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Reconcilable differences: European neutrality and European integration. The cases of Austria and Sweden: Implications and prospects of European Community /European Union membership

Roberson, Joanne M., M.A. The American University, 1994

UMI 300 N. Zeeb Rd. Ann Arbor, MI 48106

The Cases of Austria and Sweden Implications and Prospects of European community/European Union Membership by Joanne M. Roberson

Submitted to the Faculty of the School of International Service of The American University in partial fulfillment of the Requirements for the Degree of Master of Arts in International Affairs

Signatures of Committee:

Jr,^ U) C h a i “ an: Dean of School i / . /A.______Date: I l°2Cf3> Date: f' Z . f ' l j ? 3 ____

The American University Washington, DC q THE AMERICAN UNIVERSITY LIBRARY ,0u:' 1 0 AMERICAS USIVERSITY LIBRARY

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. RECONCILABLE DIFFERENCES: EUROPEAN NEUTRALITY AND EUROPEAN INTEGRATION BY JOANNE M. ROBERSON ABSTRACT European neutrality and European integration are dynamic processes which represent means for nation states to maintain sovereignty and achieve common or similar goals. Neutrality can preserve the sovereignty and national identity of some states while integration can enable states to keep pace with the growing interdependency of the world. Nevertheless, both are tools which ultimately ensure the viability of each nation state which chooses to engage in either process. Thus, despite the increasingly comprehensive integration of the European Community and the European Union, the continuation of the inter-governmental nature of the common foreign and security policy will allow for reconciliation with neutrality. During the Cold War, Austria and Sweden focused their attention and experience on universal collective security as opposed to ideologically divided defense blocs as members of the United Nations. This experience will enable the Euro-neutrals to be potential leaders in developing any future regional security

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. architecture in post-Cold War Europe. As neutrality is an adaptable process which will continue to evolve by enhancing security through participation in the broader scheme of European integration, so too will the dynamic process of European integration adapt to and benefit from the precepts of European neutrality as the European integration process proceeds "toward an ever closer union."

iii

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. ACKNOWLEDGEMENTS I would like to first thank my thesis committee, Dr. William C. Cromwell and Dr. Amos Perlmutter. Dr. Cromwell, you were the fundamental inspiration behind my education at The American University, and I cannot thank you enough for your encouragement, enthusiasm, and patience. Dr. Perlmutter, you helped me to keep this research in perspective and always shed new light on seemingly resolved issues. Thank you both for taking the time that you did to review and critique my many drafts. Your combined knowledge and insights were invaluable to my analysis. I would also like to thank my husband, Scott, for the endless hours of engrossing discussion and debate, as well as his remarkable patience with my schedule this past year. Scott, you are truly the best. Finally, I would like to thank my parents, who have always encouraged me to be independent, both in thought and in action. Whether you know it or not, you have been the foundation of my inspiration to pursue my goals with the same dedication and diligence which you have shown with such grace and ease as the parents of four daughters. You will both always be a source of awe to me.

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CHAPTER PAGE

I. INTRODUCTION ...... 1 II. THE HISTORY OF EUROPEAN NEUTRALITY AND INTEGRATION ...... 50 III. EUROPEAN NEUTRALITY AND EUROPEAN POLITICAL COOPERATION/COMMON FOREIGN AND SECURITY POLICY ...... 138 IV. THE FUTURE OF EUROPEAN NEUTRALITY AND INTEGRATION ...... 222 V. CONCLUSIONS...... 262 BIBLIOGRAPHY ...... 288

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. CHAPTER I

INTRODUCTION

Out of the crooked timber of humanity no straight thing was ever made. Immanuel Kant, 1784 Purpose of Research In a thesis which hopes to shed light on the largely misunderstood concept of neutrality, it is important to immediately assess which states can and cannot adopt neutrality; what the advantages and disadvantages are in practicing neutrality; and what the consequences are for a nation for having neutrality and not having neutrality. However, any attempt to be so clear-cut runs the risk of over-simplification. Nevertheless, if such a presentation orients the reader to the purpose of the research and the underlying arguments contained throughout the research, then it will not have been in vain. In a world of big and small states, the ability of small states to survive largely depends on external factors beyond their control such as geography and the relative balance of power surrounding them. Moreover, very few states, let alone small states, are able to uphold the burdens of self-sufficiency. Nevertheless, certain small states opt for the policy of neutrality in an effort to

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 minimize the possibilities of becoming pawns of the great powers either during peacetime or during the outbreak of a potential war. As such, neutrality is a tool used by certain small states to make themselves as invulnerable as possible and to reaffirm their self-preservation and national identity. However, neutrality is only one of the components of a nation's security policy, and since it is a means and not an end unto itself, the policy is flexible and can be emphasized or minimized depending on the external environment. In choosing a policy of neutrality, however, it is not enough for a state to simply profess it, and then for it to relinquish all responsibility to itself and others by virtue of its claim. Rather, neutrality has to be reinforced by credibility, supported by the premise of a strong and viable economy as well as a strong and independent defense. This is essential since perception is reality when it concerns the authenticity of neutrality. Consequently, neutrality is not an easily transferrable policy, especially if the goal in its adoption is a "quick-fix" to a security vacuum. Thus, while some small states would very much like to adopt neutrality, they simply cannot because they lack the very premises to make it credible. Moreover, nations which proclaim and practice neutrality are keenly aware of their vulnerabilities and

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 3 their ancillary position within the grander scheme of international affairs. But, in turn, they have also been in a most enviable position since they have been able to economically sustain a credible policy of neutrality and generally partake of the best of both worlds. Nevertheless, a neutral country does not escape from responsibility by choosing to be neutral, rather it embraces responsibility by its commitment to uphold the credibility of its respective policy. The primary advantage of practicing neutrality is that, if practiced credibly, it minimizes the risk of an attack during a potential war. Nevertheless, the risk of invasion remains, even if all the rules of neutrality are followed; it all depends on the tactics of the warring states. Neutrality is also generally viewed as an even- handed and impartial policy, so it also provides a nation with the opportunity to be considered as a mediator during a potential conflict between other countries. The primary disadvantage to practicing neutrality is the prospect that a country can be viewed by other nations as having no opinion at all and preferring to live an existence of isolation. However, this can work to a neutral's advantage as well. A further disadvantage is the tremendous financial obligation needed to uphold credible neutrality by sustaining a strong economy and a strong and independent

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 4 military. The consequences for having neutrality are the responsibility a state has to itself for maintaining neutrality and to others to convince them of the credibility of their policy. Although neutrality is not a policy of isolation or withdrawal, this is often the consequence since it is often misunderstood, or not bothered to be understood, by other states. As such, the consequence for not having it, once it has been practiced and then voluntarily relinquished, is that a nation cannot expect to have this policy taken seriously again by others. This is why it is a particularly delicate subject for nations which have been practicing neutrality for not only decades, but also centuries. To readily relinquish neutrality in "the New World Order" would be to cast a shadow of doubt over what it meant during the years when it was practiced. Thus, the goal of the neutrals is to preserve a back door option through retaining a policy of neutrality in the post-Cold War world; especially since the system which is supposed to ensure stability and peace has yet to be accomplished. Therefore, retention of an evolved or adapted neutrality will be the likely outcome during the post-Cold War era in conjunction with enhanced participation in a changed world.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 5 Background Since I960, western Europe has been primarily organized along economic, political, and security lines into two sets of nations, those which belong to the European Free Trade Association (EFTA)1 and those which belong to the European Community (EC).2 In the comparative regional studies of western Europe it is essential to understand what has traditionally drawn these two sets of nations together and what has traditionally kept them apart. Understanding the broader EFTA-EC relationship is fundamental to this research since the nations under examination, Austria and Sweden, are currently members of the EFTA which have applied for EC membership.3 Traditionally, the links between the EFTA and the EC have been economic with each representing the other's major external trading partner. In contrast, what has traditionally separated the EFTA from the EC has been political and security issues. The most predominant difference between the two sets of nations is that while five of the seven EFTA member states practice a policy of

'Today's seven EFTA members are: Austria, Finland, Iceland, Liechtenstein, Norway, Sweden and Switzerland. today's twelve EC members are: Belgium, Denmark, the Federal Republic of Germany, France, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal, Spain, and the ‘Jnited Kingdom. 3Of the EFTA group, only Iceland and Liechtenstein have not, as of this writing, applied for EC membership. Austria applied on July 17, 1989 and Sweden followed two years later on July 1, 1991. During 1992, three EFTA members applied: Finland on March 18; Switzerland on May 26; and Norway on November 25.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 6 neutrality,4 eleven of the twelve EC member states are members of the Atlantic Alliance. Ireland, the only EC member not affiliated with the Atlantic Alliance, professes a policy of neutrality, and therefore serves as the model for the EFTA neutrals on how to reconcile neutrality with integration.5 Thus, the aspirations of the Euro-neutrals6 to join the EC must be kept in the proper perspective of why each chose to refrain from EC membership when it was created, why they collaborated to develop their own arrangement in the form of the EFTA,7 how far each has come in its respective relationship with the EC, and what has changed to make each want to become an EC member today. Reflecting on these salient issues of the past and present

‘Austria, Finland, Liechtenstein, Sweden and Switzerland all practice neutrality; Norway and Iceland are members of the Atlantic Alliance. ’Ireland was never a member of the EFTA. It joined the EC directly in 1973 in conjunction with Denmark and the United Kingdom which were both founding members of the EFTA. Ireland's neutrality is unique in Europe, and is an issue of intense debate, both inside and outside of Ireland. Indeed, Ireland is rarely grouped with the other European neutral states largely because it chose to reconcile neutrality with EC integration during the Cold War. This is discussed in greater detail throughout this research. ^Austria, Finland, Sweden and Switzerland are collectively referred to as the "Euro-neutrals" (without Ireland and Liechtenstein). It is important to note, however, that each is at a different stage along its respective neutrality path, and can only be collectivized to a certain extent. Both Switzerland and Sweden practiced neutrality during the European balance of power system - Switzerland since the early 16th century and Sweden since the 19th century. After World War II their respective neutrality policies adapted to the bi-polar environment. On the other hand, Austrian and Finnish neutrality originated during the Cold War and was primarily demarcated by it. However all four Euro- neutrals are now responding to the same international changes. ’Finland did not collaborate to form the EFTA largely because of its relationship with the former Soviet Union. Until 1986, when it became a full member of the EFTA, Finland had a special treaty, via an association with the EFTA, known as the "FINEFTA".

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 7 allows one to better comprehend and cogently speculate on the possible outcome of the on-going EC membership negotiations.8 The EC has not explicitly made the abandonment of neutrality a condition for membership, although individual EC officials have declared that "[t]he EC cannot permit itself to be neutralized by the accession of a neutral country."9 Many EC officials also "... view[] neutral members as a threat to political union,",0 especially given the goal of developing a common foreign and security policy (CFSP) designed under the European Union Treaty.11 With these deeper, and more advanced integration goals, it would be logical to expect that it would be even more difficult for the Euro-neutrals to become members of the EC. However, Ireland has been an EC member since 1973, and it has not

*Formal EC membership negotiations began between the EC Commission and Austria, Sweden and Finland, on February 1, 1993. Norway began negotiations in April 1993. Switzerland put its EC plans on hold since the negative referendum on the EEA in December 1992. Accession for the four is targeted for January 1, 1995, but may take until 1996, or possibly 1997. ’"EC'8 Bangemann Views European Integration," Foreign Broadcast Information Service: Daily Report Western Europe (hereafter "FBIS-WEU"). FBIS-WEU-91—001. 2 January 1991, 1. 10"Issue of Country's Neutrality Within EC Discussed," FBIS-WEU-91- 031. 14 February 1991, 27. nThe European Union Treaty (also referred to as the Maastricht Treaty) was ratified by all EC members and went into force on November 1, 1993. The EUT subordinates the EC to being one of the three pillars of the European Union (EU). The two additional pillars are the CFSP pillar (which may include defense), and the internal affairs pillar (which institutionalizes the cooperation amongst the EU's ministries of interior and justice). It is important to note that under the EU, while the strengthened EC and economic and monetary union pillar operates on a supranational level, the other two pillars operate on an inter governmental level.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 8 been required to relinquish its neutrality, even during the Cold War. Moreover, given the three pillar structure of the European Union (EU), the state-dominant nature within the CFSP pillar is preserved with its inter-governmental design, as had been the case for the European Political Cooperation (EPC) formalized under the EC's 1987 Single European Act (SEA). Finally, given the end of the Cold War, neutrality will be able to adapt and accommodate to the emerging European security identity without having to be abandoned.

