What happened?

During the corona crisis, France and Germany have joined forces in setting up a European recovery fund of €700 billion. There is much debate about the design of the fund (e.g. size, grants vs. loans), as well as the discord between member states and the possibility of further European integration. But on closer inspection of the proposal, there’s something else that catches the eye as well. The idea of “European sovereignty”, here imagined as support for industrial champions and protectionism against strategic investments from China, is gaining momentum. How should this be interpreted?

What does this mean?

In the twentieth century, the EU saw itself mostly as a “post-sovereign power” and imagined a world in which international governance (in the form of multilateral institutions) would create a new type of order – a world no longer subject to the power politics of superpowers. However, the idea of European sovereignty, which champions “strategic autonomy” against the U.S. and China, in fact points to a Europe poised to engage more in power politics and partly take leave of its “multilateral dream”. Is the notion of European sovereignty a productive idea for the future of Europe?

What’s next?

It is likely that France and Germany, to provide a lifeline to the EU in light of a deep crisis and hegemonic conflict between the U.S. and China, will launch more initiatives to create European sovereignty (e.g. supporting industrial champions, protectionist policy). However, although this would strengthen the strategic position of Europe, it is highly likely that internal tensions will rise. Smaller EU members will always be vigilant about French-German projects to reform the EU. The resistance of the “frugal four” in the coronacrisis is the writing on the wall. If France and Germany take too little account of the interests of smaller EU members, Euroscepticism will grow in the coming years.