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Dublin: 21°C Sunday 14 August 2022

Opinion: The State of the European Union: why it matters for Ireland

Alexander Conway outlines why we should be listening to Ursula von der Leyen’s State of the Union address tomorrow.

Alexander Conway

IRISH PEOPLE CONSISTENTLY rank among some of the most pro-EU in the Union. Yet as a country we are seemingly unconcerned by what is perhaps the most important policy speech many of us have never heard of: the annual State of the Union speech by European Commission President Ursula von der Leyen.

Every September since 2010, the President of the European Commission delivers an address before the European Parliament, taking stock of the past year, and outlining the Commission’s priorities and ambitions for the year ahead, much like the US President’s State of the Union before Congress.

This year’s speech, taking place tomorrow morning, will be an opportunity to outline the ambitious reforms and aspirations which will shape the EU for the year ahead. And though its precise contents are kept under lock and key until the day, there are some significant policy developments to watch out for which could have seismic impacts on Ireland.

Climate action and the EU’s sustainable recovery post-Covid, tackling the EU’s reliance on external partners and the future of the European economy are among the key issues that are expected to be discussed.

Amid continued wrangling over the implementation of the Northern Ireland Protocol, however, with the UK government, the DUP and others demanding its renegotiation, Irish ears will be waiting to hear what President von der Leyen has to say on Brexit and future EU-UK relations.

Tackling climate change

The EU has tasked itself with the ambitious goal of becoming a carbon-neutral continent by 2050, and reducing its greenhouse gases by 55% by 2030, compared to 1990 levels.

The EU’s “Fit for 55” legislative package is an ambitious bundle of proposals that will demand a total reimagining of how European countries, including Ireland, generate our energy, run our economies, heat our homes, produce our food and travel.

How exactly Ireland will achieve these targets is up to its national Government. An updated Climate Action Plan is expected this year, but there are already several challenges on the horizon.

There are likely to be difficult discussions over how Ireland can reconcile reducing its agricultural emissions, which accounts for approximately 30% of total greenhouse gas emissions, with plans to expand agri-food production. As an island nation, there may also be consequences for travel too if aviation fuel taxes are introduced and subsidies lifted.

Expansion of data centres in Ireland may undermine our energy security if they end up consuming one-third of Ireland’s electricity supply by 2030 and impacting the provision of clean energy supplies, as suggested by a recent Eirgrid report.

President von der Leyen’s address is likely to outline how the Fit for 55 measures can help address these issues, and how to make our air cleaner, our cities healthier and more liveable, protect our rich biodiversity and achieve sustainable green economic growth.

A proposed European Carbon Border Adjustment Mechanism, which would tax imports by incorporating their carbon emissions into their costs to prevent carbon leakage, could address the costs of carbon globally and incentivise cleaner production standards worldwide and ensure a level-playing field for EU industries on the global stage, a boon for a highly globalised, trade-dependent economy like Ireland.

Further moves towards EU security and defence cooperation

The fallout from the ongoing situation in Afghanistan has provided the extra impetus to EU debates over the risks of its military dependency on the US. For Ireland, its dependence on EU partners, as well as the UK and US, was evident in the scramble to airlift Irish citizens out of Kabul as it fell to Taliban control.

This is part of a much wider challenge facing the EU as it aims to reduce its reliance on external partners, like China or the USA, and to act more autonomously in the world. One possible challenge for Ireland, and a concern that has lingered for some time, is the unclear end goal of greater European security and defence cooperation, and how this might affect Ireland’s long-standing policy of military non-alignment and neutrality.

Ireland’s policy of military neutrality is of course guaranteed within the EU, but a more assertive ‘Global Europe’ may offer opportunities for Ireland to protect and promote our shared values within the EU, in our immediate neighbourhood and beyond.

Concerns for Ireland’s economic model

As Europe seeks to reduce its dependence on external partners, Ireland is keen to ensure that any moves towards a more ‘strategically autonomous’ Europe will preserve the global, open rules-based trading system from which countries like Ireland benefit greatly.

In the early months of the Covid-19 pandemic, the EU’s reliance on third countries for strategically sensitive sectors like medical equipment and pharmaceuticals was highly evident. This has accelerated EU moves towards self-sufficiency and this can be particularly difficult to achieve without resorting to protectionist measures such as tariffs on imports or subsidising EU companies.

The State of Union will likely explore how the Commission plans to thread this needle of an open, yet independent EU in the world.

Through initiatives such as GDPR, which has impacted all of our lives and protected our privacy, the EU has become a global leader in technology regulation. However, regulation is not the same as innovation, and in an age of global technological competition between the US, China and others, Europe increasingly seems to be a global referee. As one expert put it, however, “referees tend not to win matches.”

Considering the increased pressure for a global minimum corporate tax rate, one could make an argument that Ireland’s existing economic model, a sizeable portion of which relies on foreign direct investment (FDI) from US companies, is increasingly under threat. How Ireland engages and navigates this discussion at a European level could have long-lasting implications for Ireland’s economy and society.

The State of the Union will likely give an inkling into how the Commission views the future economic shape and trajectory of the Union and for Ireland.

And Brexit, of course

Finally, while little has changed about Brexit and the status of Northern Ireland in recent months, the unilateral extension of the Northern Ireland Protocol has been met with muted recognition by Brussels. During the Brexit negotiations, the EU’s Member States appointed the European Commission as the key interlocutor and negotiator with London, rather than national capitals.

The Covid-19 pandemic, climate change, US-China tensions and growing concerns over a potential new migration crisis on the EU’s southern and eastern borders means that EU-UK relations have been put on the backburner.

However, this does not mean that questions over equivalence for the transfer of data and information between the EU and UK, financial services, trade in agricultural goods and professional services have been settled. As the Member State most affected by Brexit, Ireland’s diplomatic efforts to keep European attention on the future relationship with the UK will remain a key focus, and the State of the Union could indicate how our European partners view the future of relations with our nearest neighbour.

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The State of the Union is a moment of reflection, a chance to look back at where we have been and where we wish to go in future. Each January countless column inches are devoted to the US President’s State of the Union speech, though that speech may have little impact on our day to day lives in Ireland.

Conversely, measures announced in tomorrow’s speech by Ursula von der Leyen will likely have an enormous impact here at home. Careful attention tomorrow will shine a light on what that impact might be.

Alexander Conway is a Researcher for the Global Europe Project at the Institute of International and European Affairs (IIEA), focusing on internal EU policy developments and the EU’s role in the world.

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