Saturday, December 31, 2005

Dispute with Deep Implications

I'm not certain that the decision-makers in the Kremlin have fully taken into account all of the consequences of their handling of the gas dispute with Ukraine.

In 2006, Russia takes over the chairmanship of the G8, and President Putin has already announced that energy security will be one of the key issues at the June summit in St Petersburg.

This is part of presenting Russia as a reliable supplier of energy to Europe, the US and Japan inte the decades ahead, and of attracting foreign investment into these state-controlled sectors of the Russian economy.

But if Gazprom really cuts supplies to Ukraine tomorrow, they will also cut part of the credibility of these efforts. There will not be a chancellery in the West that would not think twice before making their country overly and only dependent on energy supplies from Russia in the years ahead.

Many analysts already fear that the dispute provides a foretaste of how Russia will use its massive oil and gas reserves as a foreign policy tool in future disputes with the West.

Energy co-operation has replaced military might as the mainstay of Russia’s international credibility,” Chris Weafer, chief strategist at Alfa Bank in Moscow, said. “It is using its importance as an energy partner to pursue its geopolitical and foreign policy agenda.

Gas politics has suddenly become the new geopolitics.

The conflict with the Ukraine has deep implications for the future of Europe.

The Kremlin certainly knows that it has strong cards in its immediate dispute with Kiev. But the stronger it plays these cards, the more it weakens its more long-term cards versus the entire West.

Kiev Ukraine News Blog

Friday, December 30, 2005

First On Podcasting

There has to be a first with everything in life, and now it seems as if it is Nicolas Sarkozy in France who is the first senior politician to enter the podcasting world.

Well, if we should be correct it isn't really he who has done it, but there mere fact that he is interviewed by a blogger who then is podcasting the entire thing seems to have created a stir at the least in France.

But there is no doubt that he will not be the last.

The new technologies are busy transforming the media landscape, and accordingly they will affect the political landscape as well.

Sweden was long seen as in the forefront of most of these developments, but I'm far less certain that this is still the case. There is a distinct lack of interest in what the new technologies can offer on the political scene at the moment.

We'll see when it changes.

I'll certainly take note when we have the first more senior politician in the Nordic world entering the world of podcasting as well.

Loic Le Meur Blog

Critical Debate in Turkey

It's encouraging to note that the debate is intensifying in Turkey itself over Article 301 in its penal code and the use that reactionary elements in Turkish society are now making of it.

To change the law is unlikely to be an easy process, but it is obvious that provisions like these have no place in a modern European democracy.

Once upon a time I guess the paragraphs was written in the belief that it would protect and strengthen Turkey.

But that was in old times. In our times, it should be obvious to each and everyone that it is exposing, weakening and damaging the country.

And that is not good either for Turkey or for Europe.

BBC NEWS | World | Europe | Turkish press attacks insult law

Thursday, December 29, 2005

Coming Crisis with Turkey

One of the safest predictions for the coming year is that we are heading towards a crisis in the accession negotiations between Turkey and the European Union.

For this there are a number of reasons.

One is the shift in the European Union itself, where more Turkey-sceptical forces will be more in control of the process during the period ahead. It's difficult to see the Austrian presidency make much to help move the process forward, and the German presidency in the beginning of 2007 will not be too helpful either.

There will, accordingly, hardly be the helpling hand needed to smooth out the different difficulties ahead, thus increasing the risk that they develop into crisis.

But then there are the issues of substance.

One concerns the wave of legal proceedings using the infamous Article 301 of the Turkish penal code that has been launched by conservative and anti-European forces in Turkey recently, the most prominent of which is the one against author Orhan Pamuk.

These are deliberate efforts to throw sand in the machinery, and there is no doubt that it is making Turkey great damage at the moment.

Not everyone understands that these are actions by rather extreme groups, with the government of Turkey as appalled as most others. But in any system with a separation of powers, the judiciary operates independently.

The possibility that is there - and that Foreign Minister Gul has now alluded to - is of course to change the relevant paragraphs in the law.

That would be a wise steps by the democrats of Turkey. It wouldn't hurt if this leads to a review of whether there are similar pieces of old legalislation still existing among the present members of the European Union. That is by no means excluded.

The more serious and direct crisis ahead relates to the unresolved issue of Cyprus. Here, the efforts to reach a solution under the auspicies of the UN were sabotaged by the present Greek Cypriot leadership, and they have since continued their essentialloy obstructionist course.

One consequence of this is that the plans of the EU to help also the people in northern Cyprus, and open it up somewhat to the outside world, have been completely blocked. This has been the policy of both the European Commission and successive Presidencies, but has been vetoed by the Greek Cypriots.

It's hardly surprusing that this in Turkey has been seen in less than positive light. In fact, they see it as the European Union has broken a promise.

And this in its turn has lead to rather strong opposition to Turkey allowing Greek Cypriot ships to enter its harbours. Under the existing customs union protocol, there is no doubt that they have a duty to allow them, but now there is a risk of the blockage of the Cypriot question leading to a blockage of this issue and this leading to a crisis in the overall relationship.

Well, risk is too vague a word. Certainty is more appropriate.

And that will come as the Union has to address also the difficult enlargement issues in the Western Balkans.

The post-Ottoman area will make itself known on the European political agenda in the year ahead.

Turkish FM criticises legal action against European lawmaker

Galileo and China

The launch of the Galileo test satellite was evidently a big news item across the world.

One reason - which I did not mention in my blog entry on the subject - is the fact that a network of global collaboration now surrounds the project.

China is one of the nation that has deceided to join Galileo, and it was then hardly surprising that the launch is big in much of the Chinese media as well, as illustrated by this link to China Daily.

Galileo transforms the world - well, eventually, since it is by 2008 at the very earliest that we will see the real thing starting to work up in space.

Galileo shows peaceful technology pursuit

Wednesday, December 28, 2005

Small Step for Europe

I was happy to note that yesterday the first test satellite for Europe´s coming space navigation system Galileo was placed in orbit from the Russian launch site at Baikonur in Kazakstan.

It's a small first step in the deployment of a system that will have major importance in the decades ahead.

There is of course already the US GPS system in operation. Funded and operated primarily by the US Navy, it was optimized from the beginning for military applications, although it has now also been opened up for civilian use.

The Galileo system is different in that it represents a later generation and is optimized for a large number of different primarily civilian applications. It will be Europe’s own global navigation satellite system, providing a highly accurate, guaranteed global positioning service under civilian control.

