due to the intricate relationship between the MFA and the executive the Bulgarian state was also not represented at the 23. Ministerial Council of the OSCE, which dealt almost exclusively with the Ukrainian question. These examples can only serve as a reference of a complete, yet limited ownership of policy entrepreneurship by the state, which hinders the potential diversity of policy proposals, as well as the potential erection of epistemic networks. With the new president-elect, the last echo of a pro-integration stance has been dulled.

Empirical Data

Statement Strongly Agree Agree Neither Agree nor Disagree Disagree Strongly Disagree
1. I see only negative sides from Bulgaria’s membership in the European Union? 5% 5% 18% 33% 39%
2. There are direct effects of the recent events in Egypt and Ukraine in Bulgaria. 21% 28% 33% 12% 5%
3. There is a interrelationship between the governmental instability in Bulgaria and Ukraine. 5% 21% 28% 31% 15%
4. Politicians have learned a lesson from the protests in Bulgaria and the situations will improve. 2% 13% 26% 18% 41%
5. There are numerous ways for a small country to be influential within the European Union. 26% 26% 28% 10% 10%
6. In the next legislature period in EU /2014-2020/ the significance of Bulgaria’s position will increase. 2% 8% 41% 31% 18%
7. I understand well what is the European Neighbourhood Policy. 23% 33% 15% 21% 8%
8. Russia’s actions can be defined as neo-colonialism and neo-imperialism. 36% 28% 8% 20% 8%
9. Protests against governments is the only efficient way to defy state capture in the region. 10% 23% 33% 26% 8%
10. The increased representation of Eurosceptic and far-right parties contributes to the democratic nature of the European Union. 10% 8% 31% 33% 18%
11. The Presidency of Council of the European Union that Bulgaria will hold in 2018 is a viable opportunity to solve domestic problems in the country. 3% 36% 33% 18% 13%
12. The European Neighbourhood Policy poses a challenge to the inefficient coordination of foreign policy in the European Union. 10% 41% 34% 10% 5%
13. There are no enlargement perspectives towards the countries that are taking part the Eastern Partnership. 8% 20% 26% 36% 10%
14. I see no security threats for Bulgaria as a result of the disturbances in the Middle East. 13% 15% 21% 23% 28%
15. Only economic interests of certain member states in the EU matter when it is dealing with the European Neighbourhood Policy. 13% 18% 23% 23% 23%
16. I see that as an external border of the EU and a country in the Black Sea Region Bulgaria will have to increase its maritime security expenditures. 10% 31% 23% 28% 8%

1

Figure 1. Domestic Priorities in Bulgaria According to Respondents (2014)

2

Figure 2. Preferences for Priorities of the Bulgarian Council of EU Presidency According to Respondents (2014)

Options for exerting influence – Case studies and Scientific Discussion

Sweden is a relatively small state, which maximized its bargaining power during its Council of EU Presidency. By focusing on conflict prevention and taking advantage of its recognized efforts in the matter, it successfully employed framing, diplomatic tactics and timing. For this to work an actor must remain observant of possible interpretations and actively construct the norm within a foreseeable period, adjust it to the evolving context and meet expectations, while existence of a political document with guiding principles remains crucial. Sweden’s actions consisted of:

  • Distribution of an Action Plan in the MS capitals
  • Informal contacts in consideration of backing up the proposal by other MS (Finland, Germany, Italy)
  • Avoiding putting too much effort on partners with little interest or alternative visions
  • Utilization of competition for power within EU institutions
  • Good personal communication, distribution of materials
  • Counting on the Council Secretariat for achieving broad acceptance and expertise
  • Avoiding over-institutionalized forms of shaping the policy proposals

Poland attempted to secure membership prospects for Belarus, Ukraine and Moldova already in 2003, but bumped into Spain and France, which were competing for financing with an agenda on the South (bg must step in to improve prospects). Instead, Poland advocated a separate track in the ENP, found supporters in the face of Czechia and Sweden and faced no constraints from southern member states. Yet, Poland did not manage to make full use of the V4 regional block in the effort sharing towards the Eastern Partnership track, as well as of the existing human capital in the EU institutions, which could have compensated the lack of diplomatic experience. Poland’s turning into an extension of the Franco-German duo through the Weimar triangle played a significant role in the advancement of the inclusiveness, democracy and reconciliation agenda towards Ukraine.