The EFTA-EC Relationship The story of the developing EFTA-EC relationship is unique in international affairs. Because of the damages of World War II, western Europe had to rebuild itself both economically and politically. The debate over how to go about European reconstruction through integration resulted in the formation of two schools of thought and two sets of nations, one which aspired to develop supranational institutions to oversee its organization, and thus to become more than simply a trade arrangement (the "federalists" and the EC, led by France) and the other which preferred to form minimal institutions and to remain strictly a trade arrangement (the "functionalists" and the EFTA, led by the United Kingdom). Not surprisingly, amongst the "functionalists" were the Euro-neutrals: both the Nordic

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 9 group (Sweden and Finland) and the Alpine group (Austria and Switzerland) .,2 Consequently, before any other region in the world began to consider integrative schemes, Europe, by necessity, was the first to begin the cooperative process of integration between nations. Indeed, the primary impetus of forging such close links was to keep Europe out of another war by linking key industrial sectors and forging strong political relationships so that war would become virtually impossible. Today, the EFTA is one of the most advanced economic free trade areas (FTAs) in the world.13 The EC is the most advanced economic integration arrangement in the world, recently achieving a single internal market amongst its members.14 By itself the EC constitutes the "world's

12The Euro-neutrals chose to refrain from the prospects of "pooling sovereignty" via supranationalism and assisted in the formation of the EFTA as an alternative to the EC. With the rapidly emerging confrontational environment, the Euro-neutrals were all the more ready to belong to a strictly economic arrangement. After all, an important element of neutrality is to be able to remain independent in action and avoid any perceivable infringements on sovereignty. I3In a free trade area, member states remove trade barriers (import tariffs and quotas) amongst themselves while retaining individual tariffs against non-members. ,4In July 1968, the EC completed its customs union. Not only did EC members remove all internal customs duties and quotas between them, but they also established a common external tariff against third countries. The EC's ”1992" goal was to take the customs union a step further along the path of economic integration by establishing a single internal market with the free movement of goods, capital, services and people. With the 1991 Maastricht Treaty, the EC aspires to form an economic union with a single currency and bank by 1999. The framework for this plan was presented in the Economic and Monetary Union (EMU) portion of the Maastricht Treaty.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 0 largest market;"15 combined, since 1984, the EFTA and the EC make up the world's largest industrial goods FTA. Yet their relationship illustrates much more than differences of approach to economic integration. Indeed, the EFTA-EC relationship clearly represents the distinctions between "... the logic of integration and that of state sovereignty."16 Although such distinctions exist within the EC itself, and have proven to be difficult hurdles to overcome up the path toward "an ever closer union," no better is this contrast in logic reflected beyond the EC than in its external relationship with the EFTA. This unique relationship embodies both the explicit and implicit divergences amongst western European nations in their varying levels of commitment to integration and increasing interdependence, and the concomitant distinctions between economic versus political and security cooperation in Europe. Thus, an assessment of EFTA-EC integration is reflective of the entire European integration process.17

I5The single market encompasses 350 million plus consumers. For more information, see Robert Williams, Mark Teagan and Jose Beneyto's The World's Largest Market: A Business Guide to Europe 1992. New York: American Management Association, 1990. 16Fran$oise de La Serre "Foreign Policy of the European Community." In Foreign Policy in World Politics; States and Regions. 7th ed. Roy Macridis, ed. 345-373. Englewood Cliffs, NJ: Prentice Hall Pubs., 1989, 350. 17 These two diverging approaches to European integration can be drawn from the two extremely different war-time experiences. Countries which did not experience war and occupation generally wanted to refrain from any elements of supranationalism while those nations which were either invaded or occupied, wanted to interlink so that Europe would not be swept away by a resurgence of nationalistic discontent and rivalry.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 1 Moreover, despite theoretical divergences on integration levels, the EFTA-EC relationship is unique because of its experience in cooperating for over thirty years. Given the rise of global regionalism and the increasing reliance on regional economic integration schemes, the successes and failures of the EC, in particular, and the EFTA-EC FTA, in general, are under rigorous scrutiny.18 In 1991, Thomas Pedersen, of the University of Aarhus, succinctly identified four phases in EFTA-EC relations.19 He referred to them as: (1) "abortive multilateralism" (1956-1958); (2) "separation" (1959-1972); (3) "pragmatic bilateralism" (1973-1983); and, (4) "combined bilateralism and multilateralism" (1984-present). The first stage began with parallel discussions within the Organization for European Economic Cooperation (OEEC) for a European-wide free trade zone, and amongst the founding six members of the

18Several regions throughout the world have simulated the European example of integration, either in the form of FTAs or common markets/customs unions. For example, the United States and Canada formed an FTA in 1987, which may soon include Mexico in a North American FTA. The Association of Southeast Asian Nations ("ASEAN": Brunei, Indonesia, Malaysia, the Philippines, Singapore, and Thailand) have formed a customs union, largely in response to Japan's economic strength in the region. Five Central American nations (Costa Rica, El Salvador, Guatemala, Honduras, and Nicaragua) formed a common market on April 1, 1993 (Business America. April 19, 1993, 10). The Commonwealth of Independent Sates (CIS) decided on May 14, 1993, to develop an "economic union," the highest level of economic integration, which includes all aspects of a customs union as well as a common currency and bank (The News Finance. May 15, 1993, 28). 19For a thorough overview the EFTA/EC relationship see Thomas Pedersen's "EC-EFTA Relations: An Historical Outline". In The Wider Western Europe: Reshaping the EC/EFTA Relationship, ed. Helen Wallace, 13-27. London: Pinter Publishers Ltd., 1991.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 2 EC for a more ambitious arrangement. This phase ended with the dissolution of the OEEC deliberations within the Haudling Committee and the creation of the EC. Because the two major groups within the OEEC continued to communicate, the second phase began as a "separation" rather than as a "divorce." It commenced with the establishment of the EFTA in Stockholm, and ended with the defections of the United Kingdom and Denmark to the EC, joined by neutral Ireland. The third phase began with the bilateral FTAs between the remaining EFTA members and the enlarged EC. Rather than a distinct cut-off point, the third phase evolved into the fourth, and most current phase, which reflects an intensification of the bilateral agreements as well as development toward a multilateral EFTA-EC dialogue.

The European Economic Area In an effort to move beyond the 1973 bilateral FTAs with the EC, the EFTA countries have been pursuing both bilateral and multilateral arrangements with the EC, which strive for closer economic ties, without involving the political implications of deeper EC integration. This most current stage in the EFTA-EC dialogue involves creating what has come to be known as a European Economic Area (EEA). Identified in the April 9, 1984, joint Luxembourg Declaration as a "dynamic European economic space," this

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 3 arrangement aspired to include, above and beyond the existing bilateral FTAs, multilateral cooperation between the EFTA and EC in industry, in approaches toward the third world, and in such "flanking" policies as education, research and development and consumer protection.20 Of the two organizations, the EC has been in the more dominant negotiating position since it is the EFTA which has been keeping pace with the EC's integration and not vice- versa. Moreover, it is the EFTA which is asking the EC to accommodate its economic interests via the multilateral EEA and the bilateral EC/EU membership negotiations. Nevertheless, because of its economic prowess, the EFTA was able to keep the EC at a comfortable distance for over twenty years, and in so doing was able to combine the best of both worlds - an FTA with the EC that promoted its economic growth yet also preserved its independence in security policy and sensitive economic sectors, such as fishing and agriculture. Therefore, as long as the EFTA could afford to remain outside of the EC's political implications, and not be detrimentally affected economically by remaining outside, it would continue to do so. While this EFTA strategy worked well into the 1980s, the EC's deeper integration goals increasingly meant that the EFTA

®Philippe G. Nell. "EFTA in the 1990s: The Search for a New Identity," Journal of Common Market Studies 38, no.4 (June 1990): 327- 358.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 4 would become de factorially regulated by the EC. Hence, the beginning of the EEA negotiations represented an acknowledgment by the EFTA that a new arrangement must be found in order to keep economic pace with the EC's continued integration. Yet, from the start of the EEA negotiations, the EFTA members hoped that the resulting EEA would allow them to keep pace with EC economic integration, without having to join as full EC members. However, because the EC was in the dominant negotiating position, it was unrealistic to think that it would negotiate in terms other than one sided and in favor of the EC. This, in fact, became increasingly apparent during the EEA negotiations and resulted in compelling EFTA defections, one by one, from the multilateral EEA settlement into bilateral full EC membership requests. Indeed, just one year after the 1984 joint Luxembourg Declaration and the start of the EEA negotiations, the EC announced goals for deepening its own integration with the establishment of a single internal market between its member states by 1993.21 This disclosure immediately interjected a new angle into the EEA negotiations. In fact, between 1985-1989 the EC's executive body, the Commission, headed by

21The 1985 EC Commission White Paper "Completing the Internal Market" was approved during the EC's June 1985 Milan Summit. The White Paper is often referred to as the Cockfield White Paper after the United Kingdom EC Commissioner who designed it. It explicitly set out a program and timetable for completing the internal market in 1992, to be effective in January 1993.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 5 Jacques Delors, made it progressively clear that the EC's own integration took priority over any external relations, including the on-going EFTA-EC EEA negotiations.22 This growing EC introversion necessarily affected the evolution of the EEA. Indeed, by January 1989 Delors requested that the EFTA "speak with one voice," and become a partner with the EC.23 At first, this was interpreted favorably largely because the EFTA understood it one way while the EC understood it in another way. While the EFTA thought that the EC was extending genuine joint decision making within the EEA, the EC looked upon the initiative as a way to reaffirm its own rules, under which the EFTA countries would be required to operate. It is often overlooked that the "Delors' Initiative" was not proposed on an entirely altruistic level. In fact, the initiative instructed the EFTA to become a "mini-EC" by forming a "pillar" in a "two-pillar concept," over which the EC would be easily dominant. To create such a "pillar" the EFTA would have to transform its Secretariat into some kind of

“This is especially reflected in the so-called Interlaken principles of 1987 which reaffirmed the three priorities of EC integration as being: 1) its own integration; 2) EC autonomy; and 3) balance of advantages and obligations. “The so-called "Delors' Initiative" identified two potential courses for the EFTA-EC relationship: 1) remaining essentially bilateral in nature; or 2) forging a "... more structured partnership with common decision-making and administrative institutions to make our activities more effective and to highlight the political dimension of our cooperation in the economic, social, financial and cultural spheres." Twentv-eiahth Annual Report of the European Free Trade Association 1989. 8.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 6 supranational Commission, certainly something with which it had no experience, by its own choosing. Moreover, the Delors Initiative was a matter of strategy: "Delors' speech was itself partly motivated by tactical considerations. To that extent it was an exercise in diversionary tactics."24 Indeed, the Delors Initiative had been designed with the expectation that the EEA would be sufficient reason for the EFTA countries not to be interested in joining the EC, since it would provide the EFTA countries with single internal market access. However, this increasing transparency of the EC-dominant nature within the emerging EEA regime made full EC membership the wiser alternative for the EFT* nations to seek in order to secure a viable input in both the policy formulation and the decision-making process. In conjunction with such EC membership aspirations, however, the EFTA members would continue to seek the more immediate short-term gains of the EEA. Indeed, since the EEA requires the EFTA members to adopt most of the EC laws (I'acquis communitaire), this makes the EC membership negotiations all the more manageable since so much work has already been accomplished.25

Thomas Pedersen, "EC—EFTA Relations: Neighbors in Search of a New Partnership". In Europe's Global Links: The European Community and Inter-Reaiona1 Cooperation. ed. Geoffrey Edwards and Elfridge Regelsberger, 97-111. New York: St. Martin's Press, 1990, 106. ^ o r example, in the case of Austria, 60 percent of EC membership will be covered by subscribing to the EEA, (FBIS-WFU-91-008. 11 January 1991, 1) and in Switzerland, 80 percent will be covered (Economist. July 13, 1991, 55).