To add to the global advantage, it will be inter-operable both with the GPS system and with Russia’s Global Navigation Satellite System (Glonass). Galileo will deliver real-time positioning accuracy down to the metric range with unrivaled integrity.

An enormous number of applications are planned for Galileo, including positioning and derived value-added services for transport by road, rail, air and sea, fisheries and agriculture, oil prospecting, civil protection activities, building, public works and telecommunications.

Some years ago, I headed a so called wise men's group reporting to the European Space Agency on the future direction of Europe´s space activities.

Then, the idea of Galileo was still in its infancy and by no means uncontroversial. But our group was strong in our recommendation to go ahead with the project, and thus made our contribution to what we are now seeing starting to shape up.

In the meantime, most of the opposition to the project has been overcome. For a fairly long period, the US Departement of Defense was very keen on trying to kill the entire thing since they saw it as a threat to their dominance of these issues, and were not certain that they could either control or neutralize the system in a conflict situation or in a conflict zone. It was - in the political sense - a rather brutal battle that was played out.

But that issue has been sorted out to mutual satisfaction, and the DoD has now accepted the new realities. Everything in the world isn't warfighting - and this system is primarily for the civilian sector.

The launch yesterday was a small step for Europe - but potentially a most important one.

ESA Portal - First Galileo satellite on orbit to demonstrate key technologies

Tuesday, December 27, 2005

A Poorer Kremlin - and Russia

Andrei Illarionov has been Economic Advisor to President Putin during his entire period, and has been a sign that there has after all been room for some internal policy debates also in the Kremlin.

Andrei has been and remains an outspoken man. He fought - wrongly, in my opinion - against the present scheme for transforming, modernizing and privatizing the entire electric power system of Russia. He was equally adamant in his opposition to Russia signing the Kyoto protocol - in his opinion the country simply wasn't ready for it.

But these were points on what in the great scheme of things were more more marginal issues. It was when he publicly started to take issue with the arrest of Khodorkovsky, the dismantling of Yukos and the trends towards de-democratization that he got into hotter water.

Now, it is obvious that he has reached the end of his career in the Kremlin. In Moscow today, he has announced that he has stepped down since he can no longer freely express his views on the policies that he increasingly disagrees with. In reality it is obvious that he has been dismissed.

But his voice on the future of Russia is an important one and should be heard. He is deeply concerned with the need to make his Russia truly a part of the modern world - and sharply critical of the now dominant trend of economic policy thinking in the Kremlin.

Earlier this year he wrote that "it dreams of imposing state control over money flows in the fuel sector, nationalizing it,putting under control its infrastructure, keeping up infrastructure monopolies, and managing energy resource flows inside and outside the country."

This is not the Russia he wants - since such a Russia will fail to modernize sufficiently, and risks being dragged down by the magnitude of the challengess it faces in the decades ahead.

Neither is it the Russia that is in the interest of the rest of Europe. We want a modern, open and successful Russia - not a stumbling, closing and failing one.

The Kremlin will be a poorer place without the honest voice of Andrei Illiaronov.

I hope voice will be more heard in the open and public debate on the future of Russia.


Monday, December 26, 2005

Weblogistan versus Ahmadinejad

Iran's hardline new President Mahmoud Ahmadinejad continues to make headlines with his increasingly outrageous statement, most recently that the Holocaust was no more than "a myth".

At the same time, the issue of the nuclear ambitions of Iran is high on the international agenda. There has recently been a resumption of low-level contacts between Teheran and the European Union to see if there is any possibility of resuming negotiations over the issue.

In Iran itself, the fast expansion of "Weblogistan" is an increasingly important development. It is estimated that there are already mjore than 100 000 weblogs in the country. As Western music is banned, the Internet and Weblogistan is expanding veryt fast.

Farsi is the 28th most spoken language in the world, but according to the linked report might be well on its way towards replacing French as the 2nd most common language in the blogosphere.

Sooner or later, there is change coming to Persia.

Opinion - Ben Macintyre Times Online

Russian Gas War Against Ukraine?

The new year could well beging with an open and dramatic gas war between Russia and the Ukraine. If Gazprom turns off the gas supplies to Ukraine - as it is now threatening to do - the effects for the country will be very serious indeed.

On the surface it's all a dispute about prices.

At the present, Ukraine pays the state-controlled Russian energy giant a price of 50 dollars per 1.000 cubic meters of natural gas coming through the big pipeline systems.

This is undoubtedly a low price that is more a reflection of old Soviet practices than realistic prices. There is little doubt that Gazprom over time has the right to ask for a high price.

But the way the entire thing is handled invites speculation that other interests are more driving in the dispute. What Gazprom suddenly asks for is an increase with more than 400 % to 220-230 dollars from January 1st. This would be an immediate transition to the price level of Western Europe.

There is no doubt that this would have a very severe effect on the energy-thirsty Ukraine economy - and it can hardly be a cdoincidence that this will happen just before the crucial March election.

Russia says that Ukraine is now an independent country and would have to pay accordingly. But beneath the headlines Gazprom has signed a new contract with formally equally but more Kremlin-loyal Belarus at a price level roughly equal to what Ukraine is paying today.

It's very evident that some more equal than others.

Ukraine has some cards of its own to play. Close to 90 % of the Russian gas exports to Western Europe passes through the Ukrainian-owned pipeline system running through the country. And Ukraine is now seeking to increase transit fees for Russian natural gas transported via its territory to $3.50 per 1,000 cubic meters per 100 kilometers, up from the current $1.09. With the volumes in question, this already makes for a lot of transit money in the Ukrainian economy.

The pipeline system is the key Ukrainian asset in this drama. And in a move that clearly illustrates this, Moscow appears willing to accommodate Kiev on the gas price if Kiev accepts a loose agreement signed in 2002-2003 on turning Ukraine's transit system into a Russian-Ukrainian consortium, possibly with token German participation.

For Ukraine, that would mean losing control of its key strategic asset in this drama.

As the conflict escalates, there are all sorts of sub-dramas within the big drama.

Gazprom is saying that even if it shuts down supplies to Ukraine on January 1st it will continue deliveries to Western Europe. One does not want a dispute with primarily Germant at this time and over this issue.

But for Ukraine there is always the option of just taking the gas passing its territory and disregard what Moscow is saying.

The potential for a very major mess is certainly there. It might affect everything from the politics of Ukraine and the reputation of Moscow to the heating in Germany.

And it might well have major ramifications for how Europe looks at its future energy supply and security situation.

Gas politics has entered the European scene in earnest.