The two cases reveal that the “uploading” of domestic issues and problems onto the European agenda might play a vital role in the successful chairmanship of the European Union, as well as provide a boost for the foreign policy. While Brexit has functioned as a catalyst of an accelerated preparation process, domestic agenda setting remains fluid due to the necessary stabilization of party dynamics and actors interests. Yet, as can be seen from the empiric material, there are substantial overlaps between the domestic priorities in Bulgaria, as well as the preferences of respondents towards a potential agenda for a Council of EU Presidency. While respondents have chosen the ENP as a second most vital priority, their preferences reveal considerations toward sectoral policies such as Anti-Corruption, the Energy Union, Banking Union, Education, Security and Defense. Besides tackling corruption, the Energy and Banking Unions, immediate problems such as economic restructuring and independence of media seem to be most important domestically. Albeit limited in scope and outreach, this poll could serve as a legitimization of the real Council of EU agenda, esp. since public ownership is a prerequisite for a successful policy cycle.

Separately, the statements could abridge the two agendas with the Neighbourhood[xxv]. The parallel between Bulgaria and Ukraine includes not only the protests against the dysfunctional, captured state, resp. the continuous necessity of enforcing anti-corruption rules, but also the energy dependence to Moscow. The fact that people have seen protests as a viable alternative to political participation means only that their inclusion in policy-making can subdue such emotions. Already then the negative stance towards Russia could explain why far-right parties are not considered as democracy-enabling actors. The potential of the Council of EU Presidency as an interface between the nation state and the post-sovereign, supranational institutions is seen as high by only half of the respondents, which can be explained with the general negative stances towards domestic governance. The ENP is seen is difficult to implement possibly because the ownership of its implementation is shared between (some) of the member states, as well as DG Near of the European Commission, the European External Action Service, as well as diplomatic representations and NGOs in Brussels. Nevertheless, a majority of the respondents believe that the Enlargement towards the Eastern Partnership is indeed possible. More of them do also foresee beneficial effects of market integration on both sides of the equation. A rise in expenditures for land and maritime security is not preferred though.

Towards a focus on the Eastern Partnership through Externalization of Domestic Solutions

The vital question remains how to bridge domestic preferences with the Neighbourhood through the Council of EU Presidency and turn these into concrete legislative proposals or initiatives. With specific regards to the topic, one sixth of the respondents saw the ENP as a necessary focus of the Presidency. The section will group the analysis in three categories – good governance, energy security and economics.

Corruption continues to be the most endemic issues, as Bulgaria is the single member state that is still scrutinized by the post-accession conditionality of the Cooperation and Verification Mechanism. The country fails to address vested interests, the consistency and independence of the judiciary, the lack of effective prosecution and conviction of organized criminal groups. Of utmost importance remain therefore emblematic convictions of higher officials and politicians that can foster the credible and impartial rule of law. Bulgaria should concentrate on domestic resource mobilization, transparent procurement, fighting conflict of interest, nepotism, as well as the shortening of the Chief Prosecutor’s term of office (to 1 year). After the completion of the CVM mandate, the lessons learned should be applied vigorously in the Eastern Partnership. As a holder of the Presidency, Bulgarian authorities should advocate that the CVM be included in the programming of the ENP and engage directly on spot to train non-state actors. Media ownership transparency should be increased in lieu of uncovering the interests behind the content in domestic media. Last, but not least, hate speech limitation domestically must be combined with a harsh rhetoric against Turkey’s disrespect for human rights and political freedoms.

