Macron's growing influence in the EU puts the bloc at risk: Report

By Al Mayadeen English
Source: The Telegraph
4 Sep 2023 16:27

France's rise to power in the EU will enable it to steer the bloc's trade policies toward a more protectionist ones.

France's President Emmanuel Macron addresses a plenary session at the European Parliament in Strasbourg, on January 19, 2022. (AFP)

France's historical affinity for trade barriers dates back over a century, from tariffs in 1892, to more recent instances of trade protectionism.

While France's international trade policy now falls under the European Union (EU), President Emmanuel Macron has used this platform to pursue protectionist policies on a larger scale, The Telegraph said in a report published on Monday.

The European Union provided Paris with a bigger platform to practice its international trade policy. However, instead of diluting the protectionist tendencies, the French president made use of the expanded reach provided by the EU to further double down on these policies.

Paris today, rather than championing France first, is hyping a Europe-first policy, and Macron wants to take the lead to drive this transformation.

“The main source for EU protectionism is the Elysee Palace in Paris and Emmanuel Macron who represents a very Gaullist type of idea of political control over the economy,” says Fredrik Erixon, director of the Brussel-based European Centre for International Political Economy (ECIPE).

In the early 2010s, France and the UK played a counterbalance role to Germany's power dominance over the EU. Berlin then was an advocate for open trade, given its strong international business relations, especially with China. Paris on the other hand, clung to its protectionism to maintain its local sectors and industries.

However, with Brexit and Germany's weakened economy, France has seized an opportunity to influence EU policies in its favor. Macron's vision includes a sovereign and independent Europe with a larger EU budget, a complete banking union, and even a European army.

The French president first presented this strategic concept during a speech delivered in 2017 at the Sorbonne University in Paris. But he knows that many would not like the idea of a more powerful bloc.

“Some will tell you it’s not the right moment. But it’s never the right moment,” he told the audience.

Recent examples of Macron's growing influence include his intervention to prevent the appointment of American economist Fiona Scott-Morton at the European Commission, and his role in paving the way for the appointment of Ursula Von der Leyen as the EU chief.

“What it says about Europe is that Macron was able to influence that kind of position, which shows his and France’s influence in the Commission," said Alexandre de Streel, a former Belgian diplomat and professor of European law at the University of Namur in Brussels, commenting on the incident.

Von der Leyen's agenda mirrors Macron's vision, emphasizing collective action and industrial subsidies.

“It’s almost as if she plagiarised parts of [Macron’s speech],” de Streel added.

Berlin's role in decline

France, along with Germany, has provided the majority of the subsidies distributed by the EU at 80%, totaling over €650 billion since 2022. Protectionism has gained momentum globally, and France has capitalized on this trend to advance its agenda.

Germany, in its earnest efforts to bolster its industrial foundation and economy, has emerged as the largest recipient, garnering over half of the subsidies disbursed.

The growing influence of Paris in the EU, combined with the decline of Germany's, and the absence of the UK, has created a Franco-German duopoly in EU decision-making. However, maintaining a balance of power between France and Germany is crucial for the EU's future.

“In the gap left by the UK, some had speculated that other non-euro members would step up with more clout advocating the UK’s less interventionist path," said a former European diplomat.

“That did not happen, in my opinion. The Danes, Swedes and Poles did not fill that role. Instead, the German-French duopoly became more prominent. The French and Germans almost always discuss all EU issues amongst themselves before they come to the broader EU venues and they try hard to get on the same page," the politician added.

“This gives them more power now than before Brexit because there isn’t a counterweight in the UK.”

But Berlin's role in the relationship has declined in recent years as its attention now is directed inward.

Smaller countries unwilling to stand up to France

Government-backed capital injection into local industries, such as US President Joe Biden's Inflation Reduction Act (IRA) and Chinese President Xi Jinping’s Made in China 2025, are attempts to shape a future founded on sovereignty and security.

According to the International Monetary Fund (IMF), global trade restrictions have "exploded" in the past five years, as more countries are shifting toward a more protectionist policy.

However, small countries seem to be unwilling to stand up to France, the report said.

De Streel suggests that maintaining a power balance in Brussels is the key to the EU’s future.

The EU should not prioritize power and influence over economic growth, as protectionist policies may hinder prosperity, de Streel suggested.

“I think Europe can only work if [France and Germany] are equally strong and equally influential in the political decision-making because they reflect two different cultures," he added.

Erixon, on the other hand, considers that struggle over power rather than economic growth has become a main source of distraction to the continent. Europe must focus on the risk aspects of protectionism rather than trying to rival the US.

“There is nowhere through history where any country regulated their way to economic success. That’s not a way to create more prosperity.”

Macron's increasing influence underscores the need for EU leaders to consider these implications carefully, Erixon concluded.