November 16, 2011 / 2:30 PM / 8 years ago

Analysis: EU risks reopening Pandora's Box with treaty change

BRUSSELS (Reuters) - If there are two words causing quiet alarm across the European Union right now - beyond the turmoil already convulsing the countries that share the euro - they are “treaty change”.

They may not carry the same drama as “bond market mayhem”, but the very idea of altering the fundamental laws underpinning the European Union so soon after they were agreed runs the risk of shaking the 50-year-old European project to its core and may end up exacerbating the sovereign debt crisis.

German Chancellor Angela Merkel has been the most forthright of Europe’s leaders in calling for changes to the Lisbon Treaty, arguing that amendments are necessary if there is to be more rapid integration and greater stability in the euro zone. The changes she is seeking include much stricter sanctions on countries that miss budget deficit targets.

“It is time for a breakthrough to a new Europe,” she said in Berlin last week, emphasizing that the survival of the EU depended on being able to amend its treaty, even though it took eight years to negotiate and came into force only two years ago.

“A community that says, regardless of what happens in the rest of the world, that it can never again change its ground rules, that community simply can’t survive. I’m convinced of this.”

As has often been the case during the crisis, France has supported Germany, saying treaty change is necessary, although Paris has hinted at much deeper and more fundamental changes than Berlin wants. The European Commission, the EU’s executive, is behind the need for limited changes, although it has caveats too.

“Any revision of the treaty is for deeper integration of the euro area but also for a stronger European Union,” Commission President Jose Manuel Barroso told the European Parliament on Wednesday, a bid to keep the process inclusive of all 27 countries in the EU, not just the 17 in the euro zone.

“But let’s not fool ourselves. Treaty change takes time and should not be seen as the immediate solution for the current crisis,” he said.

Others are even more cautious, including Herman Van Rompuy, the president of the European Council and the man responsible for chairing summits of EU heads of state or government.

Van Rompuy’s concern is that opening the treaty to changes without a very precise idea of why and to what extent runs the risk of everything in the document suddenly being up for renegotiation — not unlike pulling a single thread in a knitted sweater only to see the entire piece of clothing unravel.

In discussions he will have with leaders over the coming month, Van Rompuy will try to define what changes might be needed and only then look at what the legal necessities are.

His aim is to deliver an interim report before a summit on December 9, and a final assessment in March or possibly June next year, a much later deadline than previously envisaged.

“We should examine the goals, and only afterwards the legal instruments to get there, including limited treaty changes, should these prove necessary,” he told the European Parliament on Wednesday using particularly nuanced language.

“A lot can be done within the (current) treaties,” he said, underlining his reluctance for a broad re-opening of the text, before reminding everyone of the biggest hurdle to a successful amendment, and the issue that makes most EU leaders shudder:

“For treaty changes, a unanimous ratification is needed by every single member state,” he said.

IRISH OBSTACLES

That comment harks back to the debacle that surrounded the Lisbon Treaty during its lengthy ratification process in 2008, when Irish voters rejected it in a referendum, a decision that effectively put pan-European integration on hold.

Only a second referendum in 2009, accompanied by intense and costly lobbying on all sides, finally convinced the Irish electorate to back it, allowing the treaty to come into force.

If getting it approved in all 27 countries was hard the first time around, it will only be harder at a time when Europe is akin to a dirty word in many member states and the economic and financial crisis has made almost all voters deeply wary.

Aware of those concerns, Irish Prime Minister Enda Kenny counseled caution during a visit to Berlin on Wednesday, where he held talks with Merkel on the issue.

“Any steps toward major treaty change would obviously be very challenging,” he told reporters afterwards.

“I’ve had a frank discussion about that with the chancellor, and I believe that the immediate crisis has to be dealt with in the short-term with the facilities and the tools that are available to us.”

Britain, which is determined not to adopt the euro and has an increasingly fractious relationship with the EU as a whole, is another serious obstacle, even if the treaty changes were to be minor and only pertain to the euro zone countries.

Deputy prime minister, Nick Clegg, reflected some of the British government’s thinking in a visit to Brussels last week.

“There is a knee-jerk assumption that when Europe faces a major crisis, where the challenge we face is big enough, our default response should be treaty change,” said Clegg, a former member of the European Parliament who is considered one of the more pro-European of Britain’s politicians.

“To sit around tables for months on end, agonizing over this article or that, becoming engulfed in endless institutional introspection, would be a huge political distraction for the economically urgent task at hand, and the danger is that fixating on the treaties will obscure what is really needed.”

In a reflection of just how much of a concern Britain’s position is, Van Rompuy is scheduled to meet Prime Minister David Cameron to discuss the issue in Brussels on Friday, before Cameron visits Merkel in Berlin.

EURO ZONE CONCERNED TOO

But it is not just non-euro zone states who are major hurdles; many of those in the euro zone also fear that tinkering with the treaties at a time when there is an urgent need to tackle the wider issues of crisis is the wrong way to go.

Avowedly pro-European Finland has said it is not enthusiastic about treaty change, even though it cannot be excluded, and the Netherlands has raised its concerns. Slovakia, the Czech Republic and Slovenia are all uneasy customers.

For her part, Merkel is determined to secure treaty change by the end of 2012, a goal that looks decidedly ambitious.

While the treaty has been slightly amended over the past year to allow for the creation of a permanent euro zone bailout mechanism, that was done through what is known as a simplified procedure, which is relatively quick.

Given the changes Germany wants to achieve, which include much stricter sanctions on countries that miss budget deficit targets, it is unlikely member states will agree to the simplified method again.

Plus France is hinting at deeper treaty adjustments that would definitely require the more lengthy, ordinary procedure to be used, and the European Parliament, whose powers were enhanced under the Lisbon Treaty, also wants the ordinary method.

“I’m very concerned, very concerned,” said a senior EU official directly involved in the negotiations when asked about the risks of treaty change at a time when the euro zone risks being pulled apart by financial market forces.

“This is a huge debate to be having. We’ll start with limited treaty change and before we’re even aware, we’re going to be in a debate about the very essence of Europe. It will end up being a referendum on Europe in a very negative climate.”

Writing by Luke Baker; editing by Janet McBride

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