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 7 Not uncharacteristically, Austria was the first to "take the plunge" and apply for full EC membership in July 1989, largely because of the limitations presented in the January "Delors' Initiative." While Austria viewed the emerging EEA as the "key" for EFTA's access to the single internal market in 1993, it did not view the EEA, as Delors' presented it, to be the end-all in its relations with the EC. In fact, it was becoming more clear that Austria would be better preserving its sovereignty as an EC member by having a more direct say in the decision-making process.26 Thus, the EEA, which was supposed to be sufficient in and of itself for both the EFTA members and the EC members, began to evolve as a "waiting room" for eventual EC membership, since the terms under which the nineteen countries would operate developed generously in favor of the EC twelve. Although the EFTA and the EC reached a final agreement on the EEA in October 1991 which included a joint EFTA-EC panel for dispute settlement under the EEA,27 the EC's European Court of Justice (ECJ) issued an opinion two months later that stated this joint panel violated the ECJ's judicial supremacy. The EFTA and the EC therefore had to revise the text of the EEA Treaty in reference to judicial procedures. This revised text was ready in February 1992, and approved

“"EEA - The Unique 1993 Key to the EC's Internal Market." EFTA Bulletin 31, no.4 (Oct.- Dec. 1990), 1. CTNew York Times. October 23, 1991, 1.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 8 by the ECJ in April 1992.28 The ECJ essentially ensured that the EEA court would be "functionally integrated" with the ECJ.29 During May 1992, the nineteen states met in Portugal to sign the Agreement, which was expected to come into force in conjunction with the EC's single internal market on January 1, 1993. Interestingly, in the final Agreement, EEA decision making is designed to operate on a consensus basis. Moreover, the EEA institutions give the EFTA members a surveillance authority (ESA) and a court which "... will have powers of enforcement similar to those enjoyed by the Commission and European Court of Justice within the EC."30 Nevertheless, the EFTA will be expected to adopt all EC rules relating to the EEA and will also be required to operate as a unit in accepting or rejecting EC rules.31 Thus, even with the revised EEA Court, the EFTA nations will still be giving up more sovereignty than current EC members by being asked to act as a unit rather than as separate

financial Times. April 13, 1992, 3. Schwok "The European Free Trade Association: Revival or Collapse?" In The External Relations of the European Community: The International Response to 1992. ed. John Redmond, 55-76. New York: St. Martin's Press, 1992, 66. ^"The European Economic Area," Background Brief. Foreign & Commonwealth Office, London, July 1992, 3-4. 31 Ibid.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 9 states.32 Yet, "if EFTA countries accept giving up part of their sovereignty in the EEA, why not do it directly in the EC?"33 Consequently, perhaps Austria's 1989 EC membership application was the "beginning of the end" of multilateralism within the EFTA group during the EEA negotiations. While "integrationist" Austria began to view the EEA as simply a "holding zone" until full EC membership could be achieved, other EFTA members, such as "isolationists'" Switzerland and Iceland, fervently hoped that the EEA would be sufficient so that membership in the EC could be avoided. Thus, those which preferred an arrangement that preserved remnants of the EFTA-EC relationship's status-quo immediately viewed Austria's move toward the EC as somewhat of a defection from their efforts at multilateralism. However, each EFTA member began to understand the motivations behind Austria's application and the EC's writing on the wall became more clear via its one sided demands, and by May 1992, all of the EFTA Euro-

^his also explains why the Euro-neutrals, the EFTA members most concerned with the sovereignty issue, were the first to apply for full EC membership. Consequently, the Euro-neutrals largely view their current EC membership negotiations as a matter of resolving the unfinished business of the EEA negotiations that went awry. Indeed, the requirement of EFTA operating as a unit likely played a significant role in Switzerland's rejection of the EEA Treaty during its December 1992 referendum. However, other reasons, such as the large Swiss financial contribution to the EC "cohesion” fund may have also factored in to the EEA rejection. Nevertheless, the EEA Treaty was adjusted for eighteen rather than nineteen members, and is expected to be operational by 1994. ^Schwok, 67, emphasis added.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 20 neutrals had applied for full EC membership. Ironically, rather than being an instrument to satisfy the EFTA members to remain outside of the EC, the EEA became the very instrument which only encouraged rapid applications to the EC. Reflecting on Pedersen's four phases in the EFTA-EC relationship, one cannot help but notice that the movement toward multilateralism between the two sets of nations (exemplified during the EEA negotiations), placed the two groups back, full circle, to the debate of the 1950s for a wider western Europe. While the EEA multilateral framework aspires to be more comprehensive and challenging than the wide European Free Trade Area envisaged during the late 1950s, this only serves to punctuate the cyclical pattern of the European integration movement as well as the EFTA-EC relationship. A further note of history's cyclicality is that during the early 1960s, three of the Euro-neutrals (Austria, Sweden and Switzerland) coordinated their quest for association status with the EC, at a time when association status was not clearly defined by the EC. However, as the EC began to define an association agreement,34 both Sweden and

Association status evolved specifically into an arrangement for European nations not able to economically integrate with the EC because of their developing status. This, in turn, required the associate members to accept EC rules and obligations, without any input in their development. This is discussed in greater detail in Chapter II.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 21 Switzerland withdrew their requests. Likewise, in today's situation, the resulting EEA Treaty impacts more on a neutral's sovereignty than full EC membership since full membership allows for genuine joint decision-making. What makes the two situations different, however, is the amount of integration and increasing interdependence which has occurred with the passage of thirty-plus years. While the Euro-neutrals could walk away from the political implications of EC association and membership status in the 1960s, because of their economic strength within the evolving EFTA, this is not the case in the 1990s. The solution of the 1990s, however, does not have to be at the price of abandoning neutrality since both integration and neutrality have evolved since the 1960s. After all, integration and neutrality are both processes that serve as a means to an end and not an end in itself.

Changed International Environment By late 1989, several unexpected changes occurred throughout Europe which only intensified the confusion over how to go about deepening and widening EC integration to include neutral members, without derailing the integration process. With the fall of the Berlin Wall, the collapse of Communist regimes in Central and Eastern Europe, the reunification of Germany, and the eventual demise of the

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 22 Soviet Union, the EC had more on its plate than it could manage in any near-term accommodation. Feeling the challenge (and burden) of leadership, the EC wanted to shine as a beacon of stability in an unstable Europe. Part of the "stability formula," argued the EC, was to strengthen itself before it could help others; thereby it justified its introversion and devoted several months to "summiting." The dual-track inter-governmental conferences (IGCs) culminated in the December 1991 Maastricht Treaty.35 Once the EC's "internal affairs" were resolved, it was ready to return to its external affairs. In January 1992, the EFTA and the EC had yet to resolve several of the touchy issues which had put the EEA on hold, namely the decision making process within the EEA, transport issues for the Alpine EFTA members (Switzerland and Austria) and fishing issues for the Nordic EFTA members (Norway, and Iceland). It took until April 1992 for the EEA Treaty text to be completed. Ironically, the EEA which the 1984 Luxembourg Declaration had envisioned would have probably been a sufficient arrangement had it not been for the EC's plans for a single internal market, the rapidly changing post-1989 European environment, and the goals set out in the

Maastricht was the town where the European Council met during the changing of the six-month EC Council of Minister's presidency from the Netherlands to Portugal. The next European Council meeting would be in Lisbon, in June 1992, then in Edinburgh in December 1992, and then in Copenhagen in June 1993.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 3 Maastricht Treaty. Because of these and other changes, it is now necessary for the EFTA members to keep pace with the EC in a much more direct way. It is therefore likely that the resulting EEA will primarily serve as the first step towards full EC membership for the majority of the EFTA members.

The Importance of Precedents During 1992, the stalled EOT ratification process compelled the EC to re-evaluate its approach and become more flexible on principles which some of the current EC members had difficulty in accepting. Indeed, this period of introspection directly affected the issue of EC enlargement. While the plan in June 1992 was for the EC to first resolve the EOT ratification process and the EC budget, by December 1992, this priority switched to beginning enlargement negotiations as quickly as possible.

The Danish and Irish Referenda When Denmark voted "no" in its referendum on the EOT,36 and Ireland voted "yes" two weeks later in its referendum,37 it soon became apparent that the debate on

*On June 2, 1992, Denmark held a referendum, and by a vote of 49.3% in favor and 50.7% opposed, rejected the EUT. ^On June 18, 1992, Ireland held its referendum. By a vote of 69% in favor and 31% opposed, Ireland accepted the EUT. The most explicit reason why Denmark was in a position to say "no" rather than Ireland was an economic reality - Denmark's economic strength versus Ireland's

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 4 deepening integration was still very much alive and well within the EC. With such visible oscillations of commitment between two members of the EC, the European Union dream received a harsh dose of reality, reaffirming the persistence of the national prerogative, albeit from a small member state. However, it should be recalled that Denmark also had a difficult time ratifying the SEA in 1987.38 Moreover, Denmark has a "past" - it was a member of the EFTA before it became a member of the EC, and it had a long tradition of neutrality prior to joining NATO in 1949. Not surprisingly, soon after the Danish rejection, pledges were made by the remaining eleven governments to forge ahead in the ratification process "with or without Denmark." Their hopes were that Denmark would be inclined to follow their lead and reconsider its rejection by ratifying the principles laid down in the EUT. However, the reality was that Denmark's vote against the EUT effectively made the EUT legally moot.39 Thus, Denmark was in a position to hold the deepening integration process ransom unless it resolved its problems with various commitments of

economic weakness. While the EC's common agricultural policy (CAP) plays an integral role in both countries, economically Ireland simply "needs" EC membership more. Indeed, Ireland has much to gain from the doubling of EC structural funds to the "poor four" of the EC: Ireland, Spain, Portugal and Greece (also referred to by some as "Club Med"). ^Indeed, Denmark added a declaration to the SEA which clarified that Denmark's participation in EPC would not infringe on its cooperation with the Nordic group. ^All twelve EC member states had to ratify the EUT in order for it to be implemented.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 5 the EUT. Like Denmark, Ireland also delayed in ratifying the SEA. Since Ireland has a constitutional requirement to remain a "sovereign, independent, democratic state," the SEA's "Title III," which addresses forging common positions in foreign and security policy issues, could potentially threaten its neutrality. Once an amendment was adopted, the SEA was finally ratified.40 Nevertheless, Ireland voted positively and without delay during the EUT referendum even though the EUT clearly contains additional implications for practicing a neutral foreign policy given the objectives of the CFSP. However, Ireland's major preoccupations revolved primarily around maintaining a steady economic market for its agricultural products, and increasing the EC structural funds, of which it is a major recipient.41 Apparently, neutrality was not an overriding concern for Ireland as it had been during the SEA ratification process. One cannot help but wonder if Ireland's change of focus was simply because it assumes that everything concerning neutrality was