Through diversification and improved efficiency energy security remains high on the agenda of the EU and its 2020 targets. Even if gas consumption is falling, dependence on external suppliers such as Russia (32,4%), Norway (26,7%), Algeria (13,0%), Qatar (11%) continues[xxvi]. With South Stream having fortified the Russo-Turkish friendship, the question over the Nagorno-Karabakh conflict becomes a litmus test for EU’s diplomacy. Despite the fact that Armenia is in the Eurasian Union and the Collective Security Treaty Organization, Russia continues to provide arms to Azerbaijan bought through gas exports. Hence, the lowering of gas prices and diversification of suppliers in Bulgaria can happen only when the conflict is brought to a halt. Bulgarian authorities could use the prisoner’s dilemma tactics and backup their claims for non-discriminatory access from Russia with the alternative scenario of supply through Azerbaijan. If necessary, they could launch a domestic initiative for partial revival of the Four Spaces with Russia (e.g. establishing R&D networks) since the federation holds the biggest depot of resources and is a large polluter. Removal of sanctions, albeit existent in the discussions, should be subjected to the solution of the separatist tendencies in Ukraine and the respect of the Minsk Commitments. When it comes to energy efficiency, the launch of centers for free public consultations on improving household energy and resource efficiency, building’s sanitation, procuring shared renewable energy installations, establishing bio, shared and circular economy business should be created in each large regional city. With regards to traditional security, rebuffing the naval fleet and the training of asylum seekers and refugees to work in the agricultural sector, handcrafts and small businesses could ensure a better stance in negotiations with the non-EU neighbours.

Economic diversification beyond IT services remains a problematic issues and continues to lead to significant brain-drain of engineers, natural and social scientists. On one hand the lack of any significant added-value manufacturing leads to an opportunity cost for the economy and on the other, the market rationale leads to deprivation of the domestic consumer of local bio-produce, which is sold as “bio” in other member states and substituted with greenhouse grown plants. Tax breaks for investments in added value and high-tech sectors, as well as state subventions for bio- and circular economy initiatives (e.g. repair services, eco-industry, production of solar panels, electric vehicles, autonomous agricultural, processing and recycling machinery) must be complemented with increased efforts at improved domestic resource mobilization (e.g. issuing VAT bills). The creation of industrial research center(s) with focus on sustainable transportation and housing components and turning waste into resources could make use of the well-qualified labour in the Eastern Partnership and forge important ties. During its EU presidency, Bulgaria should attempt to redefine EU’s own resources by advocating the adoption of a Tobin Tax on financial transactions (that could compensate the clampdown of KTB) that would expand to DCFTA members, so as to consolidate the banking sector and avoid scenarios such as the banking crisis in Moldova. Additionally, it should propagate the establishment of an environmental customs union that includes DCFTA members, stimulates the adoption of EU’s regulatory patterns from trade partners and provides new revenues to EU’s budget from non-compliant actors. Naturally, accession the Eurozone and the Banking Union, improved economic and fiscal surveillance of the neighbours and maximization of the New Silk Road opportunities should also remain as priorities.

Conclusions

The historic junction between Bulgaria, the Eastern Partnership and Russia has continued into modern times and has transformed into a competition for integration of the countries between EU and Russia. The common history, cultural, linguistic and theological ties between Bulgaria and the Eastern partners of EU could be utilized by shaping the interface between identity, institutions and actors’ interests and framing it within EU’s regulatory integration. The empiric material of this paper reveals substantial overlaps between the preferences for domestic priorities and an agenda for the Presidency. As the case studies reveal, with adequate outreach to partners and coalition-building domestic problems can be transformed into a policy agenda for the Council of EU Presidency that Bulgaria will hold in the first half of 2018. The subsequent analysis frames the existing problems in three categories – good governance, energy security and economics and proposes policy initiatives that are relevant both domestically and for the Eastern Partnership branch of EU’s multivariate foreign policy.

[i] Profile: 77% of the respondents were Bulgarian citizens and 23% – citizens of foreign countries. The majority were in or had completed the tertiary cycle of their education.