:: Write to Vladimir Putin: Tell Him What You Think About Blackmail With Gas :: Ukrayinska Pravda

Friday, December 23, 2005

Coming Battle for Jerusalem

In a sunny Rome, everyone is preparing to celebrate another Christmas. Here, it will be the big-time premier of the new pope. Not a small thing around here - and elsewhere.

But it's not only in religious terms there is reason to look towards Jerusalem and the Holy Land these days.

The twin elections to the Palestine and the Israeli Parliament in January and March will shape the political environment that may or may not make it possible to move forward with a peace process.

First is the Palestine elections on January 25th.

As expected, they are hitting problems over the issue of East Jerusalem.

Formally but illegally incorporated into Israel and the rest of Jerusalem, its inhabitants don't enjoy the rights of Israel and are now increasingly being dened the right to be part of Palestine. The Israeli authorities have announced that for the first time no sort of voting will be allowed in East Jerusalem.

This was a tricky issue in the Palestine presidential election last year, and now I guess that the Israeli attitude to some extent is influenced by the fact that there will be the Knesset elections in March.

While President Abbas has indicated that he might even postpone the entire election because of the dispute, the opposition in Hamas seems to want it to go ahead.

In a way it probably suits them just fine. They can agitate even stronger against the Israelis, and they can claim that President Abbas has achieved very little with his more moderate policies. It all plays into their hands - and increases the possibility that they will be the big winners in the election.

If that were to be the case, it would greatly complicate a number of issues. Officially, Hamas is considered a terrorist organisation, and we are not supposed to have anything whatsoever to do with such.

Some in Israel and the US are even saying that Hamas should not be allowed to run in the elections. But in the Iraq elections, even those that had both urged and practized violence against the US and others were allowed to take part. That they did so was even considered as some sort of success - they were drawn into the political process.

So we'll have to see what happens.

Key will be if the White House and the European Union can get Israel to modify its hard line on voting in East Jerusalem. As a bare minimum, they should allow in 2006 what they allowed in 2005.

We have no reason to play into the hands of the extremists.

Jerusalem should be a city of peace.

Haaretz - Israel News - Hamas pushes for immediate elections

Wednesday, December 21, 2005

Global Europe

Those interested in my reflections on the state of Europe in this period of accelerating globalisation can read the speech I gave to a reception at Kreab in London recently.

It's taken some time to get it all down on paper, but since there was a big demand for the text I guess it was worth doing.

There is no doubt that we have been slipping behind in certain respects during the last decade. But we have every reason to point out that our overall achievements during that period have been remarkable in a number of truly important ways.

And even if you look at economic figures, the European share of global exports is holding up well in a situation where Asia increases and the United States decreases its shares.

But it's in and under the impact of its new East that we now see the transformation of the European economy. That's so far a rather underreported story.

The speech is available at my webpage.

As Christmas approaches, a somewhat uplifting message never really hurts.

Tuesday, December 20, 2005

The Missing Link - Sectarian Divisions Confirmed

It's not entirely surprising that the preliminary and partial figures from the Iraqi elections show that the vote went heavily along sectarian and national lines.

This is almost always the case in situations like these.

To build up political parties based on ideas rather than on identity - which are the foundations of most Western democracies - not only takes time, but also requires circumstances somewhat different from those often found in immediate post-crisis or post-conflict societies.

In Bosnia, many had hoped that there would be the emergence of so called non-nationalist groupings after the war. But not only had the politics of the country been split almost totally along so called national lines in the only free election prior to the war, it split more or less along the same lines after the war, and has remained essentially so ever since.

The experience of both Bosnia and Iraq shows that the building of political parties based on ideas rather than identity is the missing link in almost all efforts at state- and democracy-building in fractured societies and regions. And we do not as yet have a good answer.

In Iraq, it now looks as if the Shia United Islamic Alliance will get a support over the critical third of the seats. And it looks as if the more broadly based groups went virtually nowhere. That the alliance between the two Kurdish groups consolidated their hold over the Kurdish provinces was hardly surprising.

Now the Sunnis are talking about election irregularities. But few such were reported at the time. It seems as if we are dealing with a genuine election result.

Genuine - but nevertheless problematic.
Aljazeera.Net - Iraq announces initial election results

Monday, December 19, 2005

Sweden In Charge?

A key part of the EU budget compromise on the financial framework 2007 - 2013 was the agreement to do a review of the entire budget in 2008/09:

"Europeans are living through an era of accelerating change and upheaval. The increasing pace of globalisation and rapid technological change continues to offer new opportunities and present new challenges. Against this background, the European Council agrees that the EU should carry out a comprehensive reassessment of the financial framework, covering both revenue and expenditure, to sustain modernisation and to enhance it, on an ongoing basis."

"The European Council therefore invites the Commission to undertake a full, wide ranging review covering all aspects of EU spending, including the CAP, and of resources, including the UK rebate, to report in 2008/09. On the basis of such a review, the European Council can take decisions on all subjects covered by the review. he review will also be taken into account in the preparatory work on the following Financial Perspective."

There is thus the possibility to do also major changes taking into account enlargement needs, impact of world trade talks or any other factor considered relevant.

The fact that farm spending is likely to take a bigger share of the EU budget in the years ahead than in the past few years is among the factors that should give pause for thought. This was of course the result of lower overall levels of spending while preserving farm support spending.

The agreement says hardly anything about how the review should be done.

But it does mention 2008/09. One possible - I would say even likely - scenario is that the Commission presents its proposal under the review during the later part of 2008, that this is widely debated during the run-up to the European Parliament election in June 2009, and that a decision is taken by the European Council in December 2009.

That's when Sweden has responsibility for the EU Presidency.

The last - and first - time Sweden had the presidency was a period when no particularly challenging decisons had to be made.

This time could be very different indeed. It might in fact be among the most challenging presidencies overall during the rest of this decade.

Whichever government comes out of the elections in September 2006 - it has better start to get itself prepared!


Sunday, December 18, 2005

Christmas Coming!

Behind us lies a week in which things, after all, moved forward somewhat.

There was a budget deal for the European Union in Brussels, as well as an agreement on candidate status for Macedonia. There was an orderly election in Iraq, although the major issues are still in front of the country. And there a limited deal at the World Trade Organisation ministerial meeting in Hong Kong, allowing the global trade talks to move forward.

Forward movement on all of these fronts.

But now I would expect things to slow down. In large parts of the world we are rapidly approaching Christmas. At the least for the Protestant and Catholic Christians - the Orthodox prefer theirs to be a little later.

