by Martin Milán Csirszki
The European Council has recently published its Strategic Agenda for the years to come. The document covers the time span between 2024 and 2029.[1] This brief blog post aims to throw additional considerations as regards its content. The Agenda paints – with tough rhetoric – a quite favourable picture about the EU’s role and achievements in solving the world’s most crucial issues. After we introduce the basic tenets of the Agenda in the blog post, we concentrate on three particular issues, namely energy sovereignty, the aspiration of the EU to become a technological powerhouse and, last but not least, the agricultural sector and sustainability.
According to the Agenda, the attributes that should be the guiding principles of the EU’s development proceed in pairs with three separate themes: free and democratic, strong and secure, as well as prosperous and competitive.
What does the European Council mean by these principles?
First, a free and democratic EU means that the community is built upon the founding values, such as respect for human dignity, freedom, democracy, equality, the rule of law and respect for human rights, including minority rights. Furthermore, it means that these values should be promoted at global level. Safeguarding the rule of law is of utmost importance, which consists of, among others, building democratic resilience as well as a free and pluralistic media. Preventing foreign interferences, too, is a stated objective. Particular consideration should be given to the online space, where big tech companies shall take responsibility for safeguarding democratic debates.
Second, a strong and secure EU requires that the support for Ukraine should be maintained. In parallel, the European defence industry should be scaled up with increased spending on it. Not only the cooperation with the NATO remains crucial, but also more resources should be dedicated to combat both online and offline crime, including any illegal cross-border activities, terrorism and violent extremism. Based on the Agenda, a strong and secure EU also comes with a merit-based approach to the accession of new countries. Migration and border management are also of great importance, which, on the one hand, obliges the EU to protect its external borders, and, on the other hand, to explore the opportunities of migration through legal pathways.
Third, a prosperous and competitive EU depends upon the reinforcing of the EU’s sovereignty in strategic sectors and making it a technological and industrial powerhouse, the development of the single market, including the achievement of the Capital Markets Union and the Banking Union, as well as the maintenance of open markets at global level giving support to the World Trade Organization. The enhancement of capacities also plays a significant role in key technologies, such as semiconductors and artificial intelligence. Strategic supply chains should be diversified to create resilience. Nevertheless, the increase of competitiveness must come together with respect to the green transition and a particular focus on the latest digital innovations to prevent the lagging behind of the EU. The regulatory burdens on firms must be examined, too. Last but not least, all these advancements shall be carried out in light of the objective of upholding the social dimension of the EU, meaning that all EU citizens shall have equal opportunities to seize the forthcoming advantages. It is also important in the context of the investment into skills, training and education.
The issues, as is clear from the declarations in the Agenda, are necessarily interconnected with one another. The challenges that we must face, in parallel with retaining these characteristics, are global instability, climate crisis and digital transformation.
The Agenda is permeated with firm messages that will shape EU policies in the near future, however, the declarations sent are not fully clear. The big-tent-politics nature of the Agenda results that all who read the future priorities and the way they are formulated can conclude slightly different outcomes for certain public policies. In other words, the necessary trade-offs are not present in the text, which can bring confusion to the fore.
What is quite surprising that a kind of sovereignty rhetoric appears in several cases. The second sentence operates with the expression of ʽstrong and sovereign Europe’. As regards competitiveness, it is declared that “[w]e will reinforce our sovereignty in strategic sectors and make Europe a technological and industrial powerhouse, while promoting an open economy.” Furthermore, increasing the energy sovereignty is also an objective. In connection with the defence sector, it is articulated that we will “reduce our strategic dependencies, scale up our capacities and strengthen the European defence technological and industrial base accordingly.” Moreover, it is promised that “[w]e will strengthen our economic security, reduce harmful dependencies and diversify and secure strategic supply chains.”
It is manifest that, through political declarations like this Agenda, the EU shall deliver the message of complete unity. Nevertheless, sovereignty as such an emphasised cannonball in an EU document without elaborating, or even mentioning, Member States’ sovereignty in any context misleads the audience. It suggests that all these crucial issues are decided at (a non-existent) federal level without taking into consideration the autonomy of Member States.