^The Irish Supreme Court Case Crotty v. Taoiseach and Others determined that if the policy of neutrality was to be reconciled with the principles as set forth in the SEA, a Constitutional amendment would be required, despite the fact that Ireland's policy of neutrality is not rooted in Constitutional obligations. The amendment was primarily an effort to enhance the "credibility factor" of Ireland's neutrality policy. This is discussed in further detail in Chapter III. 4IFor example, every $1.00 Ireland contributes to the EC is returned by $6.00 in subsidies, grants and other payments from the EC. Washington Post. June 20, 1992, A19. However, this high economic reliance on the EC necessarily makes Ireland's ability to feasibly practice a policy of neutrality ail the more difficult.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 6 settled in the 1987 court case and that the goals of the EUT are no more ambitious than the SEA's had been. Yet, an additional prospect remains which might also play a role in Ireland's approach toward neutrality during the EUT referendum. Perhaps Ireland's concerns over maintaining its neutrality were assuaged by the fact that all four of the Euro-neutrals had already placed bids for EC membership. Indeed, given Ireland's more "flexible" brand of neutrality, it could feel the burden of responsibility shifted from itself to the newcomers in upholding this policy from within the EC. Interestingly, EUT disapproval came not from one of the EC member governments,42 but from the people of Denmark. In fact, the Danish rejection of the Treaty provoked France's President Frangois Mitterrand to schedule a referendum for September 20, even though, by law, France was not required to do so. The likely reasons for President Mitterrand's decision to hold a referendum include his confidence that France would not have any problems with the EUT, and probably because he felt the burden of responsibility firmly placed on France's shoulders to keep the dream of European Union alive. He therefore simply "rose to the occasion" of what he thought would be a certain

cIn 1965, France's General de Gaulle reaffirmed the national prerogative in the Council of Ministers during the "Empty Chair Crisis" which subsequently led to the Luxembourg Compromise. The impact of this is discussed in greater detail in Chapter III.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 7 outcome. However, his confidence proved to be slightly misplaced.43 Denmark's negative vote and France's slim positive vote exposed a larger problem throughout Europe. Many Europeans felt they were being overlooked and that EC decisions which are allegedly for the people's benefit were being made strictly by the out-of-touch "Euro-crats" in the corridors of the EC bureaucracy. Indeed, the proverbial "seed of doubt" was planted and throughout the remainder of the year, more EC members states fluctuated on their positions regarding the various principles of the EUT. Moreover, during the United Kingdom's November 1992 session in Parliament, it was determined that Britain would not vote on EUT ratification until after the second Danish referendum. This only added "opt-out" fuel to the "Europe a la carte fire", since many of the EC members (in particularly France), are hostile toward Britain's lack of adhering to the Social Charter, which in their opinion, amounts to British "job-poaching."44

Mitterrand's decision to hold a referendum was a politically risky move since his standing was at an all-time low and many considered the vote to be as much a vote of approval or rejection for Mitterrand as it was for or against the EOT. The results of the referendum were extremely close - 50.05% in favor and 49.95% opposed. ^William Orozdiak "French Say United Europe Promotes 'Job Poaching': Shift of Plant to Scotland Sets off Furor." Washington Post. February 10, 1993, A23.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 8 Edinburgh Summit During the December 1992 European Council summit at Edinburgh, when the EC Presidency was passed from the United Kingdom to Denmark, the Danes were able to secure "opt-outs" from the EUT in the areas of the CFSP, EMU and common European citizenship. No one would have projected that exactly one year after the Maastricht summit when Euro- optimism was at an all-time high, such flexibility would be allowed within the European Union. However, 1992 proved to be a year of derailments for the EU vision. It began with the Danish "no" vote to the EUT, and continued with the British and Italian withdrawal from the European exchange rate mechanism, the slim "yes" vote by France to the EUT, the Swiss "no" vote to the EEA, and ended with the several opt-outs for the Danes from the EUT. With such a vivid year of resurging nationalism throughout Europe, the EC was willing to accommodate the impertinent Danes if it would secure the likelihood of Danish EUT ratification. A second Danish referendum was held in May 1993. Although it would have been logical to assume that the referendum would be favorable since Denmark's Social Democrats were in power (the same party which insisted on the opt-outs for Denmark in the first place), this was not necessarily a foregone conclusion since in recession-ridden Europe, political party leadership and governments were and

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 9 are not viewed favorably by the people. Indeed, why should the people support a government they do not trust, let alone the far-away bureaucracy in Brussels? Not surprisingly, therefore, the second Danish referendum proved to be another cliff-hanger.45 During the June 1992 Lisbon summit, the EC stated that budgetary issues and the EUT's ratification were to be resolved before membership negotiations could occur. However, six months later at Edinburgh, it was decided to start negotiations with several EFTA applicant states in February 1993, under the Presidency of none other than the Danes. This was, indeed, ironic; the very nation which had essentially "derailed” the EUT would now be in the driver's seat. Moreover, at Edinburgh, clarification of the subsidiarity principle46 was essential given the "year of fear" of EC over-centralization. It was also resolved that the CFSP element of the EUT would not be up for review until the 1996 IGC. This is particularly important since by that time, the Euro-neutrals hope to be full EC members and will

^The second referendum was held on May 18, 1993, and resulted in a positive vote of only 56.8%. *The principle of subsidiarity asserts that issues which can be resolved at the member-state level will be left to the member-state. As such, the EC bureaucracy is not allowed to get into the "nooks and crannies" of internal affairs. See: "The Principle of Subsidiarity," Bulletin of the European Communities: Commission, 25, no.10 (Dec. 1992), 116-126. However, while most subscribe to it as a principle, little is yet ensured/assured since working it out in practice will be a continuing EC issue for many years. As in arms control, "the devil is in the details."

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 3 0 be able to directly shape what these policies will be. In effect, therefore, the Euro-neutrals will not necessarily have to conform their neutrality to fit the EU's vision of the CFSP, rather they will participate in developing EU policies to fit their national interests. Thus, the importance of precedents cannot be minimized. The United Kingdom set a precedent during the Maastricht negotiations when it secured an opt-out of the Social Charter. In turn, the Danes secured several opt-outs during the Edinburgh Summit one year later. Reflecting on the positive outcome of the second Danish referendum, Swedish Prime Minister Carl Bildt forebodingly commented: "The Danes got a Danish solution.... When the time comes, we will hold out for a Swedish solution."47 Finally, on October 12, 1993, Germany's highest court ruled that the EUT did not infringe on Germany's sovereignty, and cleared the way for implementing the Maastricht Treaty. Nevertheless, the court's decision was an extensive judgement explaining why it did not view the EUT as a threat "... thanks to national democratic controls implicit in the Maastricht Treaty."48 Moreover, it was stressed that "Germany is not subordinating itself to an unclear, automatic and

^Marc Fisher, "Now Europe Faces Toughest Test: Unifying Amid Hard Times." The Washington Post. May 20, 1993, A26. ^Quentin Peel and Lionel Barber, "German Court Gives Approval to Maastricht." Financial Times. October 13, 1993, 1.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 3 1 uncontrollable mechanism."49 Not surprisingly, some of the more federally-minded EC states viewed Germany's 95-page judgement as a list of caveats to the EUT.50

Redefining Neutrality It must be understood that neutrality is predominately considered as a means and not an end in itself for the countries that have practiced it over the past several decades. The "end" for the Euro-neutrals has been primarily the preservation of security, sovereignty, and national identity. Likewise, integration serves as a means of establishing cooperative mechanisms and procedures to keep pace with the growing interdependency of the world, whether on an economic, political or security level. Both neutrality and integration are tools which ultimately reaffirm the survivability of each nation state which chooses to engage in either process. Since integration dynamically affects both internal (domestic) and external (foreign) affairs, it is intertwined with practicing a neutrality policy. Therefore, neutrality and integration are not as incompatible as they initially seem since both are dynamic processes.

^Quentin Peel, "German Court's Maastricht Ruling a Win For All." Financial Times. October 13, 1993, 2. “"The Hague Questions German Court Ruling on Maastricht," FBIS-WEU- 93-204. 25 October 1993, 16.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 3 2 Given the end of the Cold War, the notion of maintaining neutrality in the post-Cold War era seems to be anachronistic. Indeed, such prominent European security officials as the Western European Union's (WEU) General Secretary Willem van Eekelen have stated: "Neutrality against whom? For me neutrality is something outdated."51 However, such a statement relegates neutrality to the Cold War era, and does not take into consideration that neutrality existed prior to the Cold War, nor does it accept the possibility that there would be a reason to retain it during the post-Cold War era. This, however, is to understand history in a vacuum. In addition, it would seem that the end of the Cold War has promoted a trend toward more interdependence. Nevertheless, a closer look reveals that alongside the growth of interdependence, and in fact, because of it, is the reassertion of independence. Consequently, neutrality is still very much a salient policy for the small nations that use it as a tool for reasserting their independence of action and national identity in a world of ever-increasing interdependence. Despite the collapse of the bi-polar system, each of the Euro-neutrals, to varying degrees, still considers it valuable to maintain neutrality. While it was indisputably

51 "WEU's Van Eekelen: Balkan Policy 'Not Consistent', FBIS-WEU-93- 205. 26 October 1993, 14.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 3 3 easier to practice neutrality in the more clearly delineated black and white framework of a bi-polar world, it is both short-sighted and parochial to assume neutrality has entirely lost its meaning. While it is generally true that both Austrian and Finnish neutrality were developed as a direct result of the emerging Cold War atmosphere of the late 1940s and early 1950s, both the Swedish and Swiss brands of neutrality have been practiced for centuries. To date, all four Euro-neutrals have admitted that a certain degree of redefinition of neutrality and its applicability in Europe today must occur, but redefinition is hardly obliteration.

Retaining Neutrality inside the EC Of the four Euro-neutrals, only Austria included a request in its EC membership application regarding the retention of neutrality. However, Austria placed its bid under considerably different circumstances than the other three. When Austria formally applied in July 1989, the Soviet Union, although in the throes of reform, was still very much in existence. Given the Soviet Union's influence on and traditional concern for the continued existence of Austrian neutrality, it is understandable that Austria would insist that its brand of neutrality be retained with its acceptance as an EC member. Moreover, given Austria's

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 3 4 history of Grossraumdenken ("thinking big"), based on its desire for unification with the Weimar Republic during the inter-war years,52 it is also understandable that Austria would stipulate the necessity to retain neutrality in an effort to assuage Soviet fears of an informal Austrian Anschluss with Germany inside the EC. Despite EC aspirations for a European Union, Austria has staunchly viewed its brand of neutrality as being compatible with EC goals. This was true even prior to the Soviet Union's demise and is due to the political culture of Austria's foreign policy, as well as public opinion which has consistently stressed a "larger" European option. Of the Euro-neutrals, Austria has been the most persistent in seeking a closer relationship with the EC, whether through an association agreement (as was the case during the 1960s), or, more recently, through full membership. However, even though Austria has viewed its neutrality with flexibility both during and after the Cold War, credibility was an especially important issue during the Cold War years, since the Soviet Union had played such a large role in Austria's decision for neutrality.53 Although both Sweden and Switzerland had joined

^eter J. Katzenstein, "Trends and Oscillations in Austrian Integration Policy Since 1955: Alternative Explanations." Journal of Common Market Studies 14 (1975-1976), 171-197; especially 180. ^avid Kennedy and Leopold Specht's "Austrian Membership in the European Communities." Harvard International Law Journal 31, no.2 (Spring 1990), 407-461; especially 409.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 3 5 Austria in a "common front strategy" during the 1961-1963 timeframe to acquire associate membership status, only Austria continued the negotiation process for another eleven years to seek an arrangement for itself.54 Ironically, however, just as Austria was the most persistent during the 1960s via its Alleingang ("solo-action strategy"), as well as the first to abandon the second "common front strategy" in the multilateral EEA negotiations by applying for full EC membership status in 1989, such persistence does not necessarily pay off since the "bottom-line" remains that the EC prefers to work in "package deal" arrangements. Since the other Euro-neutrals have now applied, it makes it all the more convenient for the EC to lump all of them together. However, there is a certain amount of danger in trying to collectivize the experiences of the Euro-neutrals, since each is neutral for its own unique historical and geo political reasons. As A. Mozer, former Chief Executive of

In 1962, Austria, Sweden and Switzerland coordinated their bids for EC association status primarily because of their neutrality policies. However, when de Gaulle vetoed Britain's membership application, both Sweden and Switzerland withdrew their requests for association. Austria, on the other hand, did not. By 1967 when Britain had placed its second application, Sweden also reapplied. See: Richard Dunn's "Austria's 11-year Courtship of the Community," European Community (London edition), September 1962, 14-15. This is discussed in further detail in Chapter II.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 3 6 the EC Commission, stated in 1972: ... the point is reached where one has to abandon the summary notion of neutrals and turn to a differentiated view of the position of these countries whose neutrality varies considerably. The collective term no longer suffices for the individual countries.55 Despite this insight into the inherent dangers of collectivizing disparate nations (and from an EC Commissioner, no less), it is likely that the EC will still pursue a holistic approach, especially when it comes to the broader policy issues such as the CFSP. Thus, although Austria provided the "jumpstart" and persistence during both the 1960s and late 1980s, the resulting arrangements for all EFTA members are likely to be virtually identical inthe outcome of the current EU membership negotiations, as they had been in 1973 with the bilateral FTAs.