As for myself, I'll be going to Rome in Italy to spend at the least part of Christmas there. No snow, but numerous other attractions.

There will be time to reflect on other things than the state of the world, the turmoils of Europe or the prospect of politics.

Saturday, December 17, 2005

Yes, the First Merkel Summit

My assumption yesterday evening that this would be seen as a Merkel summit - with new German Chancellor Angela Merkel playing a key role - has turned out to be correct. It's not only in the German media that she is portrayed as having played a key role in actually getting the agreement.

After an interlude of some years we are thus returning to a situation in which Germany is a major player in its own right in Europe. Not simply an annex to Paris, but a player able to play a somewhat broader play.

In the first half of 2007 Germany will have the EU presidency, and the summit in June of that year, presided over by Angela Merkel, will be the one where the newly elected new President of France makes his or her first European appearance.

This is where we should expect the critical decision on how to move forward on the important constitutional/treaty issues. We might well see some discussions on the procedure taken during the upcoming Austrian presidency, but in all probability it will the German one that will be the truly important.

The year thereafter it will be time to do the review of the budget - the financial framework - that now has been agreed to.

By that time we might very well have a new Prime Minister in the United Kingdom, we will certainly have a new President of France and it's far from unlikely that we will have a new Prime Minister of Italy.

In many ways it will be a new ballgame - but Angela Merkel will be there.

So it is probably right to see the meeting of the European Council in Brussels during the last few days as the first in a series of Merkel summits in the European Union.

It's Berlin that will count in Brussels.

Congratulations, Europe and Macedonia!

It was indeed high time to put an end to the soap opera of budget dispute in the European Union. Tony Blair managed to secure a deal on the 2007 - 2013 budget for the Union.

Perhaps these soap operas are unavoidable. It's many different interests coming from 25 member states that have to come together in a unanimous decision. It's distinctly good that there isn't yearly major budget decisions, but instead a multi-year process that then clears the table for a considerable time.

I haven't as of yet had time to look at the details of the budget deal. It's expenditure on the level of 1,043% of the anticipated GDP of the Union. Minute if you compare it with the level of - often much too high - public spending in the member states.

But most important was that candidate status was given to Macedonia. The French lifted their veto.

Macedonia is to be congratulated!

Further steps - as you can see in the text of the conclusions - will be taken in the light of a more general debate in the Union on the future of enlargement. Not necessarily wrong, but very important how that debate is prepared and conducted.

But for the time being we can only note that the European Union has left one drama behind and has kept the perspective of further enlargement open.

Good work, Tony Blair. And Angela Merkel.

87642.pdf (application/pdf objekt)

Friday, December 16, 2005

The Merkel Summit?

Reporting from Brussels indicate that a budget deal might be emerging after all.

There have been intense meetings between Prime Minister Blair, President Chirac and Chancellor Merkel. And obviously these have succeeded in moving some of the most difficult issues forward.

It wouldn't surprise me if this afterwards will be described as the summit of Angela Merkel - the new broker of power in Europe.

Brussels and Balkans

In Brussels it is now hard going over the future of the EU budget. From the outside there are few signs of a softening of the positions, although that was not to be expected at this time.

In the background is the debate about enlargement. The draft conclusions talks about having a more comprehensive debate, effectively on the limits of enlargement, before opening up further accession negotiations.

That might not in itself be bad - it all depens on the outcome of that particular debate.

But it all underlines the significance of the recommendations the Commission will be making on future Balkan enlargement to the informal Balkan summit the Austrian presidency is planning for early March.

My views on what should be done are no secret. The link takes you to a more recent report on them.

B92 >> News >> Archive

After the Iraq Elections

It will evidently take several weeks until there is a clear result from the Iraqi National Assembly elections yesterday.

What we know so far is that they were conducted orderly, that turn-out to vote seemed high and that it was a calm day throughout the country.

And all of that is certainly good news.

It was a true election. There were 7 605 candidates on the lists of the 307 parties or individual lists that were presented.

The election system was in fact very similar to the one used in Sweden. Out of the 275 seats in the Assembly, 230 are elected directly on lists from the 18 different provinces, while the remaining 45 are used to make the overall result as close to proportional as possible.

In political terms the critical issue is how the election went in the four provinces of Anbar, Salahuddin, Nineveh and Diyala which have 45 % of the population and were most of the violence occurs. It's here that one encounters the sharp encounter between Sunni pessimism over the future and somewhat more of Shia confidence.

In itself, the election will do little to overcome this.

Overall, the best election result would be a substantial weakening of the Shiite religious coalition that received 48 percent of the vote in January's election and has dominated the interim government.

Its leading party, the Supreme Council for the Islamic Revolution in Iraq, is closely linked to Iran; with Iranian encouragement, it is pressing to create a nine-province Shiite "region" in the south of Iraq. With its own constitution and security forces, this ministate would be uled by clerics and would control Iraq's largest oil fields. Meanwhile, the Supreme Council's leadership threatens conflict to wipe out Sunni resistance in Baghdad and western Iraq. According to media reports, it is using its control of the Interior Ministry to set up torture chambers and death squads staffed by its own militia.

It is highly likely that the US and others will see to promote the setting up of a more broadly based government that includes substantial Sunni elements as well as the Kurdish parties.

And it's then that one would be able to judge if the political process is truly moving forward. The key will be how a government is formed and how it starts to tackle the major issues.

This will not be an easy process. First there has to be an agreement encompassing thwo-thirds of the members of the assembly on a Presidential Council, and when this is in place it has to task of nominating a Prime Minister. And in the government there is certain to be a hard battle over the key positions.

And then comes all the challenges of substance. Some of them are outlined in the linked article by the US Ambassador to Iraq Zalmay Khalilzad.

It's worth noting that he stresses not only the security challenges, but also those in the economic area. So far very little has been done to move Iraq away from the heavy subsidies and thus de facto state control that was the core of the Saddam control of the economy and thus society of Iraq.

I'm fairly certain that the Constitution will be one of the most difficult issues. It was a very quick deal that was done earlier this year, and it did not resolve some of the most critical issues on the governance of the future. This has to be sorted out.

In a last-minute deal in order to prevent the Constitution from being rejected by the referendum, a review process was promised. The Assembly will form a committee that within four months should present a report with possible changes, and if these are approved by a single majority in the Assembly, they will within a month go to a new referendum.

In this, the changes will be approved if not rejected by two thirds majority in three of the 18 provinces.

This will - no doubt - be highly controversial. And highly important. It will not be easy to get both the Shias and the Kurds to back down even marginally from the substantial gains they made with the Constitution.