For example, the area of energy is in shared competence with Member States pursuant to Article 4(2)(i) TFEU. Though the dependence of the EU and its Member States on Russian energy sources has dramatically fallen since the war in Ukraine, the picture is more nuanced. Austria still functions as important gateway to other Member States for Russian gas. It “can distribute gas to the Czech Republic, Italy and south-east Europe, and remains a vital point after Baltic Sea pipelines Nord Stream 1 and 2 have ceased to operate, and as volumes through the Yamal transit line from Russia via Poland and other Czech links from and into Germany have been falling.”[2] Albeit dependence of the EU on Russian pipeline gas has decreased, the Politico posed the question whether this dependence is changed to another one in the form of U.S. supplies of LNG.[3] 46 % of imports came from the United States in 2023. “The biggest LNG importers […] were France, Spain, the Netherlands, the UK, Italy and Türkiye.”[4] So, instead of saying that the energy sovereignty shall, and will, be increased in the EU, it stands closer to the reality that the energy sources shall be, and are about to get, diversified. Natural characteristics of the Old Continent necessarily influence and limit the possibilities that can be achieved by the EU in this regard.
Turning our attention to the technological sovereignty to be achieved in order to increase the EU’s competitiveness also comes with some additional factors that should be considered. What instantly catches the eyes of considerate readers is the goal to reduce the regulatory burden at all levels under the heading of “Promoting an innovation- and business-friendly environment”. In parallel with the declaration that businesses should be allowed to flourish, it sounds difficult to reconcile that “a modern, dynamic and consumer- friendly investment environment” is another stated goal. Not impossible, but difficult. The regulatory trends in the EU do not reflect this careful balancing at all. It is enough to think of the General Data Protection Regulation (GDPR), the Digital Markets Act (DMA) and the Artificial Intelligence Act, which stirred up the pot for big tech companies. The introduction of Meta’s AI assistant in Europe has been delayed because of the company’s necessity to comply with the burden of personal data protection rules deriving from the GDPR. The DMA’s interoperability requirements not only obstructed the European advancement of Apple’s AI agent but also of Google’s AI Overviews.[5] That is to say, from the viewpoint of big tech companies, the European regulatory landscape is anything but business-friendly.[6]
However, the necessary trade-offs should not be hidden, as the above-mentioned examples demonstrate. Of course, fair and contestable digital markets, as well as data protection are sublime principles, but it should be articulated that the latest and most innovative solutions can, in some cases, get sacrificed at the altar of these values to protect the consumers in the EU.
Furthermore, achieving the dream of a “technological powerhouse” also does not meet the reality. For example, as to the most hyped topic in the last two years, even the European Court of Auditors explicitly acknowledged that “[t]he EU has so far had little success in developing Europe’s artificial intelligence ecosystem, and has failed to accelerate AI investment on a par with global leaders.” Venture capital investments are lower in comparison with the United States and China, and it is concerning that “the overall AI investment gap between the US and the EU more than doubled between 2018 and 2020.”[7]
In sum, not only businesses but also consumers may suffer from the regulatory burden. And not only big tech companies, but also small and medium-sized undertakings. For example, in connection with the GDPR, already three years ago, GDPR’s “chief architect” Viviane Reding explicitly declared that the target of this regulation should not be small local businesses, but big tech companies. Still, the enforcement is inclined to concentrate on small market players because it is easier than to tame the giants.[8] Not to mention the finding of a recent report by the European University Institute that “[m]any of the new measures seek to ease the burden for SMEs, but SMEs that are in value chains with larger firms may nonetheless be forced to comply.”[9]
On the issue of sustainability and the agricultural sector, it is highlighted that “[t]he European Union will promote a competitive, sustainable and resilient agricultural sector that continues to ensure food security. We will champion vibrant rural communities and strengthen the position of farmers in the food supply chain. We will continue to protect nature and reverse the degradation of ecosystems, including oceans. We will strengthen water resilience across the Union.” Strengthening the position of farmers already took place in 2019 by adopting the Unfair Trading Practices Directive, which follows a minimum harmonisation approach.[10] It is either an implicit acknowledgement that this legal act has not yet delivered the expected outcomes, or there will be further protection pillars for producers in the competitive process beyond competition law. The latter is more difficult to imagine.