Benefits of Coordination in the Past and in the Future A certain amount of coordination would, in all likelihood, be the most beneficial bargaining position for the Euro-neutrals during their parallel bilateral negotiations with the EC. While such coordination can, at first glance, seem to defy the very purpose of practicing

A. Mozer. "The European Community and the Neutrals.” In The European Community in the World, ed. P. Everts, 81-94. Rotterdam University Press, 1972, 86.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 3 7 neutrality, such coordination realistically takes into consideration the "changed circumstances" which have shaken the European continent and also supports the argument that neutrality serves more as a means than an end in itself. Such coordination is not anathema since the Euro- neutrals worked together in the past not only during the "common front strategy" of the 1960s and somewhat in the 1980s, but also within the parameters of the Conference on Security and Cooperation in Europe (CSCE) in the so-called NNA group.56 The Euro-neutrals have also all had the status of "guests" at the non-aligned movement (NAM) summits since the 1970s, and all four, except Finland, took a common position on the International Energy Program and the International Energy Agency (IEA). They joined once a special clause had been added in their agreements regarding a guarantee of their neutral status, despite provisions these still contained for weighted majority voting and the

^ h e CSCE is a pan-European security platform which operates on the rule of consensus. Also known as the "Helsinki process,” the CSCE began in 1975 with the Final Act. During the Cold War, three groups emerged in the CSCE: the members of the Warsaw Pact, led by the Soviet Union, the members of NATO, led by the United States, and the group of neutral and non-aligned nations, which came to be referred to as either the NNAs or the N+N group. During the Cold War, substantial collaboration occurred within the NNA group on security issues since this was the only security platform to which any of them belonged. Largely because of their mediatory abilities.the NNAs ensured progress within the CSCE on confidence building measures and confidence and security-building measures. The NNAs also kept the CSCE process going during the "times of troubles" between the blocs, when it seemed likely no discussions could occur.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 3 8 possibility of automatic oil-sharing.57 Easily overlooked, but equally important, is the coordination which occurred during the inter-war years in the collective security platform of the League of Nations, and within its follow-on organization, the United Nations. Thus, the cooperative progress made from these experiences can be directed toward the best possible package deal from the EC during membership negotiations.58 Moreover, as EC practice indicates, it prefers to deal with enlargements in lump sums.59 It is therefore likely that the EC's fourth enlargement (or, the EU's first enlargement), will include all "willing" EFTA countries

“George Maude, The Finnish Dilemma; Neutrality in the Shadow of Power. London: Oxford University Press, 1976, 128. “Austria made statements that it intends to coordinate with the other neutrals during the negotiation process ("Vranitzky on EC Reservations, European Army," FBIS-WEU-91-150. 5 August 1991, 2-3). In addition, Sweden and Finland have admitted that cooperation may get quicker results ("Finnish, Swedish Aides Seek Rapid Completion of EC Talks," FBIS-WEU-93-173. 9 September 1993, 5). Austria's fluctuations between bilateral and multilateral cooperation are highly illustrative of a neutral's application of the "means and end" aspect of neutrality; it operates as an opportunist. For example, as soon as the multilateral EEA negotiations began to look as if they were not going to produce everything that Austria wanted, Austria pursued a special bilateral arrangement since this would best serve its national interests. The others followed within three years. Also, during the timeframe immediately preceding the second Danish referendum, when it looked as if the Danes might again say "no", Austria verbally disassociated itself from the Nordic neutrals. When placed in the precarious position of a "prisoner's dilemma,” Austria, (as well as the other neutrals), does not have a problem choosing what is best for it. However, this is not unique to the Euro-neutrals; it is how all nation-states operate, to varying degrees. The Euro-neutrals have simply had to be more careful in their considerations because of the potential spill-over of their actions on the credibility factor of neutrality. “The first enlargement occurred in 1973 with the United Kingdom, Ireland and Denmark. The second enlargement occurred in 1981 with Greece. The third enlargement occurred in 1986 with Spain and Portugal.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 3 9 while the EFTA members which prefer to remain outside, but would like to have access to the single market, will use the EEA as the middle ground.60 Thus, although the EEA may be hailed as merely a "provisional agreement" until all EFTA members join the EC, history teaches that provisional agreements have a tendency to acquire quasi-permanency. Therefore, the EEA will likely serve either as a portal into the EU's single internal market, or as an alternative to it, without the prospects for isolation or marginalization. Ironically, the preferred "package deal" negotiating style of the EC could work more in the favor of the EFTA group. If the Euro-neutrals could develop a "common front strategy" amongst themselves, built on many years of prior cooperative efforts, they could strengthen the EFTA's negotiating position vis-i-vis the EC since the EC's efforts to "simplify" arrangements could potentially undermine its strategy. After all, while the accession agreements will be bilateral on the surface, they will likely be, de factorially, multilateral agreements, as were the FTAs. As negotiations between the three Euro-neutrals and the EC proceed, the three can potentially form a "neutral coalition" and they could ensure, if only in a "lowest

“As of December 1993, only Iceland and Liechtenstein have not applied for EC membership within the EFTA group. Since Switzerland voted against the EEA, it will continue to maximize its 1973 bilateral FTA with the EC. However, just because Switzerland said no to the EEA does not mean that it has said no to the EC.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 4 0 common denominator" arrangement, that neutrality is understood by the EC as being a relevant issue for these countries, despite the end of the Cold War. Although formal coordination did not occur between the Euro-neutrals in submitting their respective EC applications, coordination has occurred during the negotiations between the EC and the neutrals, as was the case during the early 1960s. While Denmark's initial "no" to the EUT clearly displays the persistence of the national prerogative, the fact remains that maintaining strength and security in an interdependent world requires a certain degree of participation and coordination. Indeed, more and more the lines between politics and economics are becoming blurred in the international political economy. More and more the definition of security is evolving to include both economic and political considerations. For the very countries at hand, whose strong economies have thus far allowed them to practice a credible policy of neutrality by remaining outside of the EC, economic policy is becoming more and more the overriding concern of both their domestic and foreign policy agendas. Accordingly, the redefinition of neutrality will undoubtedly take into consideration the globalization of the world economy. Economics is, after all, traditionally the first level of integration (as emulated in the EFTA), while the

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 4 1 potential follow-on of deeper issue areas such as politics and defense are aspired to by some of the EC members. Thus, it is interesting to note that there is a direct relationship between a neutral country's ability to economically support itself and a neutral's contemplation of EC membership. As seen from the Euro-neutrals' paths toward EC membership, the neutral that is the best off economically was the last to place its bid for EC membership (Switzerland) and the only one to reject the EEA, while the neutral that was the worst off economically was the first to join the EC (Ireland) .6l However, strong public support for retaining a neutral policy preferably in conjunction with full EC membership is evident throughout each neutral nation, so this is likely to be reflected during the membership negotiations, as well as in the eventual referenda for the people to either approve or reject what the Euro-crats and the EFTA governments devise as a compromise. Therefore, coordination between the EFTA national governments and their citizens is also vital since

“indeed, economic integration is the primary motivator for the Euro-neutrals' guest for EC membership today. In fact, European neutrality and European political integration were reconcilable even during the Cold War. By primarily economic choice, the Euro-neutrals chose to remain outside of the EC (because of their favorable economic positions), even if the more apparent reason would seem to be neutrality. This reaffirms why Ireland joined the EC when it did since it was not in an economically favorable position not to join. Even so, Ireland retained its neutrality with EC membership.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 4 2 all potential new EFTA members will be holding referenda.62 Lastly, but probably most importantly, the EFTA countries are in a very favorable bargaining position vis-k- vis the EC since they are the only countries in Europe that can contribute financially to the EC budget. Therefore, this research ultimately challenges the widely-held assumption that the EFTA "needs" the EC more than vice versa. The EFTA countries have always been unique and cannot be so easily pooled with the rest of Europe that is knocking on the door for EC membership. Consequently, the EC is likely to grant concessions to the economically stable EFTA countries which it would not provide toward other potential members.

The Impact of the CFSP on Neutrality The CFSP is designed as a separate pillar within the EU and will operate along inter-governmental lines. Accordingly, the CFSP will not impair a neutral nation's ability (or any other nation's ability) to "opt-out" if the common action infringes on its "vital national interests" (i.e., maintaining neutrality), or if it goes against United Nations principles. Indeed, above and beyond Ireland, some

GIn order to become members of the EU, Austria, Sweden, Norway and Switzerland must all hold referenda which will be the determining factor. Only Finland's referendum will be held in advisement by the Parliament. In other words, if the Finnish referendum was negative, Finland could still possibly become a EU member.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 4 3 of the current EC members which have had experience with a neutral foreign policy in the past possess remnants of that policy today, even though it is no longer the formal practice espoused by the government. Included in this group are Denmark, Luxembourg and Belgium, with Denmark reaffirming its familiarity with "going against the grain" most recently during the June 1992 referendum. As such, Denmark demonstrates that even if a country gives up its neutrality, it is something that leaves a strong impression on the functioning of a foreign and domestic policy.63 In addition, the goals as put forth in the European Political Union of the EUT have yet to be developed, but they implicitly encourage further "Europeanization" in politics and security via the Western European Union (WEU) as the defense component of the European Union. However, the WEU will continue to act as the European pillar of the Atlantic Alliance, so the overarching NATO framework and the U.S. involvement in Europe is not yet a relic of the past, nor will it likely be for the foreseeable future. Even as the U.S. becomes increasingly introspective while slashing troop levels in Europe, concomitant with the specter of Great Russian nationalism looming large on the neutrals' eastern horizons, many European nations are considering

^Denmark's retention of a neutral tendency (despite the shedding of its label) is explored at length in Carsten Holbraad's Danish Neutrality: A Study in the Foreign Policy of a Small State. Oxford: Clarendon Press, 1991.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 4 4 their long-term futures with a not inconsequential Russian military. Indeed, despite the end of the Cold War and the Soviet Union, rather than the abandonment of a policy which has been practiced for decades by Austria and Finland and for centuries by Sweden and Switzerland, it is more conceivable that the Euro-neutrals will simply adapt their policies to the changed circumstances. Thus, the abandonment of neutrality is remote.

