Can the EU’s architecture support the Eurozone deal?

The agreement hashed out at yesterday’s summit of EU leaders envisions new fiscal and economic centralization for Eurozone members as well as some non-members, but not for all. Britain will apparently stand outside. So too may Sweden and Hungary. A key question then is whether and how existing EU institutions can be used to monitor ...

By , a professor at Indiana University’s Hamilton Lugar School of Global and International Studies.

The agreement hashed out at yesterday's summit of EU leaders envisions new fiscal and economic centralization for Eurozone members as well as some non-members, but not for all. Britain will apparently stand outside. So too may Sweden and Hungary. A key question then is whether and how existing EU institutions can be used to monitor and enforce the deal just struck.

The agreement hashed out at yesterday’s summit of EU leaders envisions new fiscal and economic centralization for Eurozone members as well as some non-members, but not for all. Britain will apparently stand outside. So too may Sweden and Hungary. A key question then is whether and how existing EU institutions can be used to monitor and enforce the deal just struck.

The short answer appears to be that they can’t. The EU institutions belong to the 27 (soon to be 28) members, not to a subset of them. All members must agree if the Commission, the European Court of Justice, or other elements of the system are to have any formal role with this new agreement. That appears to leave two options: 1) either the holdouts somehow agree that the rest can use the existing structures (while perhaps getting some kind of rebate so they’re not paying for services they’re not using); or 2) the "Eurozone plus" sets up some new architecture alongside the existing one. At first blush, both options seem plausible.  

In today’s FT, however, Wolfgang Munchau argues that the divergence set in motion by yesterday’s deal signals the end of the EU as we know it:

Thursday’s European Council meeting has demonstrated that a monetary union cannot co-exist with a group of permanent non-members in unified legal framework. The EU with its current treaties and institutions has proved to be an insufficiently flexible framework to run a monetary union and a disastrous framework for a monetary union in crisis.

These latest developments have reaffirmed my conviction that the only way to save the eurozone is to destroy the EU. But European governments may, of course, end up destroying both. All they did in the early hours of Friday morning was to create a new crisis without resolving the existing one.

Munchau insists that the tighter integration required by the new agreement will lead the Eurozone plus to do all sorts of things the others won’t do, thereby either sucking the life out of the existing EU institutions or straining any shared bodies to the breaking point.

David Bosco is a professor at Indiana University’s Hamilton Lugar School of Global and International Studies. He is the author of The Poseidon Project: The Struggle to Govern the World’s Oceans. Twitter: @multilateralist

Tag: EU

More from Foreign Policy

Newspapers in Tehran feature on their front page news about the China-brokered deal between Iran and Saudi Arabia to restore ties, signed in Beijing the previous day, on March, 11 2023.
Newspapers in Tehran feature on their front page news about the China-brokered deal between Iran and Saudi Arabia to restore ties, signed in Beijing the previous day, on March, 11 2023.

Saudi-Iranian Détente Is a Wake-Up Call for America

The peace plan is a big deal—and it’s no accident that China brokered it.

Austin and Gallant stand at podiums side by side next to each others' national flags.
Austin and Gallant stand at podiums side by side next to each others' national flags.

The U.S.-Israel Relationship No Longer Makes Sense

If Israel and its supporters want the country to continue receiving U.S. largesse, they will need to come up with a new narrative.

Russian President Vladimir Putin lays flowers at the Moscow Kremlin Wall in the Alexander Garden during an event marking Defender of the Fatherland Day in Moscow.
Russian President Vladimir Putin lays flowers at the Moscow Kremlin Wall in the Alexander Garden during an event marking Defender of the Fatherland Day in Moscow.

Putin Is Trapped in the Sunk-Cost Fallacy of War

Moscow is grasping for meaning in a meaningless invasion.

An Iranian man holds a newspaper reporting the China-brokered deal between Iran and Saudi Arabia to restore ties, in Tehran on March 11.
An Iranian man holds a newspaper reporting the China-brokered deal between Iran and Saudi Arabia to restore ties, in Tehran on March 11.

How China’s Saudi-Iran Deal Can Serve U.S. Interests

And why there’s less to Beijing’s diplomatic breakthrough than meets the eye.