The Diplomatic Dispatch

The British Ambassador to Sweden blogs on The Local

Posts Tagged ‘Europe’

War and Remembrance

Tuesday, July 1st, 2014

28 June marked the centenary of the assassination of Archduke Franz Ferdinand – the event that set in train the outbreak of the First World War.

Of course the causes of the war were much more complicated than one violent act. Last week we hosted an event at the Residence where British historian Andrew Oldfield gave us a fascinating insight into the political, economic and cultural conditions which led to war.

The consequences are still with us, as I noted in my talk; if post-war Europe was a “landscape with ruins”, as one historian noted, the Middle East today remains a landscape with fault lines, some of them dating from the aftermaths of the First and Second World Wars.

So remembering our history and understanding its lessons, I argued, is crucial to effective diplomacy. That’s why the British government has invested in a range of events to mark the centenary of the Great War.

WWI Podcasts

On 28 June the Foreign Secretary launched a series of WWI Podcasts based on original Foreign Office dispatches from the 28 June assassination to Britain entering the War on 4 August (the so called “July Crisis?”). In the interviews, the Foreign Secretary and former British Ambassadors to Austria, Belgium, France, Germany, Russia and Serbia help set the context for what was unfolding in Europe and describe what it must have been like for their predecessors during that period. ?The podcasts are available at

WWI Tweets

In another digital project to mark the July Crisis, FCO Historians will tweet, in real time, extracts from Foreign Office telegrams, dispatches and letters leading up to the outbreak of WWI. Eleven twitter accounts have been set up reflecting the key British diplomatic figures from 1914. They will tweet from their respective accounts and be re-tweeted from a central FCO account: @WWIFO. You can sign-up and follow the tweets as they come in real-time 100 years to the day. A blog has also been posted on the History of Government website on Gov.UK to provide the context and background.

UN Security Council

Finally, commemoration of WWI will be a major theme of the UK’s Presidency of the Security Council in August. The UK will co-lead with Australia a Security Council visit to Belgium on 9-10 August. The Council will hold a session on conflict prevention with academics, visit a multinational war cemetery and attend the Last Post ceremony at the Menin Gates. During our Presidency we shall also host an exhibition of WWI poetry in the UN Secretariat building which will feature poems from different countries.

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Europe: After the Vote

Monday, June 30th, 2014

Much ink has already been spilled (or many keys have already been tapped) in analysing the European Council’s decision to nominate Jean-Claude Juncker to head the European Commission.

My government has been clear that the decision was wrong in principle, as a matter as process and as an issue of policy.

For that reason the UK stood up for the principle that the European Council – the elected national leaders – should be the ones to propose the Commission President, not be dictated to by political groups in the European Parliament.

This was a position shared by all three main political parties in Britain. In the UK, as in most other EU countries, the so-called Spitzencandidates had been invisible in the elections. The notion that they automatically represented the conscious choice of a European demos is nonsense.

So it was important and welcome that the European Council agreed to review what has happened and to consider how we handle the appointment of the next Commission President. We need to ensure we get a choice of high-quality candidates in the future.

This whole process has reinforced my Prime Minister’s conviction, as he said in Brussels, that the EU needs to change to address the concerns of citizens across Europe and thus close the gap between people in Europe and the EU institutions.

For us, it’s clear that the status quo – “Brussels as usual” – is not right for the EU of today, let alone that of tomorrow. We won’t be able to sustain a diverse, flexible and competitive continent unless we look the challenges and opportunities of modernity and globalisation in the face.

The Prime Minister was clear that Britain’s national interest still lies in our membership of a reformed EU and that he is determined to achieve that through discussion and renegotiation.

He, with others, secured progress in a number of important respects at the Council:

For the first time all Member States have agreed that the EU will need to address Britain’s concerns about the EU in the next few years. We know these are shared by others.

Leaders have also agreed that “ever closer union” allows for different paths of integration for different countries and to respect the wish of those who do not want deeper integration.