But for all the very major challenges that lie ahead, what gives hope is that there now seems to be something that could be the beginning of the emergence of a somewhat more inclusive political process in which nearly everyone takes part.

The optimist could describe that as a slowly emerging democracy.

After the Elections

Thursday, December 15, 2005

The Baltic Pearl

In a speech I gave in London recently I illustrated my thesis on the dynamic developments in the East of Europe with some examples taken from the Gulf of Finland - the key area where the Nordic area, the Baltic countries and Russia comes together.

One of the examples I gave in passing was the impressive Chinese investment in St Petersburg.

The link below shows the details, although I understand that a more recent version of the project means that it will be even bigger.

For up towards 2 billion dollars, a new city for 35 000 people will be built, along with major commercial centers and different public services.

It's de facto a new and very modern town that will rise up by the Gulf of Finland.

Impressive. Who would have believed this 15 years ago?

Multifunctional complex �The Baltic Pearl� -

Eurasian Future?

Polls conducted on different websites are popular, but seldom of any particular interest.

This one is, in my opinion, worth noting.

It's on one of the key websites covering Russian economic affairs. Very well visited in Russian as well as in English.

Asked which country they thought would be Russia's number one economic and political partner in 2025 they overwhelmingly gave their vote to China.

European Union shared the second place - with less than half the share of votes than China - with India, followed by Kazakhstan.

Notable is that Ukraine comes in very low on the list. Perhaps one sees Ukraine moving more firmly into the European Union orbit during the coming years, making it less of a natural partner for Russia.

The impression is clearly of a Russia increasingly turning its attention to Asia.

A Eurasian bloc might slowly be developing.

RBC - RosBusinessConsulting - Your choice

Future European Leaders

As the United Kingdom presidency of the European Union draws towards its end - with the ongoing European Council meeting being the key event - agreement has been reached on which countries are going to be in the presidency for the rest of this decade as well as the next.

Sweden will - which we knew previously - have the presidency during the second half of 2009. This means that this will be one of the key responsibilities of the government that will be formed after our September 2006 elections.

The most interesting presidency during 2009 will be the preceding one, which will be the Czech Republic. The reason for that is that will be the presidency primarily responsible for chosing the person that will be president of the European Commission during the coming five years. But it can certainly not be excluded that this responsibility will spill over into the Swedish presidency as well.

But after that there is no presidency for Sweden on the horizon.

But during the years to come we will see the Baltic countries assuming this heavy responsibility.

Lithuania will be in charge during the first half of 2013. If things go as I would like them to go, this might well be a crucial period in concluding membership negotiations with key Balkan countries. I would like both Bosnia and Serbia to conclude their membership negotiations under the Lithuanian presidency so as to be able to enter as full members by 2015.

Next in line of the Baltic countries will be Latvia, taking over the first part of 2015, then perhaps presiding over a European Union that would have perhaps 100 million more citizens than today. I'm then including Turkey as well.

And then Estonia will be the EU presidency during the first half of 2018.

By then, much will be different. If Estonia is able to keep its present growth rates and its reform path during the years until then, it would then have reached a level of economic development which might well be even somewhat above the average of the member states of the European Union.

Europe is changing - and rather fast.

Welcome to Dinner!

Linked you'll find the formal letter of PM Tony Blair inviting his colleauges to the European Council meeting starting in Brussels tonight.

As you can see, this will be the budget summit, although there will be an element of the Middle East as well.

In addition, there are some issues of VAT rates, with the French holding everything hostage to that as well.

And then there is the seemingly small, but in fact very important issue of candidate status of Macedonia.

This is the last time that Tony Blair will chair a European summit. To a not inconsiderable extent, his place in the history of European integration will be decided by whether he succeeds or fails tonight and tomorrow.

Let's hope that he succeeds.

UK EU Presidency 2005 Latest News

Democracy, Democracy, Democracy

Today is the third time this year that the voters of Iraq are called to the polls in an important election.

Now, it's the new parliament under the new constitution that will be elected. And from this will be formed the first really sovereign government of the new Iraq.

It's encouraging that key Sunni groups that stayed away from the last election now seems to be participating.

But this is by no means the end of the state building efforts in Mesopotamia.

If succesful, it is at the best the end of the beginning.

Polls Open in Iraq As Danger Remains

Wednesday, December 14, 2005

Macedonia Taken Hostage

Although I would expect the issue to reappear when the heads of state and government of the European Union get together in Brussels tomorrow for the crucial meeting of the European Council, it is a fact that it was France that at the meeting of the foreign ministers of Monday blocked giving Macedonia the status as candidate for membership of the Union.

In itself this designation would not necessarily have meant that much. The Commission, which recommended the step, noted that the country is not yet fully ready to start accession negotiationens.

But it would be an important political signal.

First to Macedonia itself, showing that implementing the Ohrid Peace Agreement, signed after the heavy fighting in the country in early 2001, is the road that eventually leads to full European integration.

Secon to the region as a whole, showing that the door to the European Union remains open, but it is dependent on performance on whether one can enter or not.

Both signals would have been of great importance as a critical time approaches in the region.

But France wanted otherwise and said no. French foreign policy seems to be in a rather sorry state at the moment - disoriented after the Non in the referendum, and apprehensive towards a European development it doesn't really control any more.

In public remarks the French foreign minister hinted that it was more of a short-term thing, indicating that in six months time there could be a reassessment of the entire question of an accession strategy for the Western Balkans. Whether this would mean that it would then be no to everyone, or perhaps yes to everyone, was left as unclear as many other things.

And to some extent there is no doubt that France has taken Macedonia hostage to its stance on the EU budget negotiations. Keen to protect its farm subsidies, it's threathening to block everything else.

I don't think this is a policy that long-term protects French interests by creating allies and friends. Rather on the contrary.

And I'm certain that it is a policy hurting the Balkans and Europe's important role there.

Monday, December 12, 2005

A Voice of Experience

In the US, the debate over possible exit strategies from Iraq is getting increasingly intense.

After having been distinctly on the defensive, the administration has recovered some ground with the publication of a policy document on Iraq, while the Democrats have run into trouble when they tried to go from being just negative to shaping a policy line of their own.

Now Henry Kissinger has added his voice to the debate.

Apart from his usual sharp analysis, he seems to me to make two important points.

The first is that too early a withdrawal would have disastrous consequences well beyond the borders of both Iraq and the wider region.

