EU excluded from upcoming security talks with Russia on Ukraine

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France is now at the helm of the rotating EU presidency and its ambition for a more autonomous European security and defense policy is put to the test in a flurry of meetings with Russia on Ukraine, where Washington (and to some extent Paris and Berlin) overshadows the EU’s own diplomatic service. We will unpack the arguments put forward by EU foreign policy chief Josep Borrell so that the bloc is not excluded from the upcoming NATO-Russia negotiations.

Meanwhile, on the pandemic Front, the French government is expanding its aid to companies struggling with the new wave of restrictions imposed to stop the spread of the Omicron variant. The government’s inaction three months before the presidential election would have been easily grasped by opponents, who are already critical of the latest restrictions on large gatherings.

And in costs Brexit statistics, we’ll see why Europe is importing less and less food from the UK, while Britain continues to import European wine.

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No place at the table

What a difference half a year makes. Last June, Brussels was appalled by a Franco-German proposal for the EU to sit down with Russian President Vladimir Putin. Now Brussels is outraged at being snubbed in favor of the United States and NATO, and has asked for the opportunity to speak with the Kremlin next week on Ukraine, writes Henry Foy in Brussels.

Josep Borrell, head of the EU’s foreign and security branch, who has personal experience of being dismissed as a geopolitical light weight by Moscow, said the EU “cannot be a neutral spectator ”when European security is discussed. The Kremlin would not agree.

As many European officials privately admit to Europe Express, the bloc needs only to blame itself for not being seen as a worthy defense and security partner, given it is torn apart by disagreements and divisions in precisely these areas.

Concrete example: the EU-NATO declaration. With 21 member countries of the two organizations, agreeing on a largely symbolic declaration of cooperation that effectively reinstated those made in 2016 and 2018 was supposed to be a straightforward task.

But despite a majority of member states calling on EU Council President Charles Michel to do swift work on a draft NATO submitted in September, it has been postponed until this year.

This, by accident or – more likely – on purpose, leads to the debate on its content under the French presidency of the EU, and the conviction of the Elysee that the EU needs more “strategic autonomy” and defense capabilities independent of the US-led military alliance.

Speaking of France, as Borrell calls for a united EU voice to speak with Russia, Paris and Berlin instead send envoys to speak to Moscow privately. This will appeal to the Kremlin, who, of course, prefers to talk to individual countries anyway because it’s easier to determine where their geopolitical and business interests align.

Eastern EU states, which are members of NATO precisely because they fear Russia and fear their Western colleagues will indulge in Moscow, will be spending their time with the Russians next Wednesday, when the Moscow delegation will sit for a summit with the alliance.

But the Russians will come to Brussels for NATO headquarters, not EU headquarters. Despite Borrell’s grief, the EU will have to come to terms with its role as a neutral spectator – and the readings of the meetings after they conclude.

Despite all the dreams of “strategic autonomy” and Michel’s proclamation that 2022 will be “the year of defense Europe”, when Moscow needs to talk about power politics, he knows who to turn to.

French aid, continued

France is extending new financial assistance to small businesses struggling due to new sanitary measures and easing repayment terms for state-guaranteed loans as it tries to keep an economic recovery on track despite a increase in Covid-19 infections, writes Sarah White in Paris.

Like many European peers, France has avoided massive defaults throughout the pandemic and has protected businesses such as restaurants that have had to close for months with a massive aid package that includes time off programs. , government guaranteed loans, and help with social bills and rental costs.

As a fifth wave of Covid resumes, with a spike in infections led by the highly transmissible variant of Omicron, France has so far avoided any form of complete lockdown and is banking on an intensified campaign of booster vaccination.

But new restrictions, including a ban on events of more than 2,000 people, are expected to hit the entertainment industry. Nightclubs are closed and bars and restaurants may struggle as people are urged to return to work from home and reduce socialization.