We have also embedded Britain’s push for reform, which is shared by other Partners, in the Council’s mandate for the Commission for the next five years:

-prioritising work to building stronger economies and creating jobs.

-making clear the EU should only act where it makes a real difference – leaving it to nation-states where it doesn’t.

– giving national parliaments a stronger role.

– tackling issues that worry voters such as the abuse of free movement in certain countries.

Of course, this is only a start and more change is needed. The PM accepts that what happened in Brussels on Friday will make reform tougher and the stakes higher. But he’s clear that reforming the EU and the UK’s role within is necessary and also achievable.

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A Wake-Up Call for Europe

Monday, June 9th, 2014

Tonight David Cameron pays his second visit to Sweden in just over two years. In 2012 it was to meet his Nordic and Baltic counterparts. Tonight and tomorrow Prime Minister Reinfeldt is again his host, this time at Harpsund. And this time, the German Chancellor and Dutch Prime Minister will be the other participants. At a crucial moment in the European debate they’ll be charting a reform course for the EU. Here’s the article I published in the leading Swedish business newspaper Dagens Industri today, setting out our view of the reform challenges ahead.


Today David Cameron comes to Sweden to discuss the future of Europe.

Two weeks ago citizens voted across Europe to elect a new European Parliament.

Earthquakes, tremors, seismic waves: the media air was full of metaphors as pundits reflected on the emerging results.

The analogy that sprung to my mind was less a natural disaster than a wake-up call.

Some will say the results in the UK suggest that it’s already too late: that Britain has overslept and is sleepwalking out of the EU.

The UK government disagrees. These results show that people across Europe are disillusioned with the EU. Not a surprise, given the longest recession in living memory. But this is about more than economics: it’s about politics too. A return to growth, crucial though that is, will not solve all the EU’s problems. What we need is a serious rethink of where the EU goes next and how.

That was the message my Prime Minister took to the European Council dinner on 27 May. It was a message echoed around the table.

This is not a moment for the EU to panic. But emphatically it is not a time to return to business as usual.

What we need is new thinking, some new faces and a new agenda for the next Commission and the next 5 years, set by the European Council. Many leaders are committed to reforming the European Union.

That’s why David Cameron, along with Germany’s Angela Merkel and Mark Rutte of the Netherlands , has accepted the invitation of Fredrik Reinfeldt, to meet at Harpsund on 9-10 June, to look at the real reform challenges facing the EU up to 2020 and beyond.

For the UK, these concern above all competitiveness, fairness and flexibility.

Competitiveness, because the election results speak to a deep concern that Europe has lost sight of its key mission, to secure prosperity for its citizens. The next Commission, the member states, national parliaments and the European Parliament need a ruthless focus on creating jobs and growth. More free trade, less, and smarter, regulation, fewer barriers to commerce and innovation: these must be the watchwords if we are to respond effectively to the challenges of globalisation and demographic change.

Fairness, because the evolution of the Union needs to work for all member states, large and small, inside and outside the eurozone. We need eurozone governments to take the right decisions to stabilise and strengthen governance of the single currency. But access to the single market, and non-discriminatory treatment of all member states, not least those with big financial sectors like Sweden and Britain, means a fairer EU is integral to a more competitive EU.

And with competitiveness and fairness must come greater flexibility. If Sunday’s results demonstrate anything it’s that the EU’s institutions have become dangerously remote from those who pay for them and elect them. Centralisation and harmonisation in the pursuit of an abstract ideal need to be replaced with a more modern vision: where, as the Dutch government has said, it’s Europe where necessary, national where possible.

As long ago as 2001 Europe’s Heads agreed that powers could flow down as well as up, away from the centre as well as toward Brussels. It’s long past time to act on that.

The elections were thus a wake-up call for Europe. Some Europeans, although not many Swedes, have had a tendency to decry the UK debate on Europe, “noisy neighbours” endlessly questioning the status quo, the acquis, the Project.

But increasingly our debate is a Europe-wide debate, not about dismantling the European Union, but about adapting it for the future.