"Our leadership and the respect accorded to our views on other regional issues from Palestine to Iran would be weakened; the confidence of other major countries – China, Russia, Europe, Japan – in America's potential contribution would be diminished. The respite from military efforts would be brief before even vaster crises descend on us. Critics must face the fact that a disastrous outcome is defined by the global consequences, not domestic rhetoric."

In this he is on the same line as the White House in its recent policy statement, but on the second point he clearly is not.

While the administration sees things in a purely military perspective, and says that withdrawal of US forces will be done in accordance with the military judgment of the military commanders on the ground, Kissinger sees this as much too limited perspective.

While it might be convenient from a political point of view to give the responsibility to the local military commanders, the issues are much too political and much too important than that.

Kissinger accordingly wants to see a strategy with a political rather than a military focus. And where the White House talks in terms of a "national strategy for Iraq", Kissinger argues for a strategy that brings in different regional and international political players.

That seems to be wise.

The lessons we have learnt clearly shows that state-building is a profoundly political process, with security no more than the necessary foundation, and that it can never really succeed without being supported in a wider regional and international framework.

Experience is often a good guide to the future. And Henry Kissinger has an abundance of it - in combination with an open mind and a first class analytical talent.

Moving toward a responsible exit strategy in Iraq | The San Diego Union-Tribune

Sunday, December 11, 2005

Slowly Towards Christmas

The coming week is a weeek of most important political events, as I have noted in a previous entry.

Focus will be on Hong Kong, Brussels and Baghdad.

My week will start in Brussels tomorrow with a board meeting of the European Policy Center. It's one of the rapidly expanding think-thanks in Brussels trying to stimulate the debate and dialogue on different European issues.

But then I'm heading for Geneva for two days of different other board meetings dealing primarily with energy issues as well as with developments in Russia.

And then back to Stockholm for more board meetings and to follow the outcome of the Brussels European Council from this horizon.

Quick Impact in the UK

It was expected that the leadership change would give the UK Conservatives a boost in the opinion polls, but it seems to have come earlier and stronger than most expected.

An opinion poll in the Sunday Telegraph today puts the Cameron Conservatives ahead of Labour and on levels where they haven't been for more than a decade. And there is another one in The Sunday Times with more or less the same result.

"We seem to be at the dawn of a new era. There is much work to be done but this is a great start", said the Party Chairman Francis Maude.

A good start it certainly is. And the fact that the appeal of the possible Blair successor Gordon Brown looks like declining adds to it.

Much certainly much work to be done. The Cameron approach so far is stronger on style than on substance.

And on the important European issue, he has started by creating a major mess for himself, his party and his European friends.

Telegraph | News | Cameron's election gives Tories lead over Labour

Saturday, December 10, 2005

Nobel Message from Oslo

Today is the day of the Nobel prices in Stockholm and Oslo. The peace price is awarded in Oslo, and the science and litterature prices in Stockholm.

In Oslo City Hall, the IAEA Director-General El Baradei had just delivered his Nobel lecture. And it is worth reading.

He describes the changing landscape of nuclear proliferation:

"There are three main features to this changing landscape: the emergence of an extensive black market in nuclear material and equipment; the proliferation of nuclear weapons and sensitive nuclear technology; and the stagnation in nuclear disarmament."

And this is not something that anyone of us can ignore:

"Today, with globalization bringing us ever closer together, if we choose to ignore the insecurities of some, they will soon become the insecurities of all."

"Equally, with the spread of advanced science and technology, as long as some of us choose to rely on nuclear weapons, we continue to risk that these same weapons will become increasingly attractive to others."

These are the larger issues surrounding the handling of the more concrete challenges we are facing at the moment in this area.

North Korea continues to stall the six-party negotiations on its nuclear potential. And from the new President of Iran comes a stream of increasingly outrageous statements.

Nobel Lecture: "i"

Friday, December 09, 2005

Interim Plan for Balkans

During the last week I have been in numerous discussions on how the European Union should move forward with its policies in Southeastern Europe.

Some things are moving forward. So called SAA negotiations have now been started with both Bosnia and Serbia.

Other things might be moving as well. The European Council next week ought to follow the Commissions recommendation and give candidate status to Macedonia, although France has been trying stop the entire thing. But when Angela Merkel went to the Elysée Palace for the first time and made clear her support, the issue was evidently settled.

And then there are of course the Kosovo negotiations. Teams are now being formed, and things will start to get more serious in the beginning of the new year.

When we issued the report of the International Commission on the Balkans in March of this year, one of our ideas was to develop a more advanced pre-membership option for these and possible other countries. In economic terms, this should be based on them becoming members of the customs union of the European Union, thus driving trade integration and economic reform.

The case of Turkey since 1996 clearly shows how succesful such an approach can be.

The idea seems to be gathering a certain amount of momentum. in a recent paper, Michael Emerson at CEPS in Brussels takes up and develops the idea, combining them also with the need to do more to facilitate the freer movement of people in the region.

It remains to be seen how ambitious the Commission will be in its approach.

It is now preparing a paper to be the basis for the meeting that will be held in Salzburg in early March under the Austrian presidency. That meeting will take stock of developments in the region and chart the way forward.

Someone has to take the policy lead on these important issues - it remains to be seen if the European Commission will do it.

Book Store

Brussels, Hong Kong and Baghdad

Brussels these days is a city in tense anticipation of the events during the week to come.

The meeting of the European Council on Thursday and Friday is the final show of the UK Presidency, and all depends on whether it will be able to deliver an agreement on the EU budget for 2007 - 2013 or not. Overall, the consensus seems to be that it has been a rather lackluster performance by London during the past few months.

One would be hard pressed to find much support in Brussels for what Tony Blair is trying to achieve. His latest proposal for a budget compromise was blasted by Commission President Barosso for being a budget for a mini-Europe and not the one that we are building.

It's in particular his proposal to scale back on support to the new member states - the so-called EU12 - that has aroused the anger. Blair's meeting in Tallinn and Budapest to get support for his approach seem not to have gone to well. There is widespread talk about "a lack of solidarity".

Be that as it may it is still important to get a budget agreement during next week. One can certainly continue the controversy under the Austrian and even Finnish presidency next year, but that would risk seriously diverting attention from other issues.

And the regular soap opera on the budget is certainly not something that brings Europe closer to its citizens, as is so often talked about.

The leaders of Europe will convene in Brussels only a day after the representatives of the 148 member states of the WTO have gathered in Hong Kong to see to which extent they can move forward the global agenda of trade liberalisation.

Prospects are not too encouraging. Even if there will be a tendency to blame most of European - which means French - reluctancy to go further on the issue of agricultural subsidies, that's too simplistic a picture.