[ii] The Promise of Constructivism in International Relations Theory, Ted Hopf, International Security, Vol. 23, No. 1 (Summer, 1998), pp.195

[iii] Ibid. pp. 174

[iv] Collective Identity Formation and the International State, Alexander Wendt, The American Political Science Review, Vol. 88, No. 2 (Jun., 1994), pp. 389

[v] Casier, T. (2008). The New Neighbours of the European Union: The Compelling Logic of Enlargement? In J. DeBardeleben, The Boundaries of EU Enlargement: Finding a place for the Neighbours (pp. 19-33). Palgrave, p.28

[vi] They transcend material means and rely much more on people-to-people contacts. Examples include interparliamentary forums, academic exchange and research networks, confederalization of NGO structures, etc. See Sebenius, J. K. (2009). Challenging conventional explanations of international cooperation: negotiations analysis and epistemic communities. International Organization / Volume 46 / Issue 01 / December 1992, pp 323 – 365, DOI: 10.1017/S0020818300001521, Published online: 22 May 2009 , 323-365.

[vii] Andreatta, F. (2011). The European Union’s International Relations: A Theoretical View. In C. Hill, & M. Smith, International Relations and the European Union. Oxford University Press.

[viii] Sedelmeier, F. S. (2002). Theoritizing EU enlargement: research focus, hypotheses, and the state of research. Journal of of European Public Policy, 9:4, 500-528, http://dx.doi.org/10.1080/13501760210152411 , p. 503.

[ix] Cohen, L. J. (2008). The Europeanization of ‘Defective Democracies’ in the Western Balkans: Pre-accession challenges to democratic consolidation. In J. DeBardeleben, The Boundaries of EU Enlargement. Finding a Place for the Neighbours (pp. 205-222). Palgrave.

[x] Accession requires the adoption of primary law of the treaties and respect of the Copenhagen criteria.

[xi] Wider Europe — Neighbourhood: A New Framework for Relations with our Eastern

and Southern Neighbours, 03.2013, http://eeas.europa.eu/archives/docs/enp/pdf/pdf/com03_104_en.pdf

[xii] See EU/Russia: The four “common spaces”, http://europa.eu/rapid/press-release_MEMO-04-268_en.pdf

[xiii] European Neighbourhood Policy: History, Structure, and Implemented Policy Measures

Edzard Wesselink & Ron Boschma, 10.13, pp. 9-11

[xiv] Langbein, J., & Wolczyk, K. (2011). Convergence without membership? The impact of the European Union in the neighbourhood: evidence from Ukraine. Journal of European Public Policy, Volume 19, Issue 6, 2012 , pages 863-881.

[xv] Langbein, J. (2013). Die Europäische Nachbarschaftspolitik. In E. Stratenschulte, Grenzen der Integration: Europas strategische Ansätye für die Nachbarregionen (pp. 29-55). Nomos, p.39.

[xvi] Review of the ENP, EEAS, 11.2015, http://eeas.europa.eu/archives/docs/enp/documents/2015/151118_joint-communication_review-of-the-enp_en.pdf

[xvii] Landaburu, E. (2006). From Neighbourhood to Integration Policy: Are there Concrete Alternatives to Enlargement? Retrieved from CEPS Policy Brief No. 95: http://aei.pitt.edu/6600/1/1305_95.pdf, p.3

[xviii] Lavenex, S. (2011). EU external governance in ‘wider Europe’. Journal of European Public Policy, 11:4, 680-700, DOI: 10.1080/1350176042000248098 , 680-700, p.694

[xix] Browning, C. S., & Joenniemi, P. (2008). The European Neighbourhood Policy and Why the Northern Dimension Matters. In DeBardeleben, The Boundaries of EU Enlargement: Finding a Place for the Neigbours. Palgrave Macmillan.