And it’s essentially a cross-party issue in Britain. Of course the Westminster parties differ on the details. The Conservatives would have an in-out referendum, following negotiation of a new settlement for the UK in Europe, by the end of 2017. Labour and the Liberals would have such a referendum only in the event of a Treaty change transferring powers from Britain to Brussels.

But all agree on the need to reform Europe.

As David Cameron concluded his Bloomberg speech in January 2013: “I believe something very deeply. That Britain’s national interest is best served in a flexible, adaptable and open European Union and that such a European Union is best with Britain in it… I will not rest until this debate is won. For the future of my country. For the success of the European Union. And for the prosperity of our peoples for generations to come. “

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Towards a More Balanced and Effective European Union

Friday, February 14th, 2014

The head of the UK Diplomatic Service (my boss’s boss’s boss!) was in Stockholm this week and talked at UI about Britain’s agenda for EU reform.

To help support and underpin the reform debate in the UK (and more widely), our government initiated a review of the so-called Balance of Competences between the EU and the UK. In other words, how does the current distribution of power between Brussels and the Member States impact on the UK in various areas.

This week the second batch of reports were published. They cover: the free movement of goods; asylum and non-EU migration; trade and investment; transport; environment and climate change; research and development; tourism, culture and sport; and civil judicial cooperation.  They draw on a wide range of evidence to analyse the impact that EU action has on the UK national interest, and the future challenges that may arise. The review process is Government-led but involves extensive consultation with a wide range of interested parties including think tanks, academia, business and Parliament. The reports can be viewed here.

Together, the first and second semesters have received over 1,000 submissions from a broad range of organisations across the UK and beyond. Once complete, the review will provide the most extensive analysis of the impact of EU membership on the UK ever undertaken. By bringing all the evidence together in one place for the first time, it will enable people to judge for themselves what works well and where there is room for improvement. The review is an analytical, transparent and evidence-based process that will not make policy recommendations.

To date, much of the evidence echoes the UK’s ongoing arguments for EU reform which focus on helping to deliver greater growth and prosperity for all Member States. This includes for example, the need for a broader and deeper Single Market, greater competitiveness and flexibility, and better, and less, regulation.

They also identify benefits that EU membership can bring – not least the positive economic impact of the Single Market. Evidence cited in the reports suggests that, from 1996-2006, EU import prices for textiles and clothing fell by 27.5 and 38.4% respectively in real terms as a result of liberalising measures.   But contributors highlighted that more could be done to maximise the potential that liberalised markets offer to consumers and businesses.

The need for better, and less, EU regulation is a theme that runs through several of the reports. They highlight areas in which EU legislation is considered to be too prescriptive or not sufficiently proportionate or risk based. Some contributors noted that the EU ought now to focus on implementation and enforcement, rather than new legislation, and concerns were also raised over the transparency around, and level of, consultation with industry by EU institutions in proposing legislation, including the quality of underlying impact assessments.

The next set of reports is due to be published this summer.  The debate about EU reform will doubtless continue well beyond that!

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Europe: UK and Germany Partners in Reform

Monday, June 3rd, 2013

Some once said that football was a game where England played Germany over 90 minutes and extra time and then the Germans won on penalties.

Which is an inelegant way of saying that the UK and Germany are very much together on the reform team in the EU, with Sweden on side as well, of course.

Here are the key messages from our Foreign Minister’s speech last week in Germany. The full version can be found here.

The scale of the challenges facing Europe is serious.  Let me touch on three: First, how we make our way in an ever more competitive global economy.  Second, how we address the EU’s lack of democratic accountability. And third, how we ensure that the EU develops the flexibility to respect the diversity of its Member States.

Competitiveness and the Global Race

Germany has led the way in getting to grips with these challenges through a series of painful but impressive labour market reforms and through fiscal consolidation.

In Britain, our Government has reduced the deficit by a third over three years. The private sector has created one and a quarter million jobs.  Employment is around record levels, exceeding the pre-crisis peak even though we have reduced the public sector headcount by more than six hundred thousand.  We are rebalancing the economy towards high end manufacturing and exports.