Pan-European Integration and Strength in Diversity The debate on European integration is alive and well today both inside and outside of Europe. Just as it was a salient issue during the post-WW II era, so too is it now in the post-Cold War era. However, the importance of this debate has never let up, and has continued to exist, to varying degrees, whether it has been the "federalists" versus "functionalists", the "logic of integration" versus the "logic of state sovereignty", or the "deepeners" versus the "wideners." The debate has simply become more visible and intensified since the topic of enlargement is once again on the EC's agenda. Indeed, over the next several years it will be particularly interesting to observe just how the EC/EU is going to reconcile its stated objectives of both "deepening" its integration goals by extending its reach into political and possibly defense areas while

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 4 5 simultaneously "widening" its current membership to potentially twice its size.64 One of the most discernible issues in the debate is therefore how the EC is going to balance and accommodate both visions, and what effect this reconciliation may have on the current EC members as well as the potential EC/EU members. Any decisions made on how this debate is to be reconciled will directly affect how the integration process is likely to proceed in Europe.65 Throughout its history, the EC's persistent concern has been not to sacrifice its deepening accomplishments and goals of integration by enlargement, and its practice has been to simultaneously do both. This pattern will likely

‘‘See: "Twelve or twenty-four?" The Economist. July 7, 1990, 12-19. Of particular importance, although easily overlooked, is the addition of a "thirteenth" member to the EC with Germany's reunification. Observing this relatively discrete, yet quick enlargement encouraged other European "outsiders" to contemplate EC membership all the more, especially with the potential risk of economic "satellization" for those remaining outside the market. The former German Democratic Republic (GDR) has been a "silent" member of the EC from as early as the beginning of Ostpolitik. However, with Germany's formal reunification, the absorption of the GDR took a record four months to complete. However, the effects of absorbing the GDR's economy will undoubtedly be felt for years to come, by both the Federal Republic of Germany (FRG) and the EC. 6SWhile the term "Europeanization" is usually used in reference to Europe's vacillating relationship with the U.S. in the Atlantic Alliance, by its becoming more dependent on its own faculties for its economic and political well-being, this research is primarily concerned with the states both inside and outside of the EC in Europe, and therefore addresses the more specific question of how much "EC-ization" has occurred, is occurring, and is likely to occur in Europe. While its focus is European, however, its significance is universal. Indeed, the European integration process both within and between the EFTA and the EC has led towards a trend of further "Europeanization" primarily in the economic field and more peripherally in politics and security.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 4 6 not change. But, as Jeffrey Harrop noted in 1989: ... how much flexibility is possible and can it be provided without creating so many exceptions and special cases that ultimately it distorts and discredits the whole organization. In the new Community the less standard and more diverse pattern of integration which has had to emerge is likely to be reinforced in the future. A much looser pattern of integration seems inevitable... A more variegated pattern of integration enables the more dynamic countries to press on ahead, acting as catalysts to new policy areas and providing a way of breaking the soul-destroying deadlock and paralysis of the EC.66 Therefore, the EC/EU must exemplify its strength in diversity, not uniformity, and the Euro-neutrals have much to provide the EU in their combined experience in bloc-free collective security pursuits. Moreover, the growth of "institutional eclecticism" and "organizational overlap"67 throughout Europe demands that accommodating diversity is the only realistic way a European Union can be accomplished. Although there is an admitted cost in accommodating both visions of a wider and deeper EC/EU, the probable gains are worth that cost, while the status quo is truly no longer an option. Thus, today's changed circumstances demand reconcilable rather than irreconcilable differences between European neutrality and integration, as well as deepening

“Jeffrey Harrop, The Political Economy of Integration in the European Community. Brookfield, VT: Gower Publishing Co., 1989, 188-190, emphasis added. CT"Institutional eclecticism" and "organizational overlap" are terms coined by Dr. William C. Cromwell, Professor at the School of International Service of The American University, Washington, D.C. to describe the proliferation of new organizations from many sources covering a broad range of issues - some of whose roles and responsibilities overlap.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 4 7 and widening integration within the EC. Nevertheless, the changed circumstances alone have not made this possible. The EC/EU's inherent flexibility with its strong inter governmental nature (despite the rhetoric to the contrary), and because of the diverse members currently within its framework, encourages diversity and leaves many more options open than before. However, it is essential to recognize that while further integration has been designed in western Europe, further disintegration is occurring in eastern and central Europe, as well as in the former Soviet Union. The sweeping changes of recent years have necessarily altered what the EFTA and the EC planned as a priority in 1984 in the Luxembourg Declaration and also what the EC planned in its SEA for 1992. Indeed, such changes have provided an external catalyst for further European integration and cooperation, and provide a new responsibility for all of western Europe to assist in rehabilitating the East. Therefore, the more quickly the EFTA and the EC resolve their integration plans, the better off the East will be, and the sooner each and every country can make its respective "return to Europe." Helen Wallace, of London's Royal Institute of International Affairs, and Wolfgang Wessels, of the Institut fiir Europaische Politik, noted the

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 4 8 dangers of the West's preoccupations: [i]f the mundane and technical issues of the economy cannot be solved with partners that are so like the EC, then some skepticism is in order about the ease with which such questions could be addressed with partners only recently released from the shackles of inefficient central planning and forbidden market economies.68 By widening EC membership, the EC will inevitably have to encourage further "variable speeds" and tiers of integration in such areas as monetary union, social policy and defense, which will result in a Europe of even greater flexibility and pluralism. Therefore, the EC (and the EFTA) must responsibly rise to this challenge by being flexible in balancing the goals of deepening integration and widening membership. It seems that the scene has been set by the course of recent history to reconcile several paradoxical issues and to achieve a genuine European Union which spans "from the Atlantic to the Urals." It is now primarily up to EC leadership to see it for the unique opportunity that it is and to act upon it with both long-term and short-term interests in mind. Hope, however, is gleaned from the fact that even when prior EC leadership was at a "deficit level," progress along the integration track continued, even if during the process they

“Helen Wallace and Wolfgang Weasels, "Conclusions." In The Wider Western Europe: Reshaping the EC/EFTA Relationship . ed. H. Wallace, 268-281. London: Pinter Pubs., 1991, 281.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 4 9 were "walking backwards towards unity".®9

“Title taken from William Wallace's chapter "Walking Backwards Towards Unity" in Policy-Making in the European Communities, ed. Helen Wallace, William Wallace and Carole Webb, 301-324. New York: John Wiley & Sons, 1977.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. CHAPTER n

HISTORICAL BACKGROUND OF EUROPEAN NEUTRALITY AND INTEGRATION

History is a tale of efforts that failed, of aspirations that weren't realized, of wishes that were fulfilled and then turned out to be different from what one expected. Henry Kissinger, 1974

The Resilience of Neutrality in Europe

Neutrality as a practice of one nation's impartiality toward two or more warring states was mentioned as early as the Peloponnesian War in the writings of Thucydides.1 In addition, neutrality operated extensively during the classical European balance-of-power system prior to World War I, during the inter-war period in conjunction with the collective security efforts of the League of Nations, and

‘The Peloponnesian War between the rival Greek city-states of Athens and Sparta took place from 431-404 B.C., and ended with the victory of Sparta. Thucydides, an Athenian general who took part in the war, wrote the History of the Peloponnesian War, often credited as one of the foundations of Western civilization. Of particular importance to the concept of neutrality is the so-called Melian Dialogue (Book V, Chapters 84-116) which describes the Athenian attack on the small island of Melos in 416 B.C. Melos attempted to practice a policy of neutrality by helping neither side. However, since the Melians had been colonists from Sparta, the Athenians insisted the island become part of the Athenian city-state. The Melians refused and were consequently massacred. Thucydides therefore revealed in this dialogue the first signs of "realpolitik," a policy based on practicality and power rather than on any doctrine or ethical objectives. For more information see: Jacqueline De Romilly's Thucydides and Athenian Imperialism (New York, 1963); and Peter J. Fleiss' Thucydides and the Politics of Bipolarity (Baton Rouge, 1966). 50

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 5 1 during the bi-polar environment of the post-World War II era alongside the collective security effort of the United Nations (UN) and the regional pan-European security efforts of the Conference on Security and Cooperation in Europe (CSCE). Indeed: [n]eutrality has undergone a complex and adaptive evolution through the history of international politics. Over the past two centuries many neutral states have disappeared. Other states have assumed a policy of neutrality, and some formerly neutral states have committed themselves to military alliances. The identity of particular neutral states has changed from time to time, yet the concept of neutrality has endured and adapted to profound alterations in the nature of international politics.2 Neutrality has therefore been in existence and has adapted as a foreign policy instrument for a considerably long period of time. Why should it now become obsolete, simply because the latest war - the Cold War - is over? As long as the will and potential for war exists concomitantly with the existence of small states that wish to preserve their sovereignty and national identity, so too will be the utility and practice of neutrality, in one shape or another. Indeed, the continued co-existence of neutrality and collective security platforms during the 20th century is a clear indication that collective security organizations have not yet subsumed the practice of neutrality. While many

2Joseph Kruzel. “The Future of European Neutrality." In Between the Blocs; Problems and Prospects for Europe's Neutral and Nonalianed States. ed. Joseph Kruzel and Michael H. Haltzel, 295-311. Washington, D.C.: Woodrow Wilson International Center for Scholars, 1989, 295.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 5 2 have argued that the two concepts of neutrality and collective security are mutually exclusive, and that in a world of collective security neutrality has no place, history indicates that the two are in fact able to co- habitate.3 As the international jurist, Hersch Lauterpacht stated in 1936, which is just as relevant in today's international (and regional) environment: "'neutrality and collective security are complementary concepts; the more there is of one, the less there is of the other.'"4 Thus, until the world gets to a point where there is complete collective security (which is unlikely to occur in the distant future), neutrality will continue to remain a viable tool. While collective security may focus on "peace-keeping" efforts, at which the Euro-neutrals are particularly adept as seen by their participation in UN peace-keeping efforts, "collective defense" is another side of collective security, and has been primarily manifested in such arrangements as NATO and the former Warsaw Pact. While collective defense

^This explains why many were appalled at the idea of states retaining neutrality in Europe when the United Nations existed, as well as NATO and the Warsaw Pact. For example, U.S. Secretary of State John Foster Dulles, referred to the practice of neutrality as "immoral". In the clear black and white world of the immediate post-WWII timeframe, the sentiment was "you are either with us or you are against us”. As such, neutrality, a rather grey area between the two extremes, was viewed as suspect, with its very existence undermining the goal of collective security.

^Quoted in Efraim Karsh's Neutrality and Small States. New York: Routledge Publishers, 1988, 130.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 5 3 was moderately utilized under the UN guise during the Korean War and during the 1990-91 actions against Iraq, the UN's primary focus has been on the peace-keeping aspects of collective security, with which neutrality is compatible. Thus, unless collective security is subsumed by collective defense, the co-existence of neutrality with collective security remains firm. During the "here and now," before the materialization of the common defense rhetoric contained in the EUT's CFSP goals, neutrality will remain compatible with the regional cooperative security elements contained in the CFSP. Thus, today's integration efforts by the Euro- neutrals largely amount to a strategy of getting inside of the EUT in order to participate in the development of regional security which will directly affect them. During the process of "redefining" European neutrality, its legacy will undoubtedly live on in the countries that have so successfully practiced it, in some cases, for centuries (such as Sweden and Switzerland), as it has lived on in disrepute in some of the nations that were not successful in their declarations of a neutral posture (such as Belgium and Luxembourg). For those nations which have been successful, however, neutrality has become so deeply rooted in their political cultures that the policy has become associated with the reasons why it has kept the country out of war, and why it has allowed an amount of

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 5 4 independence it would not otherwise possess. As such, neutrality has provided a "security blanket" for both the governments and populations at large. Given the instability of the rapidly changing Europe, both neutral and aligned states will surely recall the unique simplicity of the bi polar Cold War days when the lines and compartments of Europe were clearly delineated and the neutrals primarily played the role of "buffer states" between the blocs.

Machiavellian Pragmatism Neutrality is a tool for small states. It operates primarily as a means to an end since its purpose is to preserve a small state's independence, freedom of action and national identity. The classic work by Niccolo Machiavelli, The Prince, discusses the necessity of pragmatism in maintaining a state as well as the importance of proportionality and adaptability in state-to-state

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 5 5 relations. Machiavelli stated: ... [a prince] should be so prudent that he knows how to escape the evil reputation attached to those vices which could lose him his state .... And then, he must not flinch from being blamed for vices which are necessary for safeguarding the state. This is because, taking everything into account, he will find that some things that appear to be virtues will, if he practices them, win him, and some of the things that appear to be wicked will bring him security and prosperity.5 Indeed, the practice of neutrality, especially during the 20th century, has largely been viewed as suspect and has even been referred to as "... 'indifferent', 'self- centered', 'opportunist', 'short-sighted' [and immoral]"6 in its preference of non-commitment.7 Yet, using Machiavelli's logic, in the case of certain small states, neutrality can be viewed as a "necessary vice" in order to safeguard the state. While few nations and politicians understand it, this must not make the state forego what is best for its self-preservation. Moreover, Machiavelli's invocation of an Aesop's

Piccolo Machiavelli, The Prince, trans. by George Ball. Baltimore: Penguin Books, 1970, 92.