Economy Minister Bruno Le Maire said companies under pressure in sectors such as tourism or hospitality could ask for help to cover their fixed costs if their revenues were halved in January. The government will also allow some companies to renegotiate their state-guaranteed loans; those expected to start repaying them from March may request a six-month delay.

“We are not reactivating the ‘whatever it takes’ mode,” Le Maire told RTL radio yesterday, referring to the broader aid plans put in place in 2020.

Some 25,000 to 30,000 small businesses out of a total of nearly 700,000 that have taken out state-guaranteed loans through their banks may find it difficult to be repaid immediately, Le Maire said.

The French banking federation said the financial sector was in talks with the government on how to articulate loan extensions, which it said could be considered on a case-by-case basis for struggling businesses. He said more than half of the companies that took out state-guaranteed loans had already started paying them back.

Chart of the day: fallout from inflation

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Poland’s annual inflation reached 7.8 percent in November, the highest level in two decades and the fourth highest in the EU. This development poses a problem for the ruling Law and Justice Party (PiS), which has so far remained popular thanks in large part to its success in improving the lot of the less well-off Poles. (More here)

British exports decline

Agri-food imports from the UK to the EU fell by almost € 3 billion, or 27%, in the first nine months of 2021 compared to the previous year, following the entry into force of new post-Brexit trade rules, according to data from the European Commission.

The drop in trade came even as EU exports to the UK edged up 0.5%, with particularly strong increases for wine and live animals, writes Judith Evans in London.

The drop in imports came after the entry into force of new post-Brexit regulations from January 2021, imposing new veterinary and customs checks on goods sent from the UK to the EU, even as the UK United has delayed full implementation of new rules on goods traveling the other way. management until 2022.

The drop was particularly marked for tropical fruits, nuts and spices, whose imports fell 88%, or € 217 million – a drop which, according to Dominic Goudie, head of international trade at Food and Drink Federation of the United Kingdom, likely reflects new rules of origin. . These impose tariffs on imports to the EU when food comes from elsewhere and has not been significantly processed in the UK.

This change has prompted some multinationals to reorganize their sourcing, he said.

“Some companies have reoriented their supply chains – if they supply their own factories or customers in the EU, they will trade directly in the EU instead of going through the UK,” Goudie said.

Wine, pet food, vegetables and confectionery are other areas where trade has declined sharply.

Trade has rebounded somewhat from the early months of 2021, when some companies stocked ahead of the new Brexit rules, and others – especially those importing and exporting animal products – suffered from delays and paperwork errors at the border. But imports from the UK in September 2021 were still 25% lower than a year earlier, the commission said.

Goudie said data for the last quarter of 2021 would help show whether UK exporters will make up some of the lost ground. New sanitary and phytosanitary requirements on agri-food products transferred from the EU to the UK from July will present a new challenge for EU exporters, he added.

What to watch today

  1. EU foreign policy chief Josep Borrell is in Ukraine for a three-day visit

  2. German Foreign Minister Annalena Baerbock visits Washington to discuss Russian-Ukrainian relations

. . . and later this week

  1. French President Emmanuel Macron receives the College of European Commissioners in Paris on Thursday

  2. NATO foreign ministers discuss Ukraine on Friday

Notable, quotable

  • Omicron effect: European tourism and airline stocks rose sharply yesterday, with investors betting that the Omicron variant of the coronavirus will disrupt travel less than initially feared.

  • Italian elections: Italy’s parliament will meet on January 24 to start voting for the country’s next president, with Prime Minister Mario Draghi having indicated he is ready to be appointed. His potential resignation as prime minister could trigger an election and risk delaying structural reforms and EU stimulus fund investments in the event of a pandemic.

  • Lithuania rear: Lithuania’s decision to allow Taiwan to open a de facto embassy in its own name was a mistake, the country’s president said yesterday, as he berated the government for a move that sparked a diplomatic row with China .

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Today’s Europe Express team: [email protected], [email protected], [email protected], [email protected]. Follow us on twitter: @henryjfoy, @SarahWhites, @JudithREvans, @valentinapop.

Christi C. Elwood