Getting our finances and social models into shape is not, however, sufficient.  We must also create the right regulatory environment for economic growth.

World-class German and British manufacturers are already capitalising on the opportunities that emerging markets present.  We export BMWs made in Bavaria (one in four of which has an engine made in Britain) and advanced aircraft components engineered in Bristol and Bremen.  But we also need to look at what comes next: the opportunities in exporting our knowledge industries and professional services.

The size of the global middle class is projected to increase by three billion by 2030.  As prosperity levels increase, we want these new global consumers not only to drive an Audi and to fly in an Airbus, but to work in spaces designed by British and German architects, to negotiate international business through our law firms, and to finance those deals through London and Frankfurt.

This is one of the reasons why we are worried about the proposed Financial Transactions Tax. And why we are uncomfortable with the proposed cap on bankers’ bonuses.  Not because we don’t agree that the global financial industry needs better regulation: it does, and this British Government is proud to be putting in place some of the most exacting reforms of all, following the Vickers Report.  But that regulation needs to help us compete in the global race, not set our feet in concrete.

Lack of democratic legitimacy

The second major challenge is how we build the democratic legitimacy of the European Union.

I think the British people also want the EU to be a multiplier of our collective influence and values in the world, so that we can forge trade agreements that open new markets, tackle global poverty, or ensure the Iranian regime experiences real consequences for nuclear proliferation.

But they do not understand why Brussels has to interfere in how long junior doctors can work.  Or why someone from another Member State should be able to continue to claim benefits in the UK even after they have moved back to their own country.  I think we are all relieved that the European Commission is not going to ban Europeans from using olive oil jugs at restaurant tables.  But it is extraordinary that such a decision should be within the EU’s power in the first place.

Too often, the British people feel that Europe is something that happens to them, not something they have enough of a say over.  That the EU is happy speaking but does not seem interested in listening.  That the EU is sometimes part of the problem, not the solution.

This is not just a British issue.

The latest Pew Research from earlier this month is a warning: a sharp fall in support for the EU across the continent. Eight points lower in Germany, at 60 percent. Two points lower in Britain, at 43 percent. 19 points lower in France, at 41 percent.

Trust in the institutions is at an all time low.  The EU is facing a crisis of legitimacy.

The European Parliament plays an important role in holding European institutions to account.  It can play a very positive role, as it has along with Commissioner Damanaki in the current reforms to the Common Fisheries Policy.  But if the European Parliament were the answer to the question of democratic legitimacy we wouldn’t still be asking it.

I think instead that the solution lies in promoting the role of national institutions in European decision-making – because ultimately it is national governments and national parliaments that are accountable to our electorates.  They are the democratic levers voters know how to pull. I want to offer some thoughts on how we might do that in a moment.

Need for flexibility

This idea of the right balance between national and European decision-making, and respect for the concepts of proportionality and subsidiarity, brings me to my third key challenge. How can we build a European Union that acknowledges and respects the diversity of its Member States?  One that recognises that our national approaches to and ambitions for the European Union may sometimes differ?

These are relatively new concepts.  We do not yet have the answers.  But we need to start asking the right questions, as partners in a shared endeavour.

Britain in Europe

I know that our friends in Germany and across the Continent follow closely the vigorous debate on Europe that we have in Britain.  They could perhaps at times be forgiven for asking themselves about our commitment to making European Union work.

But the Prime Minister couldn’t have been clearer in his speech in January.

He said that Britain’s national interest is best served in a flexible, adaptable and open European Union.

That such a European Union is best with Britain in it.

And that he will campaign for such an arrangement with all his heart and soul.

So now we want to get on with the business of delivering that reformed EU.

And here, Britain and Germany must lead the way.

A shared reform agenda

Let me set out four areas on which I think we might focus together:

First, deepening the Single Market so that we’re making the most of the growth opportunities in digital, energy and services.