There is also a considerable reluctance among emerging economies to open their markets more to non-agricultural products. These are not exactly poor countries, and it's not unreasonably that they do themselves what they ask of others.

It will be important days in Hong Kong, and the issues are certain to be touched upon during the discussions in Brussels as well.

But also Baghdad will be the object of attention. On December 15th the voters of Iraq will elect their first free and fully competent parliament, out of which the first free and fully competent government will be formed in the weeks and months ahead.

For all the problems of Iraq, it is remarkable that the voters there are now going to the polls for the third time this year. And this time it looks as if all groups will take fully part in the contest for power in the more democratic Iraq.

It will be an important week in Brussels, Hong Kong and Baghdad.

News - Press service - Flash - Statement by Conference of Presidents on the financial perspective

Thursday, December 08, 2005

Gotovina Arrested

It was on Playa de las Americas on Teneriffa in Spain that Ante Gotovina was finally arrested. Indicted by the UN war crimes tribunal for his role in the Operation Storm against the UN Protected Areas in Croatia in August 1995, he has been on the run during the last few years.

With Ante Gotovina eventually transferred to the UN detention facility in Schveningen outside of Den Haag in the Netherlands, the cloud that has been hanging over the Croatian process of accession to the European Union can finally disappear.

That's good news for Croatia - and for the entire region.

I was in Brussels participating in the "Balkan Summit" of Friends of Europe when the news broke. First it was just a rumour, then it was confirmed and then the details started coming.

Serb President Boris Tadic was quick to congratulate Croatia on the arrest, but he was also clear that this means that there will now be increased pressure on his country to really secure the arrest of primarily Radko Mladic but also Radovan Karadsic.

It remains to be seen when ICTY will be ready to start the trial of Ante Gotovina. It will probably take some time for the defence to prepare itself. But there is no doubt that it will be one of the most important and controversial trials of the entire history of this UN war crimes tribunal. Europe

Wednesday, December 07, 2005

New Start in London

It was hardly a surprise that David Cameron emerged the winner when the members of the Conservative Party of the UK had to choose a new leader. Simply speaking, they wanted their own Blair, and with 67% voted for Cameron as the new leader.

His task is to make the Conservative Party a party that can once more be elected and that can govern. That was what Blair did to the Labour party after its turbulent years in the wilderness. Since then, he has won three general elections and seen off no less than four leaders of the Conservative party.

But the success of Blair has at the least to some extent been the result of the self-destruction of the Conservatives. After the Thatcher and Major years it descended into a wild Euroscepticism and tendencies towards imperial nostalgia that effectively made ikt unelectable.

A modern person in Britain simply couldn't be a Conservative during these wilderness years.

The task of restoring thre fortunes of the party is not a small one, and it will take its time. That the election of Cameron was announced the same day as Chancellor Brown had to announce that the UK economy will perferm significantly less well than he so confidently had predicted adds to the feeling of change in Britain.

David Cameron comes to the position after only four years in the House of Commons and no experience whatsoever of governmental responsibility. He is the least experienced new Conservative leader ever, and significantly less experienced than Blair was when he took over Labour.

But in reality he has been along in politics for a long time as political assistance, speechwriter and aide. He knows the political trade as well as anyone. Whether he will master the art of governance must however remain an open question.

So far he has steered clear of any more detaileed policy pronouncements. He clear wants to take the sharp edges of the imsage of the party.

In a most unwise concession to the fanatical Eurosceptics he has indicated that he wants the Conservative members of the European Parliament to leave the EPP group and line up with more marginal and in some cases outright strange groups. We'll have to wait and see what happens with that. A Conservative party that claims to be a serious governance alternative in one of the most important member countries of the European Union can't really deprive itself of influence in Europe.

We'll have to wait and see. I'm just leaving Brussels for London, although I will be back here in the evening in order to be ready to address different Balkan issues tomorrow.

The Conservative Party - Our Key Challenges

Tuesday, December 06, 2005

Growing, Growing, Growing....

New figures coming out of the US economy confirms that in almost every respect it is doing significantly better than expected.

It is impressive:

"The upward revision in productivity reflected the fact that the government last week revised upward overall economic growth for the third quarter to an annual rate of 4.3 percent. It had originally estimated that the gross domestic product was growing at a 3.8 percent rate in the third quarter."

I'm in Brussels speaking at an event focusing on issues of research and innovation in Europe. And my message here is that even though we have fallen seriously behind the US during the last decade, there are measures that can and must be taken in order to improve the situation.

Close to 40 % of the scientist and engineers in the United States that have a doctorate degree are born abroad. The ability of America to attract the best and the brightest from abroad has been one of its key sources of strength.

A significant part of the explanation for this is the superior funding over there. On the average, costs for a student in tertiary education is 2-3 times higher there, reflecting better funding for the universities, making them more able to compete in the global marketplace for talent.

There is no reason why we should not be able to do the same in europe. The sums involved are not vast - but the returns are likely to be.

And we do have advantages that should not be neglected.

Europe now draws on a significantly larger "domestic" talent pool than the United States, particularly after the enlargement of the European Union.

And standards of basic education are generally better than in the United States. In the new member states, and East of them, one very often find impressive standards in terms of basic science, engineering and mathematics.

So the conditions are clearly there.

With the right policies and the right funding we would both be able to use our larger and richer talent pool and be better able to attract the best and the brightest from around the world.

Over time, there is little doubt that this would translate into a more globally competitive knowledge economy in Europe.

And then we could see the European economy starting to grow at the least as impressively as the American one is doing at the present.

Productivity Expands at a Faster Pace

At Least Something...

The liberal group managed to secure three out of the 35 seats in the Moscow City Duma in the Sunday elections.

Official figures gave them 11 percent of the vote, although they themselves claimed that 14 percent was more according to the theuth, claiming different election irregularities.

Not too much. But at the least some liberal voices in some political bodies in Russia.

United Russia Gets 28 Out of 35 Seats

Monday, December 05, 2005

The Week Ahead

Back from the Ukraine and beginning another week. It's dark mornings in Stockholm at this time of the year.

But today I will stay here. Among other things, I'll speak to students at the University of Stockholm at the invitation of the Foreign Policy Association there. I guess we'll discuss where Europe is heading.

And tomorrow I'm off to Brussels to speak about research policy in Europe as well as a number of diverse meetings. From there I go over the day Wednesday to London for an event with Kreab, going back to Brussels late in the evening.

