European Union Presidencies are always short and intense, we’re in for an unusually intense first couple of months of EU politics. One of the two traditional, large, core member states of the Europe Union–France–has assumed control of the Council of the European Union for the first half of 2022. With the departure of Chancellor Merkel, France is the only EU member state with a leader anyone outside Europe could possibly name (sorry Olaf!). – Much is at stake for international business, not least tech.
As always, France has high ambitions for Europe, but with Omicron as the Scylla, and April’s national French presidential elections as the Charybdis, there’s precious little time and space to navigate any special ideas for Europe.
The French EU Presidency comes with a packed agenda. Strong French ambitions for the promotion of Europe’s future position in world affairs mean that we should expect a fast-paced first quarter with a heavy focus on Europe as a world power assuming control of its own destiny – especially in the security, digital, social, and economic domains.
Though the timing to push this agenda through is short, this may also actually be the right time for it, not least given the stout support of the new German government for a strong Europe. Reinforcing this further is an even deeper than usual commitment to French-German collaboration, which could drive interesting policy developments.
France is traditionally one of the main forces for further European integration. With France actually in the driver’s seat, it’s natural to expect a discussion about the Future of Europe and the path to further integration. The headline here is “European sovereignty”. Europe’s ability to enforce its own security and geopolitical interests will be at the core of this discussion.
Very few Europeans still believe European security is top of mind in Washington. Europeans are acutely conscious of a number of developments: the whole of the Trump era; the U.S./UK/Australian nuclear sub collaboration designed to keep French subs out of the Australian navy; how the U.S. precipitated the infamous international exodus from Kabul; and Putin’s clone army at the borders of Ukraine. Each drives this point home more than the next. Add to this Europe’s difficulties navigating the minefield of U.S.-China relations, and the urgency of European self-reliance becomes even more clear.
Europe is ultimately responsible for Europe’s security, and it should ensure its own capabilities to secure its borders and strategic geopolitical interests. In Paris, this is a paramount concern.
European sovereignty = Digital sovereignty
In 2022, European sovereignty also means European digital sovereignty. This implies too an increased focus on a traditionally strong industry policy agenda, not least in the digital area. Almost symbolically, France set the course on January 6 by announcing fines of €150 million for Google and €60 million for Facebook for a breach of privacy regulations in failing to allow French users to easily reject cookie-tracking technology. That France is strong both digitally and entrepreneurially means it will preside with urgency over the further development and implementation of the increasingly-heavy EU agenda of digital regulation. This agenda includes a global digital tax; the Digital Services and Digital Markets Acts (DSA and DMA) aimed at platforms; the AI Act; and the EU Chips Act, which seeks to secure Europe’s strategic position in semiconductors.
Needless to say, it is increasingly vital for any tech company outside the EU with interests in the European markets to understand and relate to this agenda. Though European digital sovereignty is in itself a French EU Presidency priority, the emphasis and importance of the growing regulatory agenda is far broader in scope.
The French/German partnership has always been vital for the direction and speed of European integration, and the strong orientation towards European advocacy of the new German red/green government bodes well for many French priorities. This seems to be true also in the area of climate policy and social policy, and for the ambition to ensure balance and growth in the wake of the pandemic.
Ambitions for the climate area most notably include the carbon border adjustment mechanism and furthering of the Commission’s landmark Fit for 55 program–the EU’s proposed target to reduce net greenhouse gas emissions by at least 55% by 2030.
Governments or markets rule?
In the efforts to promote flexibility in economic, industry, and social policies, France’s most crucial ally may again be the red/green German government, which is ambitious in its own right towards social policy. Its toughest adversary may turn out to be EU Competition Commissioner Margarethe Vestager, with regards to the Presidency’s designs to support key industries or even increasing state aid to create “industrial giants” in areas such as batteries, chips, and hydrogen.
It seems highly likely that the Presidency will succeed with the adoption of a European minimum wage. Even more important structurally is the new negotiation climate with a red/green government in Berlin, which may pave the way for reforms of the European Growth and Stability Pact’s stringent debt targets. Remember that the new German chancellor, Olaf Scholz, was one of the main architects of the recent EU pandemic loan package of 750 billion Euros for the Next Generation recovery fund. Given the strong green focus of the new German government, green investments could be the door opener for a slightly more flexible approach to the tight European financial stability rules. We’ll know at the EU summit in March – just a month ahead of the first round of the French presidential elections in April.
Finally, migration policy and control of external borders have become a fixture in European priorities. Migration continues on the risky path across the Mediterranean or through the Balkans; Belarusian dictator Lukashenko recently weaponized refugees at the Belarus/Polish borders; and discussions are heated between the UK and France about how to manage migration across the Channel. It is obvious that migration and the situation at the Union’s external borders are key strategic topics.
An ambitious agenda! And a meaningful one too for French President Macron’s ambitions to defeat ultraright candidates Marine Le Pen and Éric Zemmour as well as conservative Valérie Pécresse in April. Stakes are high, and President Macron cannot afford to take his eye off either the strategic priorities or his own future.
Søren Juul Jørgensen is a research fellow at the Center for Human Rights and International Justice at Stanford University, and Founder and CEO of the strategy firm ForestAvenue. He is a former Consul General of Denmark for California and was also CEO of Innovation Center Denmark in Silicon Valley.