Development of a digital single market by 2020 could result in a four percent increase in EU GDP.  With the European e-commerce market forecast to double in size to 625 billion euros by the end of 2016, we need to start by strengthening cross-border e-commerce.

On energy, we need to go further in increasing competition across the single market, liberalising gas and electricity markets, developing new low carbon energy sources and supply corridors, and strengthening interconnections between countries to enable EU-wide trade in clean, low carbon electricity.  Cheaper energy would boost British and German companies alike.

On services we need to start by ensuring that the Services Directive is fully implemented across all EU Member States.  The European Commission estimated last year that just ensuring that all Member States improved their implementation to at least the current average level would add 0.4% to EU GDP.  Full implementation of the Services Directive could add 2.6% to EU GDP.

Second, making regulation work for business, not hold it back.

Here we are asking businesses what proposals they want to see from the Commission for reducing the regulatory burden – where SMEs need to be exempted, where rules need to be simplified, and where regulations need to be withdrawn altogether.  We look forward to identifying common priorities with Germany and other partners.

Third, building new trade relationships.

Concluding all on-going and potential free trade agreements could boost EU GDP by two percent.  Germany and Britain have worked hard over the last year to put the Transatlantic Trade and Investment Partnership at the top of the agenda.  It could be worth 119 billion euros a year to the European Union and 95 billion euros to the United States.  But perhaps more importantly, with a combined population of almost half of global GDP and nearly a third of global trade flows, Europe and the United States will be able to shape international trading standards for decades to come.

This is why it is important that we grasp the opportunity to launch ambitious negotiations next month, in time for President Obama’s visit to Northern Ireland for the G8 Summit. And why we should not limit the potential of those negotiations by excluding certain sectors from the start.  On audio-visual, for example, we should have the confidence to recognise the opportunity that the American market offers us, worth 400 billion euros and growing at five per cent per year.

And fourth, starting to make the EU more democratically responsive.

I do not want to go into great detail at this stage, not least because David Lidington, our Minister for Europe, set out some ideas in his speech at the Europaforum in Berlin earlier this month.  But my strong sense is that we need to recognise that most people across Europe look to their own national institutions.  We need to rediscover the role of national governments and national parliaments.  Because, as Chancellor Merkel pointed out recently, Europe’s value is not measured by the growth of the acquis communautaire.

In Britain, we are looking at the balance of competences between the EU and the national level.  We want this work to contribute to an informed and serious debate in the UK.  We also hope it will be of interest to our European partners, as similar discussions take place in other member states.

At the same time, we should do more to help our parliaments exercise their right to work together to raise a yellow card to object to legislation where action should be taken at a national rather than a European level, in line with the principle of subsidiarity.  We should explore whether the yellow card provision could be strengthened or extended to give our parliaments the right to ask the Commission to start again where legislation is too intrusive, and fails the proportionality test. And we should think about going further still and consider a red card to give national parliaments the right to block legislation that need not be agreed at the European level.


Finding the right balance between integration in Europe for those who need it, and flexibility where it is best for our economies and our democracies, is the great challenge of German and British diplomacy over the next few years.  Taking our voters with us, at the same time as we modernise our economies and states, is the great challenge for German and British politicians.

The more closely we work together, the more successful we will be in building a European Union fit for the 21st Century, and one which can truly earn the support and trust of people across our Continent and beyond.

