Macron Visit

EU Treaties Not Set in Stone

  • Why it matters

    Why it matters

    Angela Merkel’s support for amending the EU’s founding documents suggests she is open to the kind of fundamental overhaul of the European Union being pushed by Emmanuel Macron.

  • Facts

    Facts

    • Emmanuel Macron was inaugurated as France’s new president on Sunday and visited German Chancellor Angela Merkel on Monday to highlight the importance of the Franco-German partnership in Europe.
    • Mr. Macron has called for broad EU reform, including a common euro-zone budget and parliament for the 19-nation shared currency area.
    • Updating EU treaties is a cumbersome process but German chancellor Angela Merkel said she would support it if necessary.
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    Audio

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Antrittsbesuch des französischen Präsidenten Macron
Macron and Merkel reveled in “the magic of the beginning” in Berlin Monday. Source: Bernd von Jutrczenka/DPA.

There was more than just good personal rapport as Angela Merkel greeted Emmanuel Macron in Berlin on Monday. Permeating through the official pomp and ceremony at the Chancellery – with a crowd of pro-EU demonstrators enthusiastically waving European Union flags behind the gates – there was a pervasive sense that the meeting between the German chancellor and France’s newly-inaugurated president carried historical significance.

Under different circumstances, Ms. Merkel’s meeting with the new occupant of the Élysée Palace would have been a very routine exercise. After all, Mr. Macron is her fourth interlocutor in Paris in her 12 years in power. But Mr. Macron, a 39-year old former investment banker, is not a president like his predecessors. In Berlin’s eyes, the pro-European leader’s decisive electoral victory against his far-right opponent 10 days ago practically saved the European Union from further fragmentation.

Whether the EU can close the cracks in its foundation, rather than merely stop the bleeding, is now in the hands of these two leaders. Mr. Macron has called for sweeping reforms of the EU institutions, particularly those governing the 19-nation euro currency bloc. Ms. Merkel, breaking with her past, now suggests she is open to the idea – even if it means changing the founding treaties that dictate how the 28-nation bloc is governed.

“From Germany’s point of view it would be possible to change EU treaties, if it makes sense in order to strengthen the euro zone,” Ms. Merkel said Monday.

After a rocky year which saw Britain vote to leave the 28-nation bloc and the election of Donald Trump in the United States, the two leaders’ intention this week was to emphasize that the French-German tandem can still breathe new life into the embattled EU. At a joint press conference they gave after their one-hour private meeting Monday, there were calls for a “historic reconstruction of Europe” and “a very close collaboration” between both countries.

Now is not the time for concrete, groundbreaking policy announcements, especially since Ms. Merkel will be standing for re-election on September 24. And yet her willingness to signal that the EU’s treaties are up for discussion marked a significant shift.

Looking at EU treaties could indeed end up being necessary if the bloc agrees to discuss some of Mr. Macron’s key demand for further euro-zone integration, including a common budget of the common currency area and a dedicated euro-zone parliament. But Berlin has long been unwilling to reopen what it sees as a can of worms. Treaty changes have to be approved by all 28 EU members (27 once Britain leaves) – in some cases by  referendum. Many such votes have failed in the past including, famously, a referendum in France on whether the EU should switch to an actual written constitution.

Just last week, Germany’s influential finance minister, Wolfgang Schäuble, told Italian daily La Repubblica that Mr. Macron’s suggestions for treaty changes were unrealistic. Instead, Mr. Schäuble called for “pragmatically” strengthening the euro zone by further developing the European Stability Mechanism into a “European Monetary Fund,” along the lines of the International Monetary Fund that serves as a global lender of last resort.

However, on Monday, Ms. Merkel emphasized that “the whole world is changing.” EU treaties shouldn’t be left untouched “for our entire lifetimes” just because updating them would require lots of hard work, she said.

“Merkel wants to show good will and send a clearly supportive message.”

Claire Demesmay, political expert, German Council on Foreign Relations

Claire Demesmay, a specialist in Franco-German relations at the German Council on Foreign Relations, said she is not surprised by the chancellor’s apparent about-face. “Merkel wants to show good will and send a clearly supportive message,” she told Handelsblatt Global. “Berlin does not want to make life harder for Macron.”

For Mr. Macron, the press conference Monday was also an occasion to set the record straight when it comes to the idea of so-called euro bonds, or jointly-held debt across the currency bloc. German media have widely reported in recent days that he supports the idea, which is anathema to German policymakers and voters who fear they could end up footing the bill for spending in other EU countries. “I have never called for Euro bonds,” Mr. Macron clarified, highlighting he wanted more joint euro-zone investment programs instead.

Such clarifications are crucial to avoid any “misunderstandings that obfuscate the debate,” Ms. Demesmay said, noting the election campaigns over Europe’s future have been dominated by enough sensationalist headlines as it is. “Many people in Germany already believe that Macron is after Germany’s money,” she noted.

Still, while there may have been some clarifications and opened doors on Monday, neither leader took any earth-shattering steps. Ms. Merkel may have said she is ready to look at EU treaties to update the euro zone, but she didn’t actually promise to do so. “She merely does not rule out anything,” Ms. Demesmay noted.

For now, the chancellor’s overriding priority is to win a fourth term in September’s election. In the meantime, it will be up to Mr. Macron to deliver the economic reforms he has promised in France. If he fails to do so, there’s a chance that what Ms. Merkel called “the magic of the beginning,” quoting the German-born novelist Hermann Hesse, will wear off fast.

 

Jean-Michel Hauteville is an editor with Handelsblatt Global in Berlin. To reach the author: hauteville@handelsblatt.com.

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