Welcome to Wider Europe, RFE/RL's newsletter focusing on the key issues concerning the European Union, NATO, and other institutions and their relationships with the Western Balkans and Europe's Eastern neighborhoods.
I'm RFE/RL Europe Editor Rikard Jozwiak, and this week I'm drilling down on two big issues: Who will be the next EU enlargement commissioner and the race to join the Single Euro Payments Area.
Briefing #1: Picks And Portfolios: The EU's Foreign-Policy Posts
What You Need To Know: This week, European Commission President Ursula von der Leyen is set to present her team of 26 other commissioners for the period of 2024-2029. The plan is for her to present the lineup to the European Parliament on September 11 in order for the house's Committee on Legal Affairs to begin pre-screening the commissioners' eligibility in the latter part of September. This will allow for the proper thematic hearings with the candidates in the relevant committees to begin in October.
The European Parliament is expected to cull two or three candidates, as it normally does, so the process of getting the entire European Commission up and running by November 1 is an ambitious one. If a candidacy is snubbed, member states have to nominate new people and then more hearings will take place.
Each EU member state gets one commissioner and, last week, the lineup was more or less completed as 25 member states had put forward candidates. (It's 25 countries not 27 here, as von der Leyen is the German commissioner and Kaja Kallas, nominated earlier by EU leaders as the bloc's new foreign policy chief, represents Estonia.)
Getting 25 nominations wasn't easy though -- and it still might not be a done deal. Von der Leyen is pushing for gender parity among the commissioners and, this year, asked that capitals present two candidates for commissioner, a man and a woman.
So far only Bulgaria has heeded her call and there are now only 10 female candidates out of 27, including von der Leyen, Kallas, and the Bulgarian pick, former Foreign Minister Ekaterina Zaharieva, assuming she is confirmed.
Von der Leyen won't be happy as she did manage to achieve gender parity in 2019 and has always pledged to do so again. So, expect, some late haggling, where it's possible that member states' male candidates will be replaced by women.
Deep Background: So, what about the portfolios? Aside from Kallas as the foreign policy pick, it's interesting to see what von der Leyen is planning to do with the other foreign policy-related jobs. Last week, she announced that there will be a dedicated enlargement commissioner -- in other words, stripping down what is today the enlargement and neighborhood policy portfolio.
That means that the six EU hopefuls in the Western Balkans and the four other candidate countries -- Georgia, Moldova, Ukraine, and Turkey -- will have their own dedicated commissioner guiding them toward membership.
Earlier this summer, von der Leyen said that she would also have a commissioner dedicated to the Mediterranean region, meaning relations with countries in the EU's southern neighborhood such as Morocco and Tunisia, which can't apply for membership as they aren't geographically European.
But what happens if you're a country in the EU's "neighborhood" but not in Mediterranean region? Take Armenia, which was previously under the purview of the enlargement and neighborhood commissioner, and still has strong ambitions to join the EU. Now, it's less clear who they will work with: They could be under Kallas, or perhaps they would be grouped under the new Mediterranean portfolio with countries that can't or don't want to join the bloc.
Drilling Down
- Even more interesting are the names circulating, notably for the enlargement job, a topic that has become something of a priority for von der Leyen. German newspapers, citing sources close to the federal president, reported that she has picked Latvian Valdis Dombrovskis for the role.
- Dombrovskis is a former Latvian prime minister and has served for a decade as a European commissioner, for financial services and then trade. A heavyweight in the EU, he is known to be a confidant of von der Leyen. He has overseen the EU's financial aid to Ukraine, and, if he did get the enlargement portfolio, he would be in charge of the country's reconstruction. On top of that, he is one of only a few senior officials in the bloc who speaks Russian (and understands Ukrainian) and is very well-respected in Brussels and Kyiv alike.
- There are some question marks, however. Firstly, sources close to the Latvian who aren't authorized to speak on the record have batted the speculation away. And while clearly a veteran of EU bureaucracy, he is thought to be primarily "a numbers guy" suited to an economic role. And while his appointment would be great for Ukraine, enlargement is about much more than just Kyiv.
- He is also from the Baltic region. As noted previously, there are doubts whether the Baltic states would get both the foreign policy and enlargement portfolios. That would also rule out Lithuania's candidate for commissioner, the country's former Prime Minister Andrius Kubilius, who, according to numerous Lithuanian officials, is eyeing up the enlargement portfolio or even, potentially, a newly created EU defense portfolio.
- So what are the other options for enlargement? The current enlargement commissioner, Oliver Varhelyi, wants to continue and Hungary wants that too, but he has been fairly controversial, notably by adding extra obstacles for Ukrainian membership, and is unlikely to be offered a second chance.
- There has been some speculation that Maros Sefcovic could get the nod. The Slovak diplomat and politician has already served in the European Commission for 15 years in various capacities and is due an important portfolio. Well-connected and charismatic, he could be a good fit even if Bratislava currently isn't in Brussels' good books after taking an authoritarian turn under left-wing populist Prime Minister Robert Fico.
