The EU emphasized the importance of studying further the policies and regional agreements that could foster South South investment flows.

Taking into account such poor policies and averaging all macroeconomic models, the EU is more likely to pay around 280 billion per year to avert 10 billion in damage. In other words, the poor design of EU climate policies triples the cost and prevents only three cents of climate damage per dollar spent.

Merkel also demanded a stifling and undemocratic EU fiscal straightjacket, which the Commission duly enforces. So when voters throw out a government, EU fiscal enforcer Olli Rehn immediately insists that the new administration stick to its predecessor s failed policies, alienating voters from the EU and pushing them toward the extremes.

This is the crux of the Lisbon Treaty, which is designed to usher in new institutions and mechanisms aimed at creating more politically cohesive EU external policies. Transferring more areas of responsibility, such as foreign aid and development policies, to EU institutions helps the Union to adapt to new international realities by underpinning its growing importance as Europe s decision making center.

Any future European finance ministry would oversee the surveillance of both fiscal policies and competitiveness policies, and, when necessary, impose the second stage. Moreover, it would carry out the usual executive responsibilities regarding supervision and regulation of the EU financial sector.

The EU has an agency called Frontex to coordinate and strengthen national border control policies. But governments have not allowed it to issue directives to national agencies.

The EU is equally unlikely to change dramatically its development aid policies towards Pakistan. Questions of capacity, corruption, and quality assurance remain unanswered, and with the US granting 1.5 billion a year for five years, any change in the EU stance would be relatively insignificant.

The EU would invite non EU states to do likewise

Media stories have focused on the paralysis that is said to have gripped EU decision making, but the reality is different. Far from suffering an irreversible decline in its fortunes, the EU has been has been conducting business as usual, quietly getting on with the job of constructing new policies and projects.

In Europe proper, a union between Russia and the EU should be founded, based on a common economic space, a common energy space with cross ownership of companies that produce, transport, and distribute energy and a common human space that would be visa free and include coordinated Russian and EU international policies.

US President Barack Obama promised that policies to combat global warming would create five million new green jobs. The EU claimed that green energy would help improve the EU s security of energy supply.

In the context of that draft resolution, the EU would like to emphasize its and other States' well known position on the importance of respect for human rights in all counter terrorism policies.

After all, those reforms, together with the previously mentioned economic policies, should pave the way to boosting Croatia's growth potential, to fulfilling the MDGs, as well as to bringing us closer to EU accession.

EU PROPOSAL

On top of that, let us make a major leap of imagination and suppose that even though this scenario of the EU at Year Zero means we would not have a half century of intra European cooperation to draw on, the nations that today make up the EU would nevertheless be keen to adopt far reaching joint policies.

In areas such as policing, the rule of law, and counter narcotics, EU states have pursued policies entirely independently of each other. The EU Police Mission (EUPOL), launched in June 2007, was meant to address this lack of coordination, but in the end its focus was narrowed to police reform, with the Commission funding a separate judicial program.

The real risk concerns the potential for bad political choices to make climate policies worse than necessary. The EU did not just implement a single carbon market in order to meet its target for CO2 emissions.

That insistence reflects the attachment of policymakers in the EU especially in Germany to a conceptual framework that has led them consistently to underestimate the gravity of the situation and recommend policies that make matters worse.

Again, I think that the EU is leading the way in developing countries with development policies that promote broad based rural economic growth by boosting primary production and increasing its efficiency. Indeed, by promoting agricultural practices and technologies that are environmentally sustainable and raise rural incomes, these policies also stimulate rural non farm activities.

These labor market and immigration policies should become the focus of policy coordination within the EU. By concentrating on policies to sustain integration while at the same preserving the European social model, the European Council would again become a relevant policy forum where the real needs and hopes of citizens could find effective responses.

Policies on migrants are becoming increasingly tough, especially in those countries that already had the most restrictive provisions. Since 1995, there were 26 reforms of migration policies in the EU 15 two thirds tightened regulations by increasing procedural obstacles faced by visa applicants, reducing the duration of work permits, or making family reunification more difficult.

These policies include a cap and trade initiative known as the Emissions Trading Scheme, steep fuel taxes, and ambitious programs to build windmills and other renewable energy projects. These policies were undertaken at a time when the EU economy was doing well and one hopes with full knowledge that they would have significant costs.

Blair s EU disaster

Post EU Depression

EU European Union

A sense of fair play also matters within the Union. The larger the EU gets, the greater its need for coordinated and coherent policies, and the harder it becomes to rally all members around a common position.

Change is rendered more difficult by the insufficient democratic legitimacy of EU bodies. The lack of a direct relationship with Europe s people deprives these bodies of the pressure required to bring about rapid action and responsive policies.

In focusing on summit declarations and promises of far reaching reforms of EU institutions, investors are missing the real risk the collapse of public support for, or at least public acquiescence to, the austerity policies required to work down heavy debt burdens and for the governments pursuing these policies. Mass anti austerity protests are one warning sign.

That was true five years ago, but it is much less true today. As Eastern European countries become more closely integrated into the EU, they increasingly have to calculate the impact of their policies on relations with Europe.

Co ordination of national migration policies will remain a dream if decisions continue to be kept under the exclusive responsibility of national governments. There is no sign in the EU that national regulations on economic migration are converging.

Moreover, if we want the EU to emerge strengthened from the crisis, it must also strike a better balance between austerity and pro growth policies, because, without growth and higher employment, the eurozone s problems cannot be resolved. More importantly, the EU must tie its economic strategies to long term competitiveness, which is ultimately determined by the value added to goods and services.

Britain s Last EU Straw?

A Better EU Budget

Politicizing EU Competition Policy

Righting the EU Constitution

The EU vs. Democracy

Statement of the EU

The EU needs a well defined energy strategy that helps to overcome the trust deficit that is hampering effective solutions. This means, first and foremost, establishing clear and predictable community rules and cost sensitive policies for the energy union.

Of course, a common EU security strategy is not meant to undermine the rights of individual member states to choose their internal energy policies. But collective energy security requires increasing the EU s ability to face and face down external energy challenges.

Those problems are real, but their solutions lie in the new vistas of the enlarged EU more trade in goods and services, integration of markets and better allocation of capital, and the potentially disciplining effect of economic unification on economic policies.

Latvia is already projected to lower its emissions by 46 by that date, even without implementing any additional CO2 reduction policies. Indeed, the new EU members are projected to reduce their greenhouse gas emissions by at least 21 by 2010.

This is why the Lisbon Treaty is so important. The provisions in the chapter on democratic principles, which concern the EU s institutions and procedural functions, lay the groundwork for a system that is more open to public debate on EU policies.

The Challenges Of EU Enlargement

26 http europa eu un.org.

Enlargement should also give fresh impetus to policies to tackle deep seated structural impediments and reverse sagging income prospects. The Lisbon Strategy adopted in March 2000 set an ambitious course for the EU, calling for greater focus on research and development, completion of the internal market, bold education and employment objectives, and promotion of active aging, all supported by appropriate macroeconomic policies.