After many of the powers Solana coveted over Europe were included in the once defeated and then resurrected post Irish pressured second vote, he made a surprise announcement just before that second Irish referendum that he was going to "retire." Since nearly every discussion of the World Economic Forum referenced back to redoing or a new "Bretton Woods," I thought I would check in the one place most apt to reflect Dr. Solana's personal thinking on the shape of the "global governance" he has long been at the forefront of -- the statement by Pierre DeFraigne, director of the Madariaga Foundation/College of Europe. The Statement was entitled "Bretton Woods III needs a new G/3." Most of it had to do with Europe needing to speak with one voice -- too many European voices were now being heard, but there was "less Europe" as a result. If Europe spoke with ONE VOICE, it would have far greater impact on the global scene and could assume the powerful role the USA had held in the earlier Bretton Woods arrangements! Equally surprising to me was the powerful criticism of three countries as interfering with the needed changes: Great Britain, Germany, and France."
"This paper compares the international position of the EU and China with reference to the global post-crisis reform agenda. The global financial and economic crisis unveiled the existence of a credibility gap between these two international actors, with Europe finding itself in the uncomfortable position as the weaker party. Nevertheless, the EU is called upon to give a substantial contribution to the setting of new global governance structures for trade, international financial institutions and financial regulation. The challenge now is whether the EU chooses to act as a subsystem of an emerging G2 or build upon its experience of decades of international integration to develop a new model of global governance based on solidarity and sustainability . . .
"The EU-China relationship is a complex one with promising long term prospects, but doomed to be disappointing in the short term. This is less because of genuine conflicts of interests than of misperceptions in the respective public opinions and regular misrepresentations by the media. But the unanimity rule in the EU Council plays also an essential part in the difficulty since it sometimes makes European foreign policy unpredictable. This jeopardizes the EU’s reliability as a partner for China. A huge centralized power like China dislikes being confronted with the uncertainty of a block whose commitments are subject to the veto of one or a few Member-states sometimes vulnerable themselves to the influence of other large powers. Nor can it cope with EU paralysis due to the rivalry among the Big Three –the UK, France and Germany- either still clinging to memories of their lost imperial power or competing for their national commercial interests, but unable to deliver on a reliable and robust EU partnership with China1. . . . The EU will be treated as a strategic power by China only when it achieves its unity and punches its full weight in world affairs. This will take time, but it is likely to happen in the foreseeable future as the crisis evolves and the need for in-depth reforms – a Bretton-Woods III – become more and more pressing.
"From a half-to a fully fledged economic power
"The EU stands on the sideline in monetary and financial affairs contrary to the trade sector where the EU operates as a fully-fledged actor. As long as it has not fully completed its financial market unity and as long as will not have balanced its centralized monetary authority with an effective fiscal coordination, the EU will not enjoy a real monetary, financial and tax sovereignty. Therefore, the EU won’t project itself externally with a common position and speak with one voice and negotiate as a block. Its effective influence will remain far below its economic weight. Moreover if the EU , as a large economic block generating the largest flow of savings worldwide, does not dare to put its financial regulation above the unwritten neoliberal law of letting capital move unrestricted across its borders, it will have to line up its own norms and standards on the G20 minimum consensus. Eventually we are confronted here with a paradox: the EU pleads for multilateralism, but so far it is in no hurry to play as a major actor in all multilateral fora. The bleak picture made here which goes against the official complacency with regard to the EU‘s capacity to be an effective player on the international governance scene, should not lead us to write off Europe altogether.
Three factors will force the EU to resume its march towards further integration and eventually to achieve full unity and subsequent sovereignty. First, the Lisbon Treaty has a limited, but some potential to strengthen the EU’s institutional capacity through built-in mechanisms either by extending majority voting or by dodging the need for achieving a full consensus among the 27.
Second, the emergence of China as a global actor is confronting Europe with a dilemma: either it chooses to act as just an economic subsystem of a US-led OCDE and a regional security system within US-led NATO, and then it paves the way towards a G2; or it means to assert its own unique development model with a higher level of solidarity and environmental sustainability as well as more strategic autonomy so as to project its own vision of a multilateral world order in a G3-plus rules-based multipolar world.
Last but not least, the crisis will be a maker or breaker of the EU’s unity. So far common responses to successive crises have eventually proved beneficial for European integration.