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Voting for a Greener Future

Tuesday, April 16th, 2013
Today, an important vote is taking place in the European Parliament. The British Government has asked all British MEPs to vote for a more competitive EU by supporting a higher price on carbon emissions.
A well-functioning market, where it is more expensive to produce carbon emissions is crucial for green growth, and for the UK, Sweden, and all other EU member states. The EU’s Trading Emissions scheme helps drive European innovation and competitiveness by incentivising the green economy with its green technologies and low-carbon investments.
Globally, in 2010-11, the green economy (low carbon and environmental goods and services) was valued at around £3.3 trillion, having grown by 3.7% from the previous year despite the economic slowdown. The global market is projected to continue to grow by around 4% over the next four years. A green economy is needed to create new jobs and reach new export markets. China’s Five Year Plan 2011-15 that invests $1.5 trillion (5% of GDP) in strategic new green industries clearly signals the green economy is the way of the future.
Europe needs to be able to compete with countries such as China, in this sector. A higher price for emissions would make this easier. It would benefit Europe – especially Sweden, who has a leading position in green technologies.
We also need a strong price signal that prevents us from being able to lock into a system based on old-fashioned fossil fuels.
Unfortunately, there is now a surplus in the market which has resulted in a very low price on emissions, reducing the incentive to innovate.
The European Commission has therefore suggested a temporary reduction in the number of emission allowances, with them being placed back into the system at a later date. By back-loading these emissions allowances, fewer will be available in the short-term, thereby driving up the price.
Although the UK generally agrees that market interference should be kept to a minimum, the current low price and market volatility put the smooth functioning and liquidity of the market at risk. The proposed one-off intervention would help to restore confidence in the market, before longer-term reforms to strengthen the system can be brought in.
Failure to agree back-loading will mean that the EU carbon price is likely to remain consistently low in the medium-term, potentially impacting market investors’ confidence and ability to invest in future low carbon technologies. An agreement now would minimise uncertainty and distortions, and promote investment. That’s why the British Government is encouraging MEPs from all countries and parties to support it.

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Europe, energy, and the green growth economy

Tuesday, February 26th, 2013

Last week I spent two fascinating days in Uppsala, talking to students about UK views on the future of Europe, and meeting local politicians, businesses and academics.

I stressed, as I did at a meeting with the British-Swedish Chamber of Commerce, the UK’s commitment to the EU, but also our recognition of the need for reform.

We had a top UK politician in Stockholm last week.

The Energy and Climate Change Secretary, Ed Davey, met his Swedish counterparts, Anna-Karin Hatt and Lena Ek. He also talked to actual and potential Swedish investors in the UK.

There’s a huge opportunity for Swedish investors in the UK energy market.  We need £110 billion investment over the next decade to replace our ageing energy infrastructure (coal fired power plants and nuclear energy) with a more diverse and low-carbon energy mix, particularly more renewable energy.

We start the process of decarbonising our economy a long way behind Sweden, given your natural advantages. Our aim is to have 15% of our energy from renewable by 2020 (which is our EU target), whereas Sweden is already, I think, getting more than triple that, almost half its energy, from renewables.

But we’re committed to meeting our goals: indeed we’ve set a long term goal of cutting carbon emissions by 80% by 2050; that is why it is so important that we increase the share of our energy we get from renewables alongside other low carbon technologies such as carbon capture and storage.

Ed Davey and Lena Ek talked to their Danish and Dutch counterparts about the need to make the case, in the EU and beyond, for a Green Growth strategy, showing that making the planet healthier is fully compatible with continuing to grow our economies. That will also be a theme when David Cameron goes to Latvia to meet his Nordic and Baltic counterparts at the third Northern Future Forum this week.

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Five Principles for Europe’s Future

Friday, January 25th, 2013

As you will have seen, the British Prime Minister made an important speech on the future of the EU in London on 23 January.

The PM’s speech reiterates his commitment to keeping the UK in the EU, at the heart of the Single Market, but also leading EU action on energy, climate change, development, foreign policy and other global challenges.

The speech also assesses the challenges that all of us in Europe face. Specifically, the challenges of the Eurozone crisis and the changes it is driving in Europe, Competitiveness in the face of a transformed global economy, and the gap between Europe and its peoples.

The PM proposes five principles for reform to overcome these challenges:

• Competitiveness: a serious effort to deepen the Single Market, cut red tape, open up trade and reform the EU’s institutions

• Flexibility: embracing the diversity of the EU, rather than insisting on one size fits all. He has offered some initial ideas on what that means. But we recognise that we are at the beginning of that debate, not the end.