- Then there are two other names that keep popping up if the enlargement job doesn't go to an "easterner" -- Jessika Roswall, who has served as Sweden's EU minister, and Hadja Lahbib, a journalist and politician who has served as Belgium's foreign minister since 2022. While most other candidates have some sort of economic background, these two, with their backgrounds, would arguably be a natural fit, as they are already well familiar with the EU's enlargement policy.
- However, neither candidate is a shoo-in. Swedish sources close to Roswall, who aren't authorized to speak on the record, have categorically denied to me that they are interested in anything foreign policy-related, preferring something instead in the digital sphere or maybe trade. Lahbib has plenty of critics and has taken heat for traveling to Ukraine's Russian-occupied Crimea in 2021, when she was still working as a journalist.
- The Mediterranean portfolio could suit her better but, for that, she might face competition from the Croatian candidate, Dubravka Suica, who recently served as the European commissioner for demography and is thought to be a front-runner.
Briefing #2: The Single Payments Race
What You Need To Know: The Single Euro Payments Area (SEPA) started life in 2008, created by the European Union to simplify bank transfers in euros, with the aim of reducing bank fees and boosting both cross-border commerce and consumer spending. It's fair to say that it has been one of the bloc's more successful moves. The system processes some 50 billion transactions every year and, according to the European Payments Council (EPC), the body that oversees SEPA, it has reduced the costs of moving capital around the continent by 3 percent of the EU's average gross domestic product.
First used by the eurozone states, there are now 36 members, including all 27 EU members; the four countries of the European Free Trade Association (EFTA) -- Iceland, Norway, Liechtenstein, and Switzerland; the quartet of European microstates, Andorra, Monaco, San Marino, and the Vatican; as well as the United Kingdom, which opted to stay in the system after Brexit in 2020.
Oddly enough, Kosovo and Montenegro are not yet part of the system, even though both countries use the euro as their de facto national currency.
Deep Background: That could change now that the goal of the European Commission is for the EU candidate countries in the Western Balkans and in the bloc's eastern neighborhood to join the system as well.
That would make sense both economically and politically. The bloc is keen to start gradually integrating these countries into EU structures and money transfers are, according to the diplomats I have spoken to, relatively "low-hanging fruit." It would also make it easier for companies from candidate countries to do business with the bloc, plus it would facilitate remittances from citizens of these countries living in the EU and sending money back home. Moldovan Central Bank head Anca Dragu has noted that SEPA membership could reduce costs from the current 20-50 euros ($22-55) per transaction to some 2-3 euros.
When the European Commission presented its New Growth Plan For The Western Balkans late in 2023, one of the main aims was that the six hopefuls in the region would join the EU in the coming years. Speaking in Slovenia last week, European Commission President von der Leyen raised expectations that three of the countries -- Albania, Montenegro, and North Macedonia -- could join SEPA by the end of the year. This is ambitious given that the respective national banks of the three countries only submitted their official applications for SEPA membership in June and July of this year. Normally, membership assessment takes about a year, and then it takes another six months to be fully connected to the system.
Drilling Down:
- Moldova, however, could well pip the Western Balkan trio at the post. Chisinau filed its application in January of this year and appears to have all the legislation in place to get the green light soon.
- Serbia has "pre-applied" for membership, and its full application should come later this year.
- Ukraine is lagging somewhat behind, but, according to officials in Kyiv, there is a plan to submit the application in the second quarter of 2025. The delay is due to Ukraine's parliament first needing to pass several pieces of legislation, most notably on strengthening the fight against money laundering, and a working group is only now being formed to draft the necessary legislation in that area.
- But what is actually needed to join SEPA and who decides? Decisions on membership are taken by the Board of the European Payments Council (EPC), which is an international nonprofit organization. So SEPA is not actually an association of countries but more of a European community of payment services providers. It is the board of EPC, currently consisting of 30 members, that decides via consensus on membership. The board looks at numerous things. First and foremost, the applicant should show that the country or territory from which it operates has strong economic links and legal relationships with the EU. Considering that all the applicants are official EU candidate countries, this isn't much of a hurdle.
- But then it gets a bit harder. The prospective member country must align with EU rules when it comes to supervision of credit institutions and investment firms, as well as all the necessary anti-money laundering and anti-terrorist financing. While many of the countries that want to join have these sorts of laws in place, the main goal of the EPC board during the assessments is to see if those laws are actually working, and if they are compatible with the normally more stringent EU laws.
- In the final part of the process, the EPC will refer the issue of membership to the European Commission to check if it has any objections. Normally this is just a formality, and it is likely that the EU executive will have a few of those requests later this year.
Looking Ahead
September 11 is another big test for the EU sanctions regime against Russia. The General Court of the European Union, one of the two key courts that make up the Court of Justice of the European Union, will rule on whether the restrictive measures imposed on Russia's National Settlement Depository (NSD), its central securities depository, and a number of Russian oligarchs, including Gennady Timchenko, Petr Aven, and Mikhail Fridman, are legally sound.
While Aven and Fridman have already won in the general court, the two men have remained sanctioned as their legal win concerned another time period, and the EU since then has updated the reasons for their blacklisting.
That's all for this week! Feel free to reach out to me on any of these issues on Twitter @RikardJozwiak, or on e-mail at jozwiakr@rferl.org.
Until next time,
Rikard Jozwiak
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