A recent interview with Viktor Orban, Hungary’s Prime Minister and the new EU Council President, is a good place to begin discussing what 2011 holds in store for Europe. The two most significant (and non-fiscal or monetary) items highlighted by Orban were strategies to manage the Roma population, and stronger integration with Southern and Eastern Europe. On the latter subject, 2010 proved a watershed year for recognizing the obstacles facing Europe’s permanent underclass — and pinpointing countries who have assimilated the group. In particular, Spain was singled out as the country that has worked most aggressively to improve Roma quality of life. It has spent millions of dollars on setting up non-ghettoized public housing as an alternative to encampments, and also on job training programs. Such an effort is the mirror image of President Nicholas Sarkozy’s deportation initiative. It would truly be disappointing if Orban did not pursue this initiative, because it’s an issue that seems tailor-made to be dealt with at the Union level.
That said, there are no quick fixes, and the potential for an even greater influx of Eastern European immigrants has been cited as holding up Romania and Bulgaria’s effort to join the Schengen zone. Bulgaria and Romania are diverging on how — or whether — to break into the zone. The sticking point is the Control and Verification Mechanism, which gave Brussels unprecedented monitoring powers over both countries’ judicial systems. Bulgaria has been negotiating with France and Germany over what they might do to accelerate access and loosen the CVM restrictions. But a recent statement from Romania’s foreign minister suggested the country could go rogue and ditch the CVM altogether.
At a minimum, he said, such standards should be applied to Croatia, which is entering the final phase of its accession negotiations. Despite the Eurozone crisis, Croatia still appears eager to join the Union, and could wrap up its candidacy by the end of the year, positioning it to formally join in 2013. Orban also mentioned frontloading talks with Serbia this year to expedite its candidacy before the end of the decade.
The plight of the Roma also leads to the larger question of Europe’s immigration crisis. Greece has now threatened to build a wall, ostensibly modeled on the one erected between the US and Mexico, at one of its most sensitive border crossings with Turkey. The EC has condemned the proposal, but one suspects it will gain traction among Europe’s nativist sectors. A UN Refugee Agency spokesman has pointed out the obvious: the real problem is not physical access but rather the lack of a EU-wide policy. Again, there are no simple solutions, but like the Roma situation, the overall immigration population begs to be tackled from Brussels.
Yet none of these initiatives will move forward until the Eurozone crisis has passed, and it is this issue that will again absorb most of Brussels’ energy. The year has begun with most eyes turned to Spain, which today took a page out of the US’s and Greece’s playbook by proclaiming China a lender of last resort. In addition, the European bonds issue remains in flux, with debate sharply divided over whether to institute the mechanism.
As my colleague Benjamin has suggested, the regional crisis might devolve into a question of German politics. As the now-undisputed economic engine of the entire continent, if spring elections reinforce Germany’s Euroindifference, the crisis will likely drag on. Brussels’ best hope is that the global economy will turn around enough and they can punt the fiscal federalism question down the road; otherwise, expect more turbulence.
