Sikorski Puts Cameron on the Spot
BRUSSELS -- Radoslaw Sikorski’s Berlin speech shattered any illusion in London that British Prime Minister David Cameron could rally the 10 eurozone “outs” to British positions at the European Union summit on December 9. Sikorski’s federalist vision, commitment to Poland’s joining the euro, and invitation to the United Kingdom to join the eurozone, or at least not stand in the way of others, rules out any possibility of Britain leading a bloc of the outs.
The Danish krone already shadows the euro, Sweden does not exclude eventual euro membership, and the euro-skeptical Czechs have an economy deeply interwoven with Germany’s. This leaves the U.K. isolated on the eve of the summit. Above all, Cameron needs to keep his party behind him. This means somehow delivering on promises to protect the single market and the City of London and to repatriate certain powers, e.g. for labor legislation, from the EU to the U.K.
His only bargaining chip for this is British agreement to treaty changes among the 27, as sought by Germany. But what can he reasonably expect in return? Germany and France are unlikely to renounce a financial transactions tax even if it is adopted only within the eurozone. Blanket guarantees for the City are impractical; a drift in responsibility for financial regulation toward the eurozone, if it emerges from the crisis reinforced, seems unavoidable.
A generalized opt-out from the Working Time Directive, which stipulates maximum working hours and obligatory time off for workers throughout the EU, is not necessarily within Merkel’s gift and in itself would hardly warrant Cameron’s acceptance of a whole new treaty. If Britain pushes too hard, Germany and France will go for a eurozone-only treaty, establishing the rules for “economic governance.”
Sikorski’s Berlin speech, building on earlier declarations by Polish finance minister Jacek Rostowski, makes the British government’s task more difficult. Sikorski sets out mainly longer-term federalist goals and does not chart a way out of present dilemmas. Yet Cameron must bring home sufficient concessions to British demands if he is to support a political declaration committing the member states to a new treaty with stricter provisions on budget disciple.
Such a declaration seems to be Germany’s condition for agreeing to support wayward eurozone members. Barely ten days remain to strike a deal that will have enormous implications for the future of Britain and the EU as a whole.
Michael Leigh is a Senior Advisor to the German Marshall Fund and is based in Brussels.
The views expressed in GMF publications and commentary are the views of the author alone.