The UK’s ‘in-out’ EU referendum campaign moves up to top gear this week with the first TV debate featuring Prime Minister David Cameron on Thursday. With Parliament now in recess, and both sides in full-time campaign mode with the finish line on the horizon, European leaders are also beginning to prepare for the prospect of Brexit, potentially the worst reversal for the EU in its more than half century history.
The central concern in Brussels and European capitals is not just that the UK’s departure would weaken the EU, but also significantly disrupt for years to come the currently 28 member state’s balance of power, inner workings, and policy orientations. Discussions in Europe in recent days have therefore centred on two main levels: Firstly, how to respond to the possible political trauma and financial market turmoil in the immediate aftermath of the June 23 vote, and, secondly, in the weeks and months beyond how best to emphasise the resilience and integrity of the continuing EU project.
In the immediate term, European leaders have postponed a regular EU summit of national leaders previously scheduled for June 23-24 until later in the month (June 28-29). If Britain votes to leave, it is also anticipated that the European Commission would hold an emergency meeting in the 72 hours after the result.
Moreover, on the economic front, the European Central Bank and the Bank of England are preparing to make potential interventions to respond to market volatility when the outcome is announced on June 24. For instance, it has been reported that Bank of England Governor Mark Carney has already spoken with some financial institutions about the prospect of an UK interest cut in the event of a leave vote.
Beyond the EU’s immediate response in the aftermath of a UK vote to leave, there is less consensus in Brussels and European capitals over the best way forward. Some policymakers, including Dutch Finance Minister Jeroen Dijsselbloem, the Chair of the Eurogroup of Finance Ministers, have argued for caution, asserting that “if a negative outcome of the UK referendum should be interpreted as a vote against Europe, it doesn’t make sense in my view to respond immediately by asking for more Europe” in the form of new, potentially grand integration schemes.
Scepticism of the wisdom of further economic integration is echoed in the French and German governments, given the significant potential for popular backlash against such a move, ahead of the 2017 national elections in both countries. In Paris, for instance, there is concern that further controversial EU initiatives could provide a fillip to the far-right National Front’s Marine Le Pen who is currently riding high in the opinion polls and who has promised a referendum on French membership of the EU (so-called Frexit) if she is elected the country’s president.
Other senior decision-makers, including Commission President Jean- Claude Juncker, are perceived to favour a stronger integrationist response to a British vote to leave, but recognise the sensitivities of this, especially given the 2017 French and Germany ballots. In this context, one key area of policy that Juncker and some other EU officials think could be ripe for a stronger, common agenda is security and defence. This is reported to have been discussed by French President Francois Hollande and German Chancellor Angel Merkel on Sunday when they met at the commemorations for the 100th anniversary of Verdun, one of the most significant battles of the First World War.
Window of opportunity
EU internal and external security policy, which involves both the 19 Eurozone states and 9 other EU members, has come under intensified focus with recent terrorist atrocities on the continent; the ongoing migration crisis; and also Russian’s assertive posture toward Ukraine and its annexation of Crimea. Moreover, there is also an added political ‘window of opportunity’ to move forward on this agenda with High Representative of the EU for Foreign Affairs and Security Policy, Federica Mogherini, expected to present a new global strategy on foreign and security policy in the second half of June, the first such European strategy since 2003.
Mogherini will present this document in a context where several leading politicians, including Italian Prime Minister Matteo Renzi, have already called for a “European pact for freedom and security” in the wake of March’s terrorist attacks in Brussels. This highlights that a carefully crafted package of measures, including greater EU intelligence cooperation and strengthening Europe’s border force, could secure political traction, and potentially chime with the public mood too.
More potentially controversial, however, is greater defence cooperation with the continental debate over this issue dating back to at least the 1950s when an initiative to form a European Defence Community failed to see the light of day. Today, however, the impulse toward greater defence integration is being driven by Russian assertiveness, and financial pressure on national defence budgets. And ironically, British exit of the EU could also eliminate a longstanding obstacle to greater European cooperation in this area given that the UK government has long been opposed to deeper continental defence integration.
One signal of potential movement on this agenda came in March when Juncker asserted that the EU needs its own army, a proposal welcomed by German Defence Minister Ursula von der Leyen, so Europe can “react more credibly to the threat to peace in a member state or in a neighbouring state”. While such an army is at best a longer-term aspiration, however, plans are being drawn up — which could be accelerated — for so-called “structured cooperation” between willing EU states to develop common centres of military planning, material and personnel.
Taken overall, EU planning is intensifying for the prospect of a British exit vote. In this leave scenario, European leaders will seek a coordinated front, but divisions remain about how best to respond to what could be the EU’s most significant setback.
Andrew Hammond is an Associate at LSE IDEAS (the Centre for International Affairs, Diplomacy and Planning) at the London School of Economics.