• Power must be able to flow back to Member States, as EU leaders have previously promised: we should examine what the EU should do and should stop doing

• Democratic accountability: there has to be a bigger role for national parliaments

• Fairness: the changes brought by the Eurozone crisis must not undermine the integrity of the Single Market

These are far-reaching and complex issues for Britain and the EU. Britain wants to work these through with our EU partners. We want to work with Sweden and others to help shape the future of an open, flexible and adaptable European Union, to achieve not just a better deal for Britain, but a better deal for Europe too.

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Europe in 2013

Tuesday, January 8th, 2013

First and foremost, happy New Year. I hope 2013 is a great year for all of you.

Late 2012 marked the mid-point of the UK Coalition government’s five year term and this week the Prime Minister and Deputy Prime Minister published the Government’s own mid-term review.

Given the interest in Sweden on the UK’s approach to the EU, I thought I would summarise here some of the key points on Europe:

–    The Government is committed to membership of the European Union. The future of our economy is deeply connected to the stability and prosperity of the EU.
–    It is therefore in our interests that the immediate crisis in the Eurozone should be resolved as speedily and effectively as possible.
–    In the long run, European Union prosperity depends on free and open markets. We are committed to working for the completion of the single market.

–    At the same time, we will oppose any new burdensome and costly regulatory proposals which threaten our competitiveness, and, alongside like-minded allies, insist on discipline in European Union spending.

The review sets out some of the Government’s key priorities for the year ahead, including:

– We will insist on a tough, fiscally responsible outcome of the negotiations on the next EU seven-year budget framework, continue to make the case for Common Agricultural Policy reform and prevent any changes to the British rebate.
– We will continue vigorously to defend Britain’s interests in the negotiations on a banking union and protect the competitiveness of the City of London and UK financial services. The safeguards that we have achieved in the initial banking union negotiations set a crucial precedent, and will protect countries such as the UK which are not part of the single supervisory mechanism.
– We will continue to lead the EU growth agenda – with the aim of removing unnecessary regulations particularly for small and innovative companies, deepening and widening the single market and liberalising trade, notably by negotiating a free trade deal with the US.

Those three areas – ensuring a realistic budget for the EU, ensuring that the rights of all member states are respected, in particular with regard to the Single Market, as the Eurozone integrates, and a focus on growth and trade –  are all areas where the UK and Sweden will, I am sure, continue to work closely together in 2013 and beyond.

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Challenges facing Europe: A British view

Wednesday, October 3rd, 2012

Britain’s future relationship with the EU is a subject of constant debate.  This week our Minister for Europe, David Lidington,  has been in Stockholm,  addressing the challenges the EU faces.  He had good meetings with Carl Bildt and Birgitta Ohlsson.

In a talk at Utrikespolitiska Institutet he stressed that for all the attention given to the eurozone, the long term challenge for Europe was whether we could remain competitive faced with the shift of wealth and power to the emerging economies.  That would require some tough and bold choices, where the UK and Sweden had a lot to offer the debate.

So although it’s fashionable in some countries (not in Sweden) to say Britain has no positive agenda for Europe, the Minister made clear that we, like Sweden, champion further reform:

–    extending the single market to digital: why is only one tenth of e-commerce in Europe cross-border?  because the status quo makes it too difficult;
–    extending the single market to energy and services, which could reduce burdens for business and create huge numbers of new jobs;
–    pursuing enlargement to the Western Balkans and Turkey, bringing dynamic economies into the European mainstream;
–    pursuing external free trade, with the emerging economies and with the US and Japan.

David Lidington made clear that the debate was more complex than whether or not to accept a two-speed Europe. In practice the Europe of the future would be diverse and multifaceted. Not everyone would join the single currency or Schengen, but all EU member states had equal rights to participate in that single market and to help shape Europe’s Common Foreign and Security Policy, underpinning stability on our borders and beyond.

The Minister made clear that the Coalition government in the UK was committed to active and engaged membership of the EU, that we were ambitious for reform and renewal, and that we had no closer or more valuable partner than Sweden in the long term challenge of pursuing our shared interests in building a modern, liberal outward facing and inclusive European Union.

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