Sustainability has become a buzzword for the Common Agricultural Policy (CAP) recently, however, greening criteria that constitute conditionalities to receive CAP payments fail to create the breakthrough in environmental protection. Environmental NGOs, such as GreenPeace, were extremely critical of the new CAP. “The promised green reform of the EU’s common agricultural policy has amounted to nothing but greenwashing, and is a disaster for the climate, nature and small farms.”[11] Not only lobby groups but also scientists warned against the problems raised by the new CAP. A cohort of academics are of the opinion that biodiversity is failed by the latest reform process.[12] It is a frightening fact that half of the EU’s climate spending goes to the agricultural sector, but the emissions by farms have not decreased.[13] Concerning the declaration on water resilience, it is misleading and raises doubts that in early 2024, the Commission withdrew the Water Resilience Initiative from its agenda.[14]
All in all, as these three areas covered by the Agenda demonstrate, it is reasonable to look beyond political declarations and peruse the actual trends that have been taking place in the respective public policies in the last few years. The euphemisms should be overtaken by fact-based policy-making embedded in the analysis of past trends and realisable future prospects. The future of the EU will depend on policy tools that can be operationalised and administered with the ability to achieve the desired outcomes, and not on shapeless and ambiguous political messages.
[1] European Council, Strategic Agenda 2024-2029. Available at:https://www.consilium.europa.eu/media/4aldqfl2/2024_557_new-strategic-agenda.pdf.
[2] Reuters, Austria’s significance as gateway to Europe for Russian gas. Available at: https://www.reuters.com/business/energy/austrias-significance-gateway-europe-russian-gas-2024-05-23/.
[3] Gabriel Gavin, Europe’s new energy risk: Trading Russia for America. Available at: https://www.politico.eu/article/europes-risky-new-energy-reliance/.
[4] European LNG Tracker. Available at: https://ieefa.org/european-lng-tracker.
[5] Christophe Carugati, Europe Is at Risk of Lagging in AI Agents. Available at: https://www.digital-competition.com/_files/ugd/2ce5d2_1dcf64e8a036414195cde51859316b50.pdf.
[6] See more: Central European Lawyers Initiative, Digital Competitiveness of the European Union. Available at: https://ceuli.org/content/phocadownloadpap/Discussion%20Paper_Digital%20Competitiveness%20of%20the%20EU.pdf.
[7] European Court of Auditors, Special report 08/2024: EU Artificial intelligence ambition – Stronger governance and increased, more focused investment essential going forward.
[8] Vincent Manancourt, EU privacy law’s chief architect calls for its overhaul. Available at: https://www.politico.eu/article/eu-privacy-laws-chief-architect-calls-for-its-overhaul/.
[9] European University Institute, Strengthening EU digital competitiveness – Stoking the Engine, p. 75.
[10] Directive (EU) 2019/633 of the European Parliament and of the Council of 17 April 2019 on unfair trading practices in business-to-business relationships in the agricultural and food supply chain.
[11] GreenPeace, Fake green deal reached on EU farm plan. Available at: https://www.greenpeace.org/eu-unit/issues/nature-food/45751/fake-green-deal-reached-on-eu-farm-plan/.
[12] G. Pe’er et al., EU agricultural reform fails on biodiversity. Available: https://www.science.org/doi/10.1126/science.1253425.
[13] European Court of Auditors, Special report 16/2021: Common Agricultural Policy and climate – Half of EU climate spending but farm emissions are not decreasing.
[14] Nathan Canas, European Commission backtracks on Water Resilience Initiative. Available at: https://www.euractiv.com/section/energy-environment/news/european-commission-backtracks-on-water-resilience-initiative/.
