What kind of a Union for Small States?

By Esko Antola

The strategies of the small member states of the European Union are often characterised by a preference for strong and effective institutions in order to defend their interests in the framework of more powerful and often dominant powers. If they want to enjoy the benefits that strong institutions provide they have to be ready to accept the power of such institutions even if this means surrendering aspects of their own sovereignty. In most cases they have accepted the latter in order to achieve the support of strong institutions against the dominance, perceived or real, of large member states.

Institutions offer a reliable forum where small states can gain information on the actions and preferences of other states — large and small. Institutions also give small countries an opportunity to influence the compliance of powerful states to joint decisions and rules while emphasising their own input in common projects. They believe that states will adhere to international treaties monitored and executed by institutions more effectively than in cases when there are treaties without institutions. In this latter case relative differences in size and power assume greater importance.

Small states do not constitute a coherent group of members in the European Union. Size as such is not the decisive factor in the member states’ coalitions in decision-making situations. Other cleavages like the North–South divide, intergovernmental-federal split or political divisions between the ruling governments are of much greater importance. A divide between euro-sceptical governments and more pro-integrationist governments is also more prominent than the one between large and small members.

The weight of small states in the EU decision-making process rests on their great number. Out of 15 member states 10 are usually classified as small member states. Their number could double as a consequence of the future enlargement. The number of small states is a significant factor, particularly in decisions requiring unanimity. All member states, large and small, have an equal opportunity to use their right to veto. Thus the small states have an opportunity to prevent large states from using the Union for pursuing their national interest or interests common only to the large states. Equal treatment and equal rights are fundamental principles, which culminate in representation, even if such representation is relative. Representation in institutions and decision-making is a combination of the principles of territorial representation and the relative size of populations.

Small members' strategic choices

Small member states of the European Union have different views about the 'finalité' of integration and their strategic choices vary accordingly. They are divided into three groups. At one extreme are 'euro-sceptical' Sweden and Denmark. They support an inter-governmental Union anticipating that the interests of small Members are observed in the best way at negotiation tables between the Governments. They appreciate national sovereignty and the value of veto in defending their vital interest. Sweden and Denmark are in their overall strategy "reluctant" Europeans. They tend to be issue-specific in their approach.

At the other extreme are Belgium, Luxembourg, Portugal and Finland. They are inclined to see the finalité in terms of strong institutions and through a communitarian approach. They are ready to outline a new division of labour between the institutions and the member states, in a federalist spirit. They see that supranational institutions secure the influence of small states better than purely inter-governmental structures. Formal structures and rules benefit small states since all Members have to follow them irrespective of their size and power. Instead of being issue-specific these countries are institution specific in their approach.

Other small member states are less precise in their approach. They are issue-specific in a sense that they have certain key interests and important issues to look after. Ireland has had a very clear focus on structural policies and neutrality. The Netherlands, a member of the traditional Benelux group, has recently distanced herself from the group of institutionalists. As a major net contributor, together with Germany, she has a key interest in not expanding the expenditure of the common budget. The Treaty of Nice distanced the Netherlands from Belgium also in terms of voting power. The identity of the Netherlands is somewhat dubious. She is not quite a small member but has not a recognition as a middle power. Greece has special interests in budgetary matters and in particular in external relations. Austria is still in the process of establishing her policy and the pressures from domestic considerations and enlargement.

Dividing lines

In the recent debate of statesmen the divide is clearly identified. Prime Minister Göran Persson of Sweden is clearly on inter-governmentalist lines and associates himself with Prime Minister Tony Blair. Paavo Lipponen of Finland and Guy Verhofstadt of Belgium are close to the argumentation and visions of German leaders but emphasise a small state view.

An illustrative quotation comes from the Finnish Prime Minister Lipponen in his speech to the European University Institute in Florence in April 2001:

"Whatever changes we are debating to the current system, I would stress that Finland considers strong community institutions as crucial for the functioning of the Union. Equality between the member states should be safeguarded. I would not like to see a rolling back of integration and our common policies."

The Treaty of Nice contributes to an apparent decrease in the relative power of small states. This is seen both in the number of votes in the Council and in the distribution of the seats in the Parliament. On the other hand, the number of small states within the Union has increased with recent enlargements and this trend will be reinforced in future. The question therefore remains as to whether these states will be able to exploit the potential that they have through their great number.

