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Main issues facing the EU after elections

15 May 2014, 11:54 CET
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(BRUSSELS) - Near record unemployment and a very modest economic recovery, a massive trade pact with the United States, plus the Ukraine crisis and other foreign policy challenges are all key issues facing the European Union in the next five years.

UNEMPLOYMENT, DEBT CRISIS COSTS

Generating jobs at a time when 26 million people are out of work across the EU is the single most important issue running through the current election campaign. Youth unemployment is above 50 percent in some countries such as Spain and Greece, sparking talk of a 'lost generation' who will never get established in full-time work.

While social policy is still largely the reserve of the 28 EU member states, the European Commission has championed a youth employment initiative to give some help by committing billions to the task.

On the campaign trail, all the candidates preach the same message on jobs -- yes, austerity is needed to stabilise the public finances but there has to be enough leeway left to help those worst affected by the slump and debt crisis.

Against this backdrop, the idea of an EU minimum wage has steadily gained ground after German Chancellor Angela Merkel was converted to the cause in order to finalise her coalition government with the Socialists. The issue remains divisive, with business complaining it puts them at a disadvantage against overseas competitors and ultimately costs jobs. Balancing these priorities will occupy the new EU leadership for years to come.

US TRADE PACT, OPPORTUNITY OR RISK?

The Transatlantic Trade and Investment Partnership (TTIP) is championed by outgoing European Commission head Jose Manuel Barroso and other EU officials as offering huge economic gains at relatively little cost.

Together, the United States and EU would account for about 40 percent of global economic output and 50 percent of global trade. Since the two are already major trading partners, its backers say the changes needed to end tariffs and open up markets are modest in comparison with other free trade agreements.

For opponents, TTIP is a monster, the unacceptable face of globalisation leading to the loss of national and regional identities. The fear is that US companies will be allowed to breach the EU's defences, bringing in US food tainted with preservatives or Genetically Modified Organisms into EU markets.

Another concern is that US companies may win the right to challenge EU government policy in court under Investor-to-State Dispute Settlement provisions.

The scandal of US intelligence snooping on EU political leaders in 2013 nearly derailed the talks amid public outrage and the end-2015 deadline looks increasingly ambitious. EU officials say the negotiations are still largely technical and a long way from the time when political decisions will be needed to seal an accord.

CLIMATE CHANGE, ENERGY POLICY

The Ukraine crisis and Russia's using as leverage gas supplies to and via that country onwards to Europe have focused EU minds on the need to diversify energy sources.

The US 'shale gas revolution' meanwhile is giving US companies increasingly cheap energy costs to the disadvantage of their European competitors. They want shale gas opened up in Europe but face vociferous opposition from environmentalists.

Britain meanwhile has taken the nuclear option for its future energy needs but the huge cost and environmental issues raise serious questions. The Fukushima disaster in Japan saw Germany decide to quit nuclear energy and focus on renewables but they require huge and very unpopular subsidies.

The EU is also under intense pressure to stick to ambitious greenhouse gas reduction targets as part of efforts to combat global warming. However, at a time when economic growth and jobs are at a premium, environmental concerns get pushed down the agenda.

FOREIGN AFFAIRS

Lulled by the relative quiet which followed the end of the Cold War, the EU now finds itself facing a Ukraine crisis reminiscent of the very worst East-West stand-offs. How to deal with an intractable Russia amid suspicions it no longer accepts Europe's post-Cold War borders?

The potential threat to the status quo is a policy nightmare for an EU which has trouble formulating a common external policy on matters of much lesser import. As officials say, there is no military option available or conceivable, meaning sanctions have to be the means to persuade Moscow to reverse course in Ukraine, where it has annexed Crimea. EU member states are inevitably divided on how far those sanctions can go.

The EU has put time and effort into supporting the Middle East peace process but despite the efforts of US Secretary of State John Kerry, the talks seem to have run into the sand. That makes life much more difficult in the Middle East as a whole where the EU has backed the wind of change which ousted long-time leaders in North Africa but the bloc is now struggling to find a modus vivendi with their replacements, especially in Egypt.

The Syrian conflict continues to add to the pressures while Brussels tries to get a fix on the underlying forces of rapid population growth and economic dislocation bringing such rapid change to the region.

ENLARGEMENT

After welcoming the former Soviet states of eastern Europe into the fold to give it 28 members, EU enlargement appears largely on hold. Serbia has begun accession talks but it is unlikely they could be completed in the next five years.

The most important candidate Turkey seems stuck in an impasse with the EU, complicated further by its own domestic political tensions.

Regarding opposition to enlargement, some see a risk of break-up or change to the EU's role and powers from growing eurosceptic sentiment in many member states.

Scotland's independence vote in September -- and a possible similar referendum in Catalonia -- will be a real test of the EU's resilience. There are very sharp divisions over how the EU should respond to an independent Scotland seeking membership in its own right.


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