[xx] See Chad Damro, Market Power Europe, University of Edinburgh / Europa Institute, 2011

[xxi] See Normative Power Europe: A Contradiction in. Terms?* IAN MANNERS. University of Kent at Canterbury. JCMS 2002 Volume 40. Number 2. pp. 235–58

[xxii] Mihăilescu, e. a. (2008). Studying Peoples in the People’s Democracies II: Socialist Era Anthropology in South-East Europe. Münster: LIT Verlag, p.148

[xxiii] Karachanak, S. e. (2012). Bulgarians vs the other European populations: a mitochondrial DNA perspective. Retrieved from Int J Legal Med (2012) 126:497–503, p. 497-8

[xxiv] The only explicit mention is of the Bulgarian Diplomatic Institute, see Shared Vision, Common Action:

A Stronger Europe: A Global Strategy for the European Union’s Foreign And Security Policy, 06.2016, pp. 54 http://eeas.europa.eu/archives/docs/top_stories/pdf/eugs_review_web.pdf

[xxv] Due to the limited size of the paper, the discussion of the results will include only an analysis of these that have a correlation with the topic.

[xxvi] EuroStat. (2013, May). Natural gas consumption statistics. Retrieved from http://epp.eurostat.ec.europa.eu/statistics_explained/index.php/Natural_gas_consumption_statistics

Policy Brief §2: Towards pan-European Liquid Democracy?

Towards pan-European Liquid Democracy?

Teodor Kalpakchiev

1-07

Introduction

The potential underrepresentation of the Bulgarian diaspora, as well as exclusion of the anti-corruption pact, the alternative to European conservatism and the non-effectuation of a progressive liberal left necessitates the adoption of new patterns of inclusion in the decision-making process. Referenda are on the rise, yet an expensive democratic innovation within the confines of the country marked by centralization of political power, economic interests and the right to initiate legislative proposals. Regions are bereft of mindful individuals that generate economic revenues and thus rely extensively on subventions from the state. Hence, this dependence is subjected to the cooperation readiness of an actor with limited democratic legitimacy. Additionally, it has become clear that a nation- and political spectrum-wide consensus for the future development of the country is necessary. Bearing in mind the exponential advancement of digital technologies, as well as the e-government expertise accumulated in the previous partner of the Council Presidency Trio, Estonia, the challenge to democracy can currently be crumbled down to a number of fundamental questions:

 

How to ensure the efficient and continuous link between the voters’ constituency and the effects sought for initially?

How to increase the democratic legitimacy of strategies for regional and supranational development?

How to secure voters’ informed decision-making and the protection of their personal data?

licence

Towards a Liquid Form of Democracy

What does liquid democracy entail? It can be described as a continuous, shapeless, decentralized process of preference formulation that allows for adjustment, should any substantial changes take place. It relies mainly on small scale, digitally confined establishments that allow a group of dissimilar interests with a locality to be crumbled down to numerical exemplification. The collective will of these sub-entities is collected and analyzed via a necessarily independent private operator, whose services are procured after a rigorous check from a supranational actor.

How will this work in reality? Each regional municipality creates a unit consisting of IT and big data professionals and applies for European funding to procure secure servers, the establishment of a database, an user-friendly site, USB-based digital signatures for each of its citizens, as well as any other technical equipment that might become necessary, such as an UPS.

Then, it creates a vision for the future development of the region based on alternating scenarios. These include sectoral policies that are vital for the implementation of the UN post-2015 development agenda, such as natural resource and food security, low-carbon adaptation as a pathway towards competitiveness, public health and fostering technological innovation, while adjusting each scenario for specialization possibilities. It prepares a sufficiently strong and wide-reaching communication campaign spanning over at least six months before launching its first public opinion drilling that is limited strictly to registrants in the region, who own property. The vote is recast up to three times, if less than a simple majority of the voters’ preferences is collected.