‘Bill MeSweeney, "Introduction: Some Arguments Against Irish Neutrality." In Ireland and the Threat of Nuclear War, ed. B. McSweeney, 3-20. Dublin, Dominican Publications, 1985, 7.

7Some nations even considered the Euro-neutrals to be "free- loading" off the defense umbrella provided by NATO; in this way the Euro-neutrals could reap the benefits of such security, but not have to pay for any of it. This assumption does not take into account the fact that the Euro-neutrals, in particularly Sweden and Switzerland, have spent more on their defense than many of the European NATO members. Thus, maintaining a credible policy of neutrality is very expensive indeed since it is entirely self-reliant.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 5 6 fable reflects requirements for flexibility depending on the situation at hand, ranging from the simplicity of a lion (thinking in terms of the "big move"), to the complexity of a fox (thinking in terms of an intricate series of moves). Finally, Machiavelli critiques alliances and advocates a policy of military self-reliance: "... the prudent prince was one who was able to develop his own military arsenal and rely on it alone and never, unless compelled by necessity, on the power of allies."8 Indeed, it is the non participation in military alliances that the Euro-neutrals seek to preserve and which they refer to as the "core" of their neutrality policies today. Ironically, the "principle of proportionality" which meant so much to Machiavelli, and means so much to the Euro-neutrals, is echoed in the EC's "principle of subsidiarity," which has been given particular attention with the EUT's development to ensure that over centralization in the EU's decision-making process does not occur. In essence, therefore, this indicates that the Euro- neutrals have much to bring the EU in their accumulated knowledge on the application of this authentic principle of pragmatism.

*Greg Russell, Hans J. Moraenthau and the Ethics of American Statecraft♦ Baton Rouge: Louisiana State University Press, 1990, 28. For more analysis of Machiavelli see also: Herbert Butterfield's The Statecraft of Machiavelli (London, 1956); and, Friedreich Meinecke's Machiavellianism: The Doctrine of "Raison d'ftat" and its Place in Modern History, trans. by D. Scott. (New Haven: CT, 1957).

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 5 7 Definitions Neutrality, as it was practiced in the days of Thucydides, was generally a self-proclaimed policy declared at the time of war, and thus operated on a case-by-case basis. Whether it was successful or not depended primarily on whether the warring states chose to heed the neutral's declaration, as was the case for Melos during the Peloponnesian War, which Athens decided to absorb, despite its profession of neutrality. Thus, "[n]eutrality ... is not a fact, but an accomplishment."9 After WWII and the emergence of the bi-polar Cold War environment, various anomalies of the concept of neutrality emerged, and developed outside the traditional confines of the European continent. These variants principally included neutralism and non-alignment. Since the end of WWII, the concept of neutrality has grown to mean many things to many people, and has become all the more conceptually "messy." Consequently, it is not uncommon for students, scholars, and politicians alike to apply the terminology as if the concepts neutrality and non-alignment are interchangeable

’Bill McSweeney, "Postscript: The Case for Active Irish Neutrality." In Ireland and the Threat of Nuclear War. 179-203: 182.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 5 8 and synonymous. Indeed, [w]ithin the hallowed grounds of academe, language is used - or is presumably used - to clarify thoughts and subjects; in politics and diplomacy, it is frequently employed to obscure both these useful purposes in their respective spheres.10 Unfortunately, such malleability has resulted in aberrations of the distinct terms, which does a great disservice to the nations that practice the various policies since it gives them a rather nebulous and ambiguous existence. Yet it is difficult to find any cogent definition which can embrace the divergences found among the several states discussed in this study. While several definitions exist and are the cause of many arguments, not least amongst the NNAs themselves, let it suffice to say preliminarily that neutral countries profess the ideological status of impartiality and elect not to participate in war between other countries," while non- aligned nations profess a more activist approach in their desire to "democratize" international relations by encouraging close relations amongst all countries,

'“Robert G. Neumann, "Austrian Neutrality - Precursor of Detente?" In The Austrian Solution; International Conflict and Cooperation, ed. Robert A. Bauer, 142-153, Charlottesville, VA: University Press of Virginia, 1982, 142. Thus, while academe generally attempts to clarify terminology, politicians generally use terminology to serve their own interests. However, when arguments exist even within the academic realm on just what the terms mean, as is the case for neutrality and its anomalies, this only provides politicians more room to wreck havoc on the terms.

"Bengt Sundelius, "Introduction." In The Neutral Democracies and the New Cold War, ed. B. Sundelius, 1-10. Boulder, CO: Westview Press, 1987, 4.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 5 9 regardless of their ideologies.12 Furthermore, while the concept of neutrality has been around for centuries, and was primarily generated in Europe with the reality of the balance-of-power politics of, especially the 19th century, the contemporary non-aligned movement had its origins in 1961 with the Belgrade Conference, founded on the initiative of Yugoslavia, India and Egypt. While this first meeting only consisted of 25 participants, the non-aligned movement (NAM) has grown to over 100 members today, most of which are Third World nations.13 Moreover, there tends to be an assumption that a state opting for neutrality does not have an interest in foreign relations, and instead prefers isolationism. However, neutrality of the 20th century has become increasingly "active" in foreign affairs issues.14 During the "you are either with us or against us" mentality of the Cold War, those who tended to be the most confused over the existence of neutrality were politicians from either side of the bloc system - West, where John Foster Dulles referred to neutrality as "immoral" and East, where the general attitude

12A.W. Singham and Shirley Hume. Non-Alignment in an Age of Alignments. Westport, CN: Lawrence Hill & Co., 1986, 15.

13Ibid, 1.

14McSweeney, "Postscript: The Case for Active Irish Neutrality," 182-184.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 60 of the Soviet Union toward Yugoslavia15 since the days of Tito was similar to the Dulles conviction, although not quite as harsh. Rather, the Soviets primarily viewed neutrality as a tool which they could use to their advantage.16

Neutralism and Neutralization Neutralism is "... a political term that sometimes also is used to mean a status of non-alignment or bloc- free." For example, it is a policy that Cuba professes to practice.17 "Neutralization" is an essentially legal arrangement by which a country accepts, either unilaterally or as part of a treaty or general agreement, a certain limitation on its own action or sovereignty, precluding its

'Jugoslavia claimed to practice non-alignment rather than neutrality.

l6Philip Windsor, "Neutral States in Historical Perspective." In Between the Blocs. 3-9: 6.

17Neumann, 142.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 61 entry into an alliance.18 'Neutralization [is] a flexible instrumentality of statecraft. Its role is ... to search for ways to remove minor states from arenas of destructive regional and global competition. In an area of stalemate and standoff, there is room in diplomacy for techniques designed to transform military stalemates into political stalemates. Neutralization offers the possibility for such a transformation ... especially those wherein a minor state is the scene of domestic strife and competitive intervention'.19 As concerns the relationship between neutralization and neutrality, "'one might characterize neutralization as an alliance to not align with a specific state, and neutrality as a declaration by a state not to align with others. In this fashion, neutrality and neutralization represent dual versions of a similar posture.'"20 Thus, while neutralization and neutrality tend to be conceptually grouped together, and have existed for centuries prior to the Cold War, non-alignment and neutralism are grouped together and have emerged as a reaction to the Cold War.

18Ibid, 143.

’’Quoted from C.E. Black et.al. Neutralization and World Politics (Princeton, 1968), in Joseph Maila's "Buffer States: The Issue of Sovereignty," in Buffer States in World Politics ed. John Chay and Thomas E. Ross, 29-40. Boulder, CO: Westview Press, 1986, 34. An example of a plan for neutralization was proposed by the United Kingdom for Afghanistan after the Soviet invasion in 1979.

“Quoted from N. Choucri's "International Nonalignment," in M. Haas' A Behavioural Approach (NY, 1977), in Maila's "Buffer States: The Issue of Sovereignty," 34.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 62 Neutrality and Permanent Neutrality Since the end of WWII, neutrality has taken on a political meaning because it applies during both wartime and peacetime. Therefore, in order to be considered as a neutral nation during a potential future war, nations that wish to preserve this right must function during peacetime in such a way as to ensure their neutrality during war. In turn, this relies heavily on a nation's ability to secure its independence of action and unfettered reliance on other nations for its economic, security and defensive well-being. Thus, a minimal amount of, if any, reliance on others is crucial. As such, a neutral must refrain from making commitments in peacetime that could foreseeably compromise its freedom of action in a future conflict: [tjhough deriving its raison d'&tre from the state of war and having its ultimate political, as well as only legal, significance in warlike situations the successful implementation of neutrality requires meticulous preparation in peacetime.21 A practicing state's former Prime Minister aptly described the centrality of the credibility factor in practicing

2,Karsh, 108.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 6 3 neutrality: [i]f we make commitments in peacetime that make it difficult for us to maintain neutrality in wartime, then security is transformed into insecurity. If we deprive ourselves in peacetime of the possibility of pursuing an independent foreign policy then proud declarations are similarly transformed into ineffectual phrases.22 Moreover, according to the tenets of international law, the obligation of upholding neutrality rests on both the side of the state claiming neutrality and the side of the bellicose states. The 1907 13th Hague Convention states: "' [b]elligerents are bound to respect the sovereign rights of neutral powers and to abstain, in neutral territory or neutral waters, from any act which would, if knowingly permitted by any power, constitute a violation of neutrality'."23 As such, since neutrality has come to be practiced in both wartime and peacetime environments, its name has changed to "permanent neutrality".24 The phenomenon of "permanent neutrality" is unique to Europe and consists of two variants: 1) de jure (legal) permanent neutrality as practiced by Austria and Switzerland and 2) de facto (factual) permanent neutrality as practiced by Sweden and Finland. In the "legal" form, both Switzerland

2"Carlsson Presents Views," FBIS-WEP-90-119. 20 June 1990, 39.

^Hanspeter Neuhold, "Challenges to Neutrality in an Interdependent World." In Between the Blocs. 83-97: 87.

Permanent neutrality officially involves both a mutual undertaking established by a unilateral declaration and its acceptance and the customary framework provided by the international law of neutrality.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 6 4 and Austria have obligations under international law to uphold their respective neutrality since it was "granted" to them by the Great Powers.25 On the other hand, in the "factual" cases of Sweden and Finland, these two nations more-or-less "choose" to be neutral. Although it can be argued that Finland is within the "legal" form and Switzerland is within the "factual" form, all four have practiced neutrality as if under international law so as to increase and enhance the credibility of their respective neutral status. While the expression "permanent neutrality" was first used during the negotiations at the 1815 Congress of Vienna for the then great powers to "neutralize" Switzerland (thereby guaranteeing its neutrality), Switzerland, in fact, had been practicing a policy of neutrality since 1648.26 Sweden has been observing the principle of neutrality since the early 19th century, but without having entered into any legal obligation to this effect. Therefore Sweden tends to be sensitive about the term "permanent" neutrality, since it views this implication as a threat to its independence of

^ o r example, in Austria's case, its 1955 unilateral Declaration of Neutrality established the legal basis for its neutrality moreso than did the 1955 bilateral Moscow Memorandum or the 1955 multilateral State Treaty. This is further discussed in Chapter III.

“The 1648 Treaty of Munster established Switzerland as an independent state and ended Switzerland's expansionist ambitions after the battles of Marignano and Pavia early in the 16th century. See: Kennedy and Specht, 410-411.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 6 5 action. On the other hand, both Austria and Finland adopted neutrality after WWII, and largely because of the Soviet Union.27 Neutrality in the national context is further discussed in the next chapter.