More than power relationships, as seen in the number of votes in the Council of Ministers, the founding principles of equality between the member states are at stake. Equal participation is a fundamental element in the equality between the member states. Thus preserving the equality principle is a common interest to all small states independently from their approach to the finalité. The key issues are the rotating presidency, the definition of official languages and the equality of European citizens in European institutions.

The rotating presidency in particular is of a high value for small states. Holding the presidency helps them to maintain a visible and high profile not only in the every-day practice of the work of the EU, internationally but also domestically. In running the presidency small member states may perform functions that are associated with the role of small powers in international relations in general. They perform functions of 'honest-broker' and procedural leadership. And quite often, they seem to be more able than large member states to run the task of the Presidency.

Language regime

The language regime is another issue of concern. It is of special importance for those small states whose domestic regime consists of a less-spoken language. The bottom lines are to maintain the regime that gives each citizen the right to approach any of the Union institutions or bodies in any one of the Treaty languages and that official documents are provided in official languages also in the future. The ongoing enlargement process will further complicate the language regime. In particular the interpretation services will be under a heavy pressure.

The principle of equal participation is associated with fundamental issues related to the future of the European Union. It is linked to democratic legitimacy and the equal rights of EU citizens. In particular, if people in the small countries perceive any continuing reduction in the status of their states within the Union, they are likely to become more alienated from the European institutions. The result of the Irish referendum on the Treaty of Nice is an alarming example of the consequences.

The 'Post-Nice' agenda for the European Union brings to the surface new challenges. The Declaration attached to Nice Conclusions consists in itself of four items: simplification of the treaties, the future status of the Charter of Fundamental Rights, the division of powers between the European Union institutions and the member states and the role of national parliaments in the decision-making structure. The post-Nice agenda is fundamentally different from the power-related agenda of the Nice process. The preparatory process of the agenda is made open for inputs from national Parliaments, European Parliament and different sections of the civil society. This provides a framework where arguments rather than prestige or voting power will be of pivotal importance.

Problems of equal treatment

Parallel with the post-Nice process the Union must work to meet the challenge of the Helsinki Headline Goals in developing its defence policy capacity. This debate is probably going to be dominated by larger members and will put the smaller members on a defensive stand. The nature of defence policy integration favours power-related arguments and involves also a strong element of prestige. The debate is likely to be dominated by larger member states whose contribution to the common defence policy is bound to be more extensive than that of smaller members. Obviously member states with neutral past have their particular challenges involved.

The third challenge, the management of Euro and the EMU, also poses challenges to small member states. Arguments that bigger economies should have more to say in the management of the European Central Bank system have been echoed. The main argument is that of effectiveness. In particular the composition of the Governing Council, now including Central Bank directors from all EMU-countries, is seen as a possible obstacle for effective decision-making. As the Irish case suggests, small member states may find themselves under a surveillance that is not easily extended to larger members. This highlights the problems of equal treatment.

The eEurope concept and the outlines for economic policy coordination highlight the strength of many smaller nations. Scandinavian countries in particular are forerunners in such key sectors of eEurope as internet connections and mobile technology thus providing benchmarks for the rest of the EU and for bigger members as well. Many of the small member states may assume a leadership role in these key sectors. An obvious niche role is open for smaller member states.

The fourth process, the improving of the governance of the European Union, is an issue of reforms where the smaller member states are potentially key contributors. Many of them emphasise the improvement of institutional effectiveness of the Union as their main aim. Prestige and power, on the other hand, are less visible in governance than in sectors where power relations are directly involved.   

The Governance debate will bring to the surface the future of the institutional balance. Traditionally small member states have valued highly the Commission as a 'friend of small'. During recent years, however, they have seen a decline of the power and prestige of the institution on which they have invested confidence. The trend of increasing inter-governmentalism shifted the institutional balance in favour of the Council, in particular the European Council.

Esko Antola is Jean Monnet Professor and the Director of the Jean Monnet Centre of Excellence at the University of Turku, Finland. He is currently engaged in a research programme on Small States and the Future of Europe. www.utu.fi/jean-monnet


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