Trouble at home reduces EU heavyweight

MUCH of the political fallout from the Amsterdam summit flows from this paradox, phrased by a senior EU diplomat there.

MUCH of the political fallout from the Amsterdam summit flows from this paradox, phrased by a senior EU diplomat there.

The summit witnessed a realignment between Germany, France and Britain which could be full of significance for economic and monetary union. The project survives the summit and is now much more central to driving the EU forward, after postponement of immediate preparations for EU enlargement and a watering down of ambitious plans for European security and defence.

Anyone who witnessed, the shock with which Dr Kohl's insistence on a unanimous changeover to majority voting on asylum, visa and immigration policy in five years' time was received at the summit understands the paradox better.

The impression was reinforced when his chief foreign policy adviser went on to announce just before midnight on Tuesday that the Chancellor had blocked the extension of majority voting to five other important areas, leaving only research and development unaffected.

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Those who expected Dr Kohl to continue his role as the primary driving force for further integration, fulfilling the political union promised at the time of the Maastricht Treaty, were sorely disappointed. His growing weakness at home has indeed been masked by his continuing strength in the European arena, whose agenda he has dominated.

He was heavily and unusually under instruction from home, especially from Land* governments not prepared to pay the assumed costs involved. Had he been stronger he could have overridden them, as he has previously been prepared and able to do. But that would have endangered ratification of the treaty in the Bundesrat, where Land governments dominated by opposition parties are in the ascendant.

He was therefore willing to antagonise his European partners, secure in the knowledge that the new flexibility provisions agreed in the treaty would be an alternative means of proceeding in future if needs be.

Dr Kohl is now determined to put EMU at the centre of his election campaign next year, in the hope that it will galvanise his authority and stature and widen a split in the opposition Social Democrats between Mr Oskar Lafontaine, who supports the EMU timetable, and Mr Gerhard Schroder, who opposes it.

But it may be dangerous for him to make such assumptions. Influential German journalists covering Amsterdam did not expect Dr Kohl to survive in office. The same political fatigue is there as was apparent after 18 years of Conservative rule in Britain. They find the paradox more and more acute: how can he will the European end without agreeing the domestic German means to enable it to happen?

If, as is so often - and correctly - averred, EMU is politically driven, how then does it look in the light of these events? There is still a profound German interest in seeing it succeed; the consequences of it not doing so would be much worse from Germany's point of view. Even though most Germans are against the project when polled, their opposition is relatively thin and capable of being turned; most expect it to proceed on time. Among the German political and economic elite, support for EMU is qualitatively stronger at over 80 per cent in favour.

But the government's room for manoeuvre is increasingly constrained by inter-party argument over strict interpretation of the convergence criteria, notably between the Minister for Finance, Mr Theo Waigel, and his party colleague, the Bavarian premier, Mr Gerhard Stoiber.

This will make it more difficult for Dr Kohl to make the kinds of political compromise necessary to accommodate the new French government, whose demands that employment and growth be prioritised were one of the main issues in Amsterdam. The compromise reached had more for Germany than for France, in that the Stability and Growth Pact agreed in Dublin was legally endorsed.

But concealed within the terms of a second resolution on employment and growth is an emergent discussion about macroeconomic co-ordination in Europe that could set a new agenda, reflecting more social democratic values.

British participants in the Amsterdam summit were keen to make the point that their emphasis on flexible labour markets had helped to bridge the policy gap on EMU between Paris and Bonn. They will continue to pursue it over coming months through the Group of Seven plus Russia and then in their EU presidency from January, during which they will chair the crucial decisions on who is in and out of the new currency.

The British would need to resist two temptations: making too much of a conviction that EMU is misconceived, which would open up renewed Franco-German suspicions that they wish to sabotage it, or seeking to exploit Franco-German differences in an old balance-of-power manner. That would reinforce the dangers if the EMU project fails, should Dr Kohl prove incapable of delivering it politically.

Paul Gillespie

Paul Gillespie

Dr Paul Gillespie is a columnist with and former foreign-policy editor of The Irish Times