Non-a1ignment "Permanent neutrality" is not the same policy that has been practiced in the post-WWII de-colonialized nations within Africa, Asia, or Latin America.2® Rather, the practice of non-alignment emerged as a reaction to both the de-colonialization process by the great European powers as well as the emerging East-West conflict between the two superpowers. The non-aligned movement (NAM) focuses on the North-South struggle in international affairs and the discrepancies between the haves and the have-nots, in a way the Euro-neutrals have not had to consider since they are comparatively well-off economically. While Leo Mates has gone as far as to claim that "...nonalignment is completely

nIn exchange for the removal of Soviet occupation forces, Austria declared its neutrality in 1955. The 1948 bilateral Treaty of Friendship, Co-operation, and Mutual Assistance with the Soviet Union effectively required Finland to practice a pro-Soviet, asymmetrical brand of neutrality.

aFor example, Costa Rica is a self-professed neutral since 1982. It claims to practice an "active, unarmed and permanent neutrality". Technically, this is a contradiction in terms. In order to be permanently neutral, a nation must be able to defend itself. It would not be able to do this if it were unarmed. Thus, in practice, Costa Rica's policy is more akin to non-alignment.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 66 different from the concept of neutrality...,"29 this statement is not entirely correct, as is discussed below.

Similarities and Differences While neutrality during the Cold War was primarily a device for the highly industrialized European nations to remain outside of the East-West ideological conflict, non- alignment during the Cold War was an attempt by less developed countries to seek a greater voice in international affairs (even within the East-West struggle), yet by not allying themselves with one side or the other. In other words, the non-aligned nations would accept aid from a communist state just as quickly as from a capitalist state simply because they, unlike the Euro-neutrals, could not afford to be "choosy." As such, during the Cold War, the NAM could be seen more in North-South terms, whereas neutrality was strictly seen in East-West terms. By so saying, however, this does not mean that neutrality did not exist prior to the Cold War. Indeed, in today's changed circumstances it is the NAM more than the Euro-neutrals, that is trying to find a new role, indicating that the NAM was closely attached to the bi-polar system as well. Today

^Leo Mates, Nonalianment: Theory and Current Policy. Dobbs Ferry, NY and Belgrade: Institute of International Politics and Economics, Belgrade and Oceana Publications, 1972, 9.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 6 7 it will focus on the North-South element of the conflict.30 Accordingly, the most prominent similarity between neutrality and non-alignment during the Cold War was in their respective objections to participation in either of the bloc's military alliance systems. However, in the case of non-alignment this was implicit by political maxim, from which each non-aligned nation could deviate at will, while in the case of neutrality, this was explicit in international law, and any deviations would directly impact the credibility factor of neutrality.31 Regarding the armaments race, although both groups have been vociferous in condemning it and encouraging disarmament in the quest for a more peaceful international environment, the Euro-neutrals will be the last to lay down their own arms, although they encourage others to do so. Indeed, when a country is neutral, it has an obligation to provide for its own defense.

“william Branigan, "Non-Aligned Movement in Summit Seeks Post-Cold War Role." Washington Post. September 2, 1992, A26. See also: Non- Alignment in the 1990s: Contributions to an Economic Agenda. South Centre, The Non-Aligned Summit in Jakarta, August 1992.

3IMates, 346.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 68 As long as other states maintain armed forces, permanently neutral states must follow suit. Consequently, a shift to civil, i.e. nonviolent, defense is out of the question, even if the political conditions in a permanently neutral state would seem to ideally lend themselves to this alternative to armed violence. Instead of leading the way in laying down their weapons, the permanently neutral countries are, on the contrary, the last states allowed to do so.32 Moreover, as disarmament occurs, the Euro-neutrals want to ensure it is done in a balanced fashion, so that the balance-of-power is not threatened. This explains why the era of detente was particularly significant to the Euro- neutrals. They did all they could to preserve the status quo as reflected in their joint efforts within the CSCE.33 Nevertheless, however dissimilar the two groups are in legal and economic terms, they are similar in that they have only so much influence over their own fates amongst the greater powers. Indeed, both groups have worked together in the CSCE under the NNA circle and all four Euro-neutrals have guest status with the NAM summit meetings.34 Given

^anspeter Neuhold, "Permanent Neutrality and Nonalignment." In The Austrian Solution. 183-184, emphasis added.

MIt is important to note that as reductions in armaments occur during the post-Cold War era, mutual verification and certification of the remaining quantities of weapons will grow in importance. In other words, while there is not much of a difference between possessing 1000 or 900 warheads, there is a big difference between having 50 or 25. The NNA group attained much practice in this through the CSCE during the Cold War because of their impartial status, so they will likely be the leaders today in this procedure of growing importance.

^The category of "guest" was introduced at the 1970 Lusaka Summit primarily for liberation movements, but on an Austrian initiative, it was extended to European states not aspiring to full membership. Finland had observer status with the NAM since 1964 during the Cairo

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 6 9 this reality, and despite the end of the Cold War, it is likely that the Euro-neutrals will continue to coordinate with the non-aligned nations in an effort to grapple with their commonality as small states in a world of large states. Neutrality Law versus Neutrality Policy The father of modern international law, Hugo Grotius, referenced neutrality in his writings during the 17th century. He stated that ”... it will be in the neutral's advantage ... to have treaties with both parties to a war, so that with the good will of both sides they may be permitted to stay out of battle and perform the common offices of humanity for both.”35 During the 18th century the international law writings of Vattel identified a more impartial approach by neutral states during wartime: ”'[n]eutral nations... are those who take no one's part, remaining friends common to both parties, and not favoring the armies of one of them to the prejudice of the other.'”36 During the 19th century, international law and its relation

Summit and gained guest status with Austria in 1970; Sweden since 1973; and Switzerland since 1976. The Irish have not been affiliated with the NAM. See: Harto Hakovirta's "Effects of Non-Alignment on Neutrality in Europe: An Analysis and Appraisal," Cooperation and Conflict 28, no.l (1983), 57-75.

^u g o Grotius The Law of War and Peace. New York: Publishers for the Classics Club, 1949, 386.

^Quoted in Lawrence Oppenheim's International Law. London: Longmans Green, 1935, 494.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 7 0 to neutrality was heavily influenced by the growing importance of diplomacy. For example, in the 1856 Declaration of Paris, neutral goods being carried on enemy ships were not to acquire enemy character. This revealed an element of concern by the warring states over the possibility that if they pushed too hard, they might push the neutral into a corner that might make them join the adversary. Thus, neutrality came to be taken more seriously by the great powers. The laws of neutrality were most recently codified in the Fifth and Thirteenth Hague Conventions of 1907. Because wars were mainly armed conflicts, the international law of neutrality - like the law of war - focused on military obligations and rights.37 These conventions also had special sections devoted to land/conventional war and sea/maritime war. According to the Hague Conventions, permanent neutrality and customary law can be divided into four categories of obligations: abstention, prevention, impartiality, and tolerance. Thus, a permanent neutral must rely on its own defenses since it cannot be a member of a military alliance. In addition, it cannot allow the establishment of foreign military bases on its territory.38

^Neuhold, "Challenges to Neutrality in an Interdependent World," 84.

^euhold, "Permanent Neutrality and Nonalignment," 162-8.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 7 1 Although such laws are important as a baseline in the practice of neutrality, as Professor Bill McSweeney of the Irish School of Ecumenics states "[t]he fact is that international law is only a minor factor determining the possibility of neutrality... it would be foolish to expect [a state] ... to be able to accomplish neutrality in the event of war simply by declaring it."39 Indeed, there are no rules in international law which guide neutrality during peacetime, since neutrality is envisioned to operate during wartime. This has resulted in the development of neutrality policy. As a former Swedish ambassador to the United Nations states: "... it is logical that non-participation in alliances is the fundamental requirement - so fundamental that the really correct definition of our policy is 'non participation in alliances in peacetime aiming at neutrality in the event of war.'"40 Thus, the ability to practice feasible neutrality during wartime has placed a heavy burden of responsibility on a state during peacetime to appear to be sincere in its right to be neutral. "In this sense, the permanent neutral is under constant pressure to live up to its past conduct and declarations."41 Therefore, perception

McSweeney, "Introduction: Some Arguments Against Irish Neutrality," 11-12, emphasis added.

®Sverker Astrom, Sweden's Policy of Neutrality. 3rd revised edn. Stockholm: The Swedish Institute, 1987, 9.

4lKennedy and Specht, 410-411.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 7 2 is reality, and it is critical for a nation which professes neutrality to be able to remain independent in action and avoid any perceivable infringements on sovereignty. Indeed, very few countries have the luxury of finances to be able to maintain this increasingly expensive policy with the continual rise of interdependence in international affairs. While neutrality law rests within the tenets of international law, neutrality policy is the chosen path of each neutral state. Indeed, it is within the "policy" area that a neutral state implements its specific national interpretation of neutrality law. After WWII, with the emerging bi-polar environment, the rise in perception and credibility of a neutrality policy grew immensely. As such, not only was it vital for a neutral to prove its legitimacy during wartime, but especially during peacetime, so that if war did break out, a neutral's policy would be taken more seriously. This suggests the evaluation of a successful policy of neutrality in the terms of realpolitik: a given policy of permanent neutrality will only be as effective and valid, as trusted and valued abroad.42 Thus, interpreting neutrality strictly through international law is to understand neutrality as an end in itself.

^Wolfgang Danspeckgruber. "Implications of Current European Economic and Political Developments on Neutrality - A Comparison Between Ireland and Austria, Sweden, Switzerland." In The European Neutrals. The Council of Europe and the European Communities, ed. Stefan Huber and Fried Esterbauer, 71-96. Centre International de Formation Europ§enne (CIFE) Austria Publications, vol.9. Vienna, Austria: Wilhelm Braumuller, 1988.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 7 3 However, the fact is that the law is only half of the picture, and perhaps the less important of the two halves. Understanding neutrality as a process is critical. As McSweeney explains: [I]t [is] the planning, negotiation and management, rather than the legal conventions, which determine[] neutrality's success. Of course, neutrality requires a declaratory base and the support of any agreements, laws or conventions which may strengthen it and sharpen its public image. But these are like ... [a] trade agreement [rather than like trade itself]. What matters is what is accomplished afterwards.43 Therefore, although neutrality law is the same for the Euro- neutrals, neutrality policy is not. Indeed, neutrality policy is "... the most extreme manifestation of the aspiration to assure one's security through the avoidance of identification with or reliance on additional states,"44 yet this is directly influenced by the external environment in which the neutral state finds itself. In the cases of Austria and Finland during the Cold War, their application of neutrality policy was necessarily more stringent than that of Ireland, Sweden and Switzerland, since they had to take realpolitik into account as regards the Soviet Union.45

McSweeney, "Postscript: The Case for Active Irish Neutrality," 182.

^arsh, 80.

^After WWII, while both Austria and Finland had limits placed on their defensive capabilities, Sweden and Switzerland did not. Instead, Sweden and Switzerland focused on maintaining a viable defense thereby enhancing the likelihood of not being violated during a potential war by elevating the "price" of entrance and occupation by a potential belligerent.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 7 4

External Factors Influencing Neutrality There are principally three external factors which directly affect a neutral's ability to practice viable neutrality: geo-strategic location, balance of power, and international cooperation.46 Geography, perhaps more than any other feature, determines whether or not neutrality can be viably practiced and maintained. Indeed, geography provides a large part of the explanation on why the transferability of neutrality is so inappropriate. Nations which are located on the periphery of great power rivalry ("rim-states"), such as Ireland, have a better chance of maintaining neutrality than do those which are located in the center of confrontation ("buffer-states"), such as Austria and Switzerland. But Switzerland is surrounded by mountains, which have provided an essential barrier to potential aggressors over the centuries. On the other hand, during WWI and WWII, such buffer states as Belgium and the Netherlands were not as successful in their neutrality attempts, largely because of unfavorable location and lack of a