Sweden braced for 'crisis presidency'[fr][de] 

"I recently read that we are about to face a water crisis too and I thought, why not – let's add that one to the list as well," Prime Minister Reinfeldt said, speaking provocatively during a lunch at the Centre for European Policy Studies in Brussels yesterday (9 June). 

Europe is facing difficult challenges, but Stockholm is ready for them, said Reinfeldt, announcing that his country's presidency would be rather different to what people might expect from a country like Sweden. 

"The Sweden of today is seeking a new, more proactive and positive role within the EU," said Reinfeldt, who did not hide the fact that his government has lofty ambitions regarding European policies. 

However, in order to push the European agenda further, Sweden needs the proper working conditions, the prime minister added, refuting the idea to postpone the appointment of a new European Commission president until after Ireland votes again on the Lisbon Treaty (EurActiv 8/06/09). 

"Sweden will do its part, but we also need a partner in the Commission president and he will be stronger with a new mandate than without," he stressed, noting that current president José Manuel Barroso was the only candidate, proposed by the centre-right and a cluster of socialist governments: namely Spain, Portugal and the UK. "I have only heard one candidate's name so far," he said to journalists after the lunch. 

Handling the financial and economic crisis 

According to Reinfeldt, knowing who will head the Commission will allow the presidency to react promptly to the financial and economic crises, as well as climate change. 

Despite the fact that the Union had done quite well in handling the financial hurricane and the economic downturn, by agreeing on "traffic rules to support the banking system and a joint recovery plan", "the EU needs new measures for a long-term recovery," Reinfeldt said. 

Disagreeing with some analysts, the prime minister refused to cite as an example the successful handling of the Swedish banking crisis of the 1990s. "It took us almost ten years to recover fully from the experience and far too many people ended up in long-term unemployment. We must make sure to avoid that this time," he said. 

To return to functioning financial markets and restore confidence, the Swedish presidency will focus first on delivering a better supervisory system in line with the Commission's proposals, based on the so-called de Larosière report. 

But in order to restore stability, Reinfeldt wants to initiate a constructive discussion on fiscal policies in member states. "We need to agree on a common exit strategy to return to the rules of the Growth and Stability Pact," he said, stressing that the downturn had put significant pressure on national budgets. 

"If the crisis we face today was created by the people borrowing too much, the solution cannot be for governments to act in the same way," he added. 

Fighting unemployment and social exclusion 

To reverse the trend of soaring unemployment, the Swedish presidency is eyeing short-term pro-active labour market policies to maintain employability, but also strengthen innovation to move towards a low-carbon economy in the long-term. 

"As we look to the future, it is clear that Europe needs a revitalised strategy for sustainable growth and full employment - a strategy that transforms our Union and reaps the benefits of globalisation," Reinfeldt argued, saying it will get the debate on the review of the EU's Lisbon Strategy off the ground so that a new vision for Europe can be adopted in spring 2010. 

Not just 'green dreams', but green realities 

Sweden's role will be crucial in forging alliances and pushing for an ambitious global climate deal in Copenhagen next December. 

"Over the last year I have often been told that, in the middle of deep economic crisis, countries cannot afford to spend money on 'green dreams'. I would argue the contrary. They cannot afford to keep their current costly energy sources," Reinfeldt said. 

For the Swedish prime minister, countries can improve their public finances by addressing climate change and their energy mixes. A win-win situation includes substantial mitigation efforts. "Developed countries must take the lead in reducing emissions and reach a mid-term target of cutting emissions by 25-40%," he said. 

The EU has pledged to reduce emissions further than its agreed target of 20% by 2020, if other industrialised countries concur to do the same and developing countries contribute according to their own capabilities. 

CO2 tax: A solution, not an obstacle

In Sweden's eyes, the EU's emissions trading scheme, which covers only 40% of greenhouse gas emissions, is not enough to address climate change rapidly and effectively. "We need a CO2 tax," Reinfeldt said, noting he will relate the positive experience of Sweden. Apart from Sweden, other EU countries levying taxes on carbon emissions include Finland, Denmark and Slovenia (EurActiv12/05/09). 

Since the early 1990s, there have been several attempts to introduce a unitary carbon tax for all EU member states. But an EU carbon tax has never materialised, as countries such as the UK and France were unwilling to render national competencies on taxation to the EU. 

Moreover,  the member states worst affected by the current financial crisis, including Spain, Portugal and Ireland, argued that they would be hit harder by the tax than the more industrialised member states. 

"If they tell me that they have huge deficits in their budget and lack resources, I will tell them this is the most efficient way to reshape the economy in a low-carbon direction," he said, responding to a question from EurActiv. 

Reinfeldt argued that other measures to reduce CO2 emissions are much more investment-intensive and put greater pressure on budgets than a CO2 tax.  

Turkey, enlargement and Eastern Partnership 

According to Reinfeldt, the enlargement of the EU has strengthened the Union, reinforced security and increased Europe's influence on the global stage, while leading to higher levels of prosperity and cultural diversity. 

The Swedish presidency intends to continue accession negotiations with Turkey and Croatia. 

"There are different views on Turkey, but we should stick to our commitments," he said, stressing the crucial strategic importance of the Mediterranean country for energy security. 

Another priority linked to the energy supply is the countries in Eastern Europe and in the Southern Caucasus (Eastern Partnership) as they offer potential for diversifying the EU's energy supplies. 

The Eastern Partnership proposed by Sweden and Poland a year ago to balance France's Union for the Mediterranean will be one of the external priorities of the Nordic presidency. 

"We believe that this initiative can contribute to stability, democratic reforms and increased welfare in our neighbouring countries," Reinfeldt said. Sweden has also been a strong advocate of accelerating the progress of the Western Balkans on the road towards EU membership. The Swedish prime minister reiterated this commitment. 

Guaranteeing security and the rule of law 

Among other priorities is further cooperation in justice and home affairs. Sweden will develop measures to tackle new challenges prompted by a Europe without borders. 

The top priority in this area is negotiating the so-called 'Stockholm programme'. This includes police, border control and customs cooperation, criminal and civil law cooperation, asylum and migration, and visa policy and civil protection. 

Last but not least: the Lisbon Treaty 

Admitting citizens' lack of interest in EU institutional matters, like the ratification of the Lisbon Treaty, Reinfeldt said Sweden will be ready to handle the preparatory work to implement the Treaty once it has been ratified by all member states. "People simply expect the Brussels bureaucracy to function well, and it's our job to make it happen," he said.