Defining Regional Development

Upon the selection of the regional specialization scenario, the municipality then goes on to restructure tax collection, while paying special attention to resource mobilization. Within a low-carbon adaptation scenario, this would mean for example shifting from taxing labour to shifting waste, the usage of resources and energy. Additional adjustments, such as the creation of regional markets for electrical and emission certificates, dropped down from the state platform for allocation will ensure that non-competitive and non-complying private actors are brought down to default. Emissions from cars, households and land use change and economic activities are collected and the biggest polluters are targeted with command and control policies for accelerated reductions. Any revenues from non-compliance are then reinvested into research and innovation, creating entrepreneurial hubs and sponsoring local businesses. Yearly reports based on predefined collectibles are then publicly presented in the state radio and television and voters are asked to adjust their preferences if not satisfied. Thus, the public body maintains continuously balance between a coercive form of executive implementation and societal interests.

Ensuring Data Security

/Interview with Mariyan Ivanov – Global Service Desk Officer @ Adecco/

The predominant necessity for a transition to a fluid, continuous and elastic process of decision-making would be data security and the enactment of independent overseeing and enforcement bodies, which would act in cases of disrespected codification. As starting point, one must underline that voting digitally would not be an economically viable system due to the high initial costs. Firstly, the government must procure a number of USB-based electronic signature certificates that is equal or higher than the number of the electorate with passive voting rights. The additional, resp. substitutive items must be kept safe in a vault. Each certificate must come with an initial password token enclosed in an envelope that allows the logging in into a web platform and the selection of a final password. The password would inquire the use of a range of characters. Its confirmation would ensue with the registration of a phone number for emergency contacts, which will receive a pin number, resp. a token. Each time one voting is required the person will enter the token and be redirected to a website, valid for one minute, which will require the use of the electronic certificate.  All data should be stored on servers, locked with access cards and pin codes and protected by security officers. Servers should have backups and UPS systems attached to them and be locked to each other with a chain. Two IT companies, working on Pen testing will be continuously checking whether the data could leak. Any update of the system will be conditioned to approval from system administrators with proven and experience and controlled impartiality. A national system with customer support will ensure that users understand how the system works.

The Responsibility to be Sufficiently Informed

Two inherent issues need discussion, in case these requirements take place. The first one is related to the transfer of responsibility from the electorate to the national parliamentary representatives. Psychologically speaking, the current state of democracy based on cyclic elections is a convenient way for the voters to seek responsibility from its delegates, while retaining none of it themselves. The problem lies in the fact that thus the voters are also bereft of the responsibility to remain rationally informed on the political processes and are counting on an often only allegedly independent judiciary to protect their interests. The key to democratization is in the debate that ensures democratic innovations, resp. its relegation from the parliament back to the citizenry.

It must, however, be accompanied by an overarching sense of justice. It would rely on the relegation of responsibility for being sufficiently informed back to the voter. Further, one must cater for the abolishment of the post-truth servility of traditional media to political interests and transforming them into businesses aimed at informing the society of the nature, alternatives and the consequences of their cast votes. The way to do that will be to 1) forbid any stimulus to purchase goods and services not related to the information itself, 2) use taxes for the equitable distribution of the information to those not being able to pay for it and 3) abolish national parliaments in small state entities, which are part of larger regional integration units. While being a contentious solution, the depoliticization of the information flow is largely contingent upon the abolition of local, largely non-representative political interests.  Within a digital voting system, regional and national parliaments could become redundant. Thus, the responsibility for taking informed decisions will be relegated back to the voters and will ensure their effective politicization.

The Pathway to Democratic Federalization of the EU?

While in this article I have discussed some technical, sectoral and ethical issues I had in mind the current shift in European governance, which is the overarching topic of the governance project of the ENPI. If the technical solution is applied on the level of Nuts 3 to Lau 2 (e.g. regions to municipalities) in all member states, it would result in a number of subsystems for the collection of voters’ will that could be used for the organization of pan-European referenda. While the European Commission has infrequently used its White Book card, the White Paper for the Future of Europe’s scenarios could easily be transformed into an online poll with short explanatory overviews of the consequences involved.

Once the pan-European citizenry decides on a scenario, the transition to the new form of statehood will follow suit.