Thursday is the day of the Balkan Summit organized in Brussels by the Friends of Europe, and I'm leading the discussion on economic prospects of the region. Commissioner Olli Rehn as well as Montenegro Prime Minister Djukanovic is on my panel.

It should be an interesting day. Balkans is back on the Brussels agenda. And the issues ahead are not easy.

From there, late afternoon, I'm flying to the United States for a quick board meeting Friday. But then I'm back in Stockholm by lunchtime on Saturday.

Another interesting week.

Sunday, December 04, 2005

Moscow Votes

Today is a snowy and grey day on the banks of the Dnjepr in Kiev where I happen to be at the moment. And I would expect the weather to be roughly the same up in the woodlands towards the northeast where Moscow is located.

Today is election day in Moscow. And every election offer something of interest.

The most interesting fact about this election is that one has banned the ultra-nationalist Rodina party from taking part in it. The reason given for the ban is a TV spot produced by the party that has a clear anti-immigration message.

But that can hardly be the real reason. I haven't seen the TV spot, but I seriously doubt that it is much different from the general level of the message coming from Rodina.

The alternative interpretation is that Rodina - which to a very large extent was a creation of the Kremlin before the last Duma elections - might have been too succesful in the election. It's a child of the Kremlin that one is having problems controlling.

And that unfortunately says something about the political trends in Russia today.

Of interest will be to see how the combined efforts of the liberal reform parties SPS and Yabloko are rewarded by the voters. Together they need to pass the 10 % hurdly in order to get represented in the Moscow City Duma.

If they succeed, it could point to the possibility of them joining forces before the 2007 Duma elections, which would be a most welcome development.

We'll see. In the meantime Kiev is consumed by speculations about it's upcoming March 26 elections to the Rada - the Ukrainian parliament.

More about that later. Today it's Moscow's polling day.

Kremlin’s Hopes Pinned on Moscow Election - NEWS - MOSNEWS.COM

Friday, December 02, 2005

CCTV9 on European Issues

While in Beijing some weeks ago, I did a lengthy interview with China's CCTV9 English-language TV channel.

Coming immediately after the riots in France, it was unavoidable that these issues were high up on the agenda.But I also spoke about issues like democracy in China.

Although I'm presently sitting in Donetsk in the easternmost part of the Ukraine, I notice that the interview is now available on the CCTV website for those that might be interested.

CCTV-English Channel-dialogue

Thursday, December 01, 2005

Tsunami over Rosenbad

Today, an independent commission has issued a report on the performance of the Swedish government in the wake of the tsunami catastrophy during the Christmas 2004 which is unique in modern Swedish history in its criticism of the government in general and the Prime Minister in particular.

The report is a political tsunami sweeping in over Rosenbad, which is the building housing the core governmental functions in Stockholm.

The report details with astonishing clarity how the government was completely asleep at the wheel, and continued to be so for a remarkable long period of time.

For someone with some knowledge of these things the report of the independent commission makes astonishing reading. It was common knowledge that things were bad, but hardly that things were this bad.

We are talking about a profoundly dysfunctional government. And this was brutally exposed in a situation like this.

The Prime Minister doesn't talk to the Foreign Minister. The Foreign Minister doesn't talk to the Deputy Foreign Minister. The civil servants at the Ministry of Foreign Affairs don't talk to the higher levels and don't dare to do anything in the absence of concrete orders.

It's profoundly dysfunctional. And exposed in a way that's just amazing.

One small detail - although an important one - is that of the disputed phone call from the National Security Advisor to the Prime Minister to the Deputy Foreign Minister.

The first claims that he called the later on his mobile phone, on instructions from the PM, to check that things were OK. But the the later denies ever receiving such a call, and has now publicly referred to the logs from the mobile phone companies to prove that no such call was ever received by him.

This is astonishing in itself. Two of the very key persons in handling the foreign and security affairs of the nation are demonstrating in public that they have no confidence in each other.

Even more astonishing is the fact that the Prime Minister has announced that they and everyone else so heavily critized by others will remain in their position. The sufferings inflicted by the tsunami will not be eased by any resignations or dismissals, he says.

That's probably correct.

But equally correct is to note that a dysfunctional set-up of persons just continue at the helm of the nation.

If they couldn't talk to each other before or during the catastrophe last year, they are even less likely to be able to talk to each other after entering having de facto accused each other in public of lying.

The report is the most damming document every issues on the performance of a Swedish government. It is unique in every single respect.

But it's not necessarily an indictment against the Social Democratic party. I know of past Social Democratic Prime Ministers that ran governments far more functional.

It's an indictment against the Persson system of government.

And the core conclusion to be drawn from the report is that this can't be allowed to go on. With the existing set-up of failed persons just sitting there, they are as likely to fail the nation tomorrow as they failed the nation yesterday. - Bakgrund

Soft Power of Europe on the Dnjepr

Today is the day of the summit between the European Union and Ukraine in Kiev.

Everyone from Tony Blair and Jose Manuel Barosso downward are there. And a series of agreements will be signed.

In itself, these will not solve the numerous problems of Ukraine. It's still the March elections that are crucial.

But it does show the prospects that are there for the future.

Tomorrow I'm heading to Kiev and Donetz to discuss the political and economic future of this important part of Europe.

ForUm :: President of Ukraine opens the EU-Ukraine Summit

Soft Power of Europe on the Jordan

Yesterday Shimon Peres took the step of abandoning the Israeli Labour Party that he has been serving for most of his life in order to join Prime Minister Ariel Sharon's new political party.

In his emotional speech, he referred to what David Ben Gurion had teached him on putting duty to the country before everything else. Ben Gurion is something like the founding father of Israel.

But there was one section of his statement that caught my attention more than others. He said this:

"In my conversations with Mr. Sharon, we explored the possibility of expanding the scope of peace and development. In addition to the road map, we will work to create an economic triangle of Israel, Jordan and the Palestinians that may enjoy a special status in the European Union."

I have never heard a vision like this expressed at such a high level and with connecting the possible prosperity zone directly with the European Union.

It is no more than a vision, and one that would take enormous effort to put into reality. But it is truly visionary in tying the economies of Israel, Palestine and Jordan together, and then tying this prosperity zone directly to the European Union.

But clearly it is possible. There is a slowly increasing role for the European Union in the Middle East peace process. And the Union is starting to develop more effective neighbourhood policies.

If these three coming countries can agree, there is no reason why this prosperity zone should not be offered as deep an inclusion in the European economic integration as they want.

The soft power of Europe is starting to be felt on the Jordan.