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Innovation and growth are key to economic revival in Europe

16/04/2012 Leave a comment

As we meet in London today, the European economy remains weak. Growth has stalled across the continent. Unemployment is high. After several years of crisis, our citizens and businesses are still uncertain whether the future offers prosperity or stagnation. William Hague and I outlined some ideas on how to bring growth back into the European economy and published them in The Telegraph. This is how it looks when you see it from Sofia and London…

As well as responding to the immediate debt crises, we believe that Europe must focus more on growth. We outline here a programme of reforms which Europe needs to undertake to remain competitive and confident.

Neither of our countries is in the euro, but it is in our national interest that the currency should succeed. We have a major stake in a stable and growing eurozone. A large share of our exports goes to this area and its volatility has a chilling effect on both economies.

As well as the fiscal compact, markets must be assured that the eurozone firewall is big enough; that Europe’s banks are being adequately recapitalised; and that the problems in countries like Greece have been properly dealt with.

At national level, the UK and Bulgaria are working hard to address the problem of government debt. We have put forward an aggressive set of plans to get our economies back on their feet. We are reforming our welfare and pension systems, restraining public sector pay, and streamlining our public administrations.

By taking bold decisions, we have shown it is possible to earn credibility in international markets.
Beneath the surface of the recent crises is a bigger and more important challenge for Europe. A fundamental shift in the global balance of economic power is under way – from West to East and from North to South.

This is about competitiveness. The European Commission’s 2012 Annual Growth Survey observed that “long before the current crisis, overall EU performance has been weaker than key competitors”.
The only long-term solution is to encourage and promote growth. In our meeting in London we are discussing a number of ways to do this: extending the single market, promoting free trade, reducing red tape and using the EU’s budget to promote innovation and competitiveness.

First, to complete the single market we must widen its remit to focus on the digital economy, on energy, low carbon development, defence, and further liberalisation of the services sector. One of the reasons major companies invest in Bulgaria and the UK is because they want access to the single market. But in some crucial areas, internal trade is still obstructed.

The single market has not kept up with the shift to services and changes in technology. Further liberalisation of services and the creation of a digital single market could bring over €800bn (£660bn) to the European economy.

Second, promoting free trade. The EU has had a good track record of promoting international trade but we must do more. We’d like to make 2012 the year of EU trade deals, by concluding negotiations with India, Canada and Singapore, launching negotiations with Japan by the summer, and injecting momentum into EU-US economic integration.

The deals currently on the table could add €90bn to EU GDP. Above all, we must reject the temptation to seek self-defeating protectionism in trade relations.

Third, reducing the burdens on businesses. The average cost of starting a business is higher in the EU than in our major competitors. It costs €644 to set up a business in the US compared with €2,285 in the EU. Big businesses say EU regulation is having a negative effect too.

We have made some advances in Europe on reducing regulatory burdens for small businesses. This is a step in the right direction, but we will push for a more ambitious EU programme to reduce overall burdens, specific measures to help small businesses and new sectoral targets to benefit industry.

Fourth, Europe needs to focus more on innovation and infrastructure for a modern economy. Connecting Europe’s energy grids is one milestone. In addition, we should make EU research and investment funds more flexible and simpler to use.

As President Rosen Plevneliev of Bulgaria said in his inauguration speech, innovation is at the heart of growth. Europe must create the best environment for entrepreneurs and innovators to turn their ideas into commercial projects, and thus create jobs.

Finally, we wish to stress the transformational power of EU enlargement. The process of accession has helped to entrench democracy, the rule of law and human rights across the continent. It has also increased investor confidence. We believe membership of the EU should be open to any European country that wants to join and meets the rigorous accession criteria.

Seven Steps to Boost the Arab Awakening

01/04/2012 Leave a comment

When a Tunisian fruit vendor set himself on fire in a small town’s public square, barely anyone expected this act to lead to a revolution in Tunisia, Egypt, Libya, and the Arab world. The fall of the three dictatorships initiated a new phase in a worldwide democratic wave that has been remaking the world since 1989.

Commentators of the “Arab Awakening” are tempted to draw a parallel between recent events in the Middle East and Northern Africa and those in Central and Eastern Europe of twenty years ago. The integration of the latter to two of the most democratically recognized international organizations–NATO and the EU–have led Western decision makers to believe they know the “recipe” for successful transition. However, the mechanic “copy-paste” of ideas and solutions should be approached with caution.

Back in 1990, the European Union responded to the young democracies by opening up and offering the prospect of membership to all who came in from the cold. This was the driving force for changes in Central and Eastern Europe over the next 20 years. Back then this happened because of visionary European leaders.

For many reasons, mainly immigration waves and the rise of xenophobic parties, the international community lacks the magnitude of such vision today. The danger of falling in weightlessness is real. The countries in transition need visionary leaders to be inspired to continue with the changes to achieve prosperity.

Seven crucial steps can assist in reaching this.

First, there should be a close association with the European Union. The EU should provide enhanced association status of all countries that subscribe to its values, linking this to easier movement of goods (tough but not impossible), institution building and extended cooperation between universities/students. This will create an attractive package for the ever-growing young Arab constituency.

Second, Central and Eastern Europe has much to offer. It has learnt the lessons of transition, of do’s and don’ts, of moving from dictatorship to democracy. How to deal with transitional justice? How to handle constitutional reform? What comes first – political or economic reform? How to fight corruption? How to establish civilian control over the armed forces? This resource should not be wasted.

Third, Arab countries should remind themselves of their common roots, rather than pointing out differences. Europe is a great example of integration. The Arab world should likewise kick start the process of an Arab-League-that-turns-to-Arab-Union. That would certainly be bold, but is worth exploring. Surely such a Union should be based on an integrated market, but also on shared values of a representative democracy and human rights.

Fourth, the role of European political leaders has to be reconsidered. They should reach out to religious parties in the region and not cringe from them. Yes, these groups are all very different. It is nevertheless important to be engaged and to work with those who are more moderate.
Fifth, the EU should finally set up a “European Endowment for Democracy”. The project can work at arms-length from governments and help build both sustainable political parties and civil society across democratically aspiring Middle Eastern countries.

Sixth, the Council of Europe should have a proactive approach vis-à-vis these countries. It should not only sign agreements, but should instead offer a form of membership to those countries in the Middle East and North Africa, willing to subscribe to the common values of the Council of Europe. The organization has high legal standards and criteria, offering protection of human rights, minorities, and media freedom. The countries that join the Council are to provide the same set of rights to their citizens.

Seventh, NATO can have an important role by sharing its experience in developing civilian security and defense expertise. Arab countries coming out of dictatorships lack such experts and knowledge. In the long run if they don’t work on civil-military relations and civilian control over the armed forces, they are in for many problems. And so are we.
It is in our collective interest to be out there driving the debate and putting the assistance programs together today, not when it is too late.

As published by the Atlantic Council

Nickolay E. Mladenov is the Minister of Foreign Affairs of the Republic of Bulgaria.
Hristiana Grozdanova is a member of the Atlantic Council’s Young Atlanticist Working Group.

Седем стъпки в помощ на младите арабски демокрации

01/04/2012 Leave a comment

Текстът е публикуван в сайта на Атлантическия съвет и econ.bg

Когато тунизийски продавач на плодове се подпали на площада в един малък град, едва ли някой очакваше това да доведе до революция в Тунис, Египет, Либия и целия Арабски свят. С падането на трите диктатури започна нова фаза в световната демократична вълна, която прекроява света от 1989 г. насам.

Коментаторите на “арабското пробуждане” се изкушават да направят паралел между последните събития в Близкия изток и Северна Африка с тези в Централна и Източна Европа (ЦИЕ) отпреди двадесет години. Интеграцията на страните от ЦИЕ в НАТО и Европейския съюз (ЕС) накара западните политици да повярват, че знаят “рецептата” за успешен преход. Към механичното “копи-пейст”-ване на идеи и решения обаче трябва да се подхожда с повишено внимание.

Още през 1990 г. Европейският съюз отговори на младите демокрации, като се “отвори” към тях и им предложи перспектива за членство.Това бе движещата сила за промените в Централна и Източна Европа през последвалите 20 години. Тогава това се случи заради европейските лидери, които бяха визионери, утописти, мечтатели.

По много причини, главно заради имиграционните вълни и възхода на ксенофобските партии, международната общност вече не разполага с тази визия. Опасността от изпадане в безтегловност е реална. Страните в преход имат нужда от лидери, за да бъдат вдъхновени да промените, които да им донесат просперитет.

Седем важни стъпки могат да помогнат това да се случи.

Първо, трябва да има тясно сътрудничество с Европейския съюз. ЕС трябва да осигури статут на асоциирани членки на всички страни, които които споделят неговите ценности. Това може да се свърже лесно с движението на стоки, институционалното изграждане и разширяване на сътрудничеството между университетите и студентите.

Второ, страните от Централна и Източна Европа могат да предложат много опит. Тези страни са научили уроците на прехода, на това, което трябва, и това, което не трябва да се прави, на преминаването от диктатура към демокрация. Как да се справят страните с правосъдието по време на прехода? Как да се справят с конституционната реформа? Кое е първостепенно – политическата или икономическата реформа? Как да се борят с корупцията? Как да се установи граждански контрол над въоръжените сили? Този ресурс не трябва да се губи.

Трето, арабските страни трябва да припомнят общите си корени, вместо да изтъкват разликите по между си. Европа е един чудесен пример за интеграция. По същия начин и арабският свят трябва да започне процесът по превръщане на Арабската лига в Арабски съюз Това със сигурност би било смела и дръзка постъпка, но си заслужава да се проучат възможностите за предприемането й. Със сигурност такъв съюз трябва да се основава на интегрирания пазар, но също така и на споделените ценности на представителната демокрация и на човешките права.

Четвърто, трябва да се преразгледа ролята на европейските политически лидери. Те трябва да достигнат до религиозните партии в региона и да не бягат от тях. Да, тези групи са много различни. Въпреки това е важно да бъдат ангажирани и да работят с тези, които са по-умерени.

Пето, ЕС трябва най-накрая да създаде “Европейска фондация за демокрация”. Проектът може да работи при равнопоставеност на правителствата и да подпомогне изграждането както на устойчиви политически партии, така и на гражданско общество сред страните от Близкия Изток, които се стремят към демокрация.

Шесто, Съветът на Европа трябва да има проактивен подход по отношение на тези страни. Съветът трябва не само да подписва споразумения, но да предложи форма на членство на тези страни в Близкия Изток и Северна Африка, желаещи да се присъединят към общите ценности на Съвета на Европа. Организацията има високи правни стандарти и критерии, като предлага защита на човешките права, малцинствата и свободата на медиите. Страните, които се присъединят към Съвета, ще трябва да предоставят същия набор от права и на своите граждани.

Седмо, НАТО може да има важна роля, като споделя опита си в развитието на гражданската сигурност и отбраната. Арабските страни, преминаващи от диктатура към демокрация, не разполагат с такива експерти и знания. В дългосрочен план, ако те не работят за развитието на гражданско-военните отношения и гражданския контрол върху въоръжените сили, то тези страни ще имат сериозни проблеми. Както и ние.

От наш взаимен интерес е да стимулираме дебата и въвеждането на програми за подпомагане на тези страни днес, а не когато вече ще бъде късно.

Статия на Николай Младенов, външен министър на Република България, и Християна Грозданова, член на Младежката атлантическа работна група към Аталантическия съвет.