By September, the 12 member countries of the European Community will ratify the controversial Maastricht Treaty, which will eliminate existing economic, political and trade barriers among the cosigners and calls for the establishment of a single European currency in 1999.
So predicted Andreas van Agt, ambassador of the European Communities (EC) to the United States during his speech at the Library on March 4. The ambassador's visit was the latest in the European Division's monthly lecture series that brings distinguished experts from the United States and abroad to the Library to discuss international issues.
Ambassador van Agt was Prime Minister of the Netherlands from 1977 to 1982 and in 1990 became the EC's first diplomatic representative to the United States, after serving in the same capacity for the Community in Tokyo since May 1987. He began by acknowledging that the start of 1993 was eventful for both the United States and Europe, but for entirely different reasons.
"Your inauguration of a new president sparked enthusiasm bordering on euphoria and near messianic expectations," he recalled, "Meanwhile, Europe took the first step in opening a single market. But the prevailing mood was not festive but one of concern. There were no celebrations over this inauguration; there were no parades."
The European Community was created by six member countries after World War II; since then, its membership has grown to 12: Belgium, Denmark, France, Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal, Spain and the United Kingdom. Subsequent treaties established three separate communities within the whole: the European Coal and Steel Community, the European Economic Community and the European Atomic Energy Community. The EC has its own legislative Commission, a Council of Ministers to enact legislation and make other decisions, an elected Parliament and a Court of Justice, which corresponds to the U.S. Supreme Court, serving as the ultimate interpreter of EC law. Headquartered in Brussels, the EC has established 100 official delegations throughout the world and has been formally recognized by approximately 130 countries.
Ambassador van Agt explained that the Maastricht Treaty will consolidate European trade into a single market and solidify political and security matters; the provisions call for the institution of a single currency by 1999, to be managed by the European Central Bank. This unification process is already under way.
"Sustained efforts to promote political unity have resulted in EC states acting in concert or, at least, not drifting apart," the ambassador said. "Take the situation in Yugoslavia, for example. There were rumblings in the EC for a while when Germany pushed for early recognition of Croatia and Slovenia. Some had their doubts, but the ranks quickly closed; we had solidarity.
"I'm not claiming it as an achievement," he added hastily. "I am embarrassed over our inability to stop the slaughter and torture that has resulted; however, it is not obvious what could have been done to restore order."
To illustrate the importance and benefits of European unity to international stability, the ambassador noted that "the events in Sarajevo in 1914 plunged Europe and, in the end, America into a bloody world war because of the rancor between Great Britain, France and Germany. But Sarajevo in 1993 won't escalate into anything even remotely similar, thanks to Western Europe's advanced integration.
"However, harmony demands a price in indecision and inactivity," he added. "The situation in Macedonia is a case in point." (The republic of Macedonia, which has not been a stable nation-state since the time of Alexander the Great, is now reestablishing its independence and reclaiming its name. Part of northern Greece is also called Macedonia and its nationalist protests against sharing the name have caused the EC to postpone recognition of the former Yugoslav republic.)
"That doesn't mean we're just sitting on our hands," the ambassador continued. He pointed out that the EC is contributing massive amounts of humanitarian aid through its contributions to the United Nations, including large numbers of peace-keeping personnel.
Ambassador van Agt described the progress toward European unity as variable, ranging from "Eurosclerosis in the mid-1980s" to "Europhoria," sparked by moves toward market unification, which peaked in 1991. Since then, various countries have expressed worries about the changes in trade practices, social influences and economic effects such a sweeping unification agreement would institute, leading to periods of "eurogloom." Last fall, polls in some countries indicated significant citizen reluctance to adopt the treaty; last December, the Danish voted against it.
"The Danish no vote struck our optimism like a lightning bolt," Ambassador van Agt confessed. "We are heading for a second referendum, perhaps as early as mid-March. Denmark will vote, followed by Great Britain. When ratified, the treaty will affect 370 million people." He admitted that not all measures outlined in the treaty will automatically be instituted across the board.
"The odds of full participation in the single currency zone may be reduced by Europe's economic downturn. Forecasters are predicting less than 1 percent growth for the EC as a whole in 1993 and only 2 percent next year. Unemployment is at 10 to 11 percent. This adversity may prevent many countries from meeting the necessary economic criteria. We must curb inflation, stabilize interest rates and decrease unemployment first.
"It's also a question of political will on the part of all the member countries," he continued. "In times of economic harshness, governments tend to turn inward. Many leaders want to pull their governments out of recession before cementing European integration."
The ambassador expressed guarded optimism that ratification of Maastricht will usher in a unified and, therefore, stronger Europe. He quoted Lester Thurow, well-known American economist who predicted in his book Head to Head: The Coming Economic Government Between Japan, Germany and America that "Europe will emerge as the dominant power in the next century."
"I'm not as sure about that as the author," he added and then smiled. "But it makes for delightful reading."
The ambassador dismissed gloomy predictions voiced by "Cassandras" who believe that logistical difficulties will prevent economic unification among countries of the EC. "Most politicians and business leaders believe that the concept of a single market will be sustained by a single monetary currency," he observed. "Another reason for cautious optimism is the strength of the Franco-German alliance. Both countries are determined to advance the European integration process and are working together to defend the franc and the deutschemark. Such cooperation will be the core of the future European economic union. I predict that, unless Germany distances itself from such efforts, a single monetary currency will emerge by the end of the decade."
Ambassador van Agt also predicted the inclusion of Austria, Sweden, Finland and Norway in the EC within a few years, followed later perhaps by Turkey, Cyprus and Malta. The Czech Republic, Hungary, Poland and Slovakia may eventually obtain membership as well.
"If Europe disintegrates or declines, it will distract us from internal growth and from reaching out to fledgling democracies in Eastern Europe and the former Soviet Union," he warned. "The better we fare, the more economically and politically able we will be to offer market access and financial resources to these countries. And, with economic issues come important security issues, which will affect the U.S. as well. Trade between Western Europe and Eastern Europe has grown at an annual rate of 10 percent over the past four years. That's promising but still vastly insufficient. West Germany bears the brunt of support to Poland and supplied 60 percent of all assistance to the former Soviet Union and Eastern Europe. Assistance to Russia should be at the top of our agenda.
"Then, there's Japan and the other emerging countries; what role will they play on the world scene? ... We should not succumb to envy over their success. We must face the threat posed by the spread of Islamic fundamentalism, the need to rescue our planet for future generations, and it's time to re-structure the U.N. whose current composition reflects the old world order. Where is Germany? Where is Japan? There are so many challenges for an economically and politically united Europe to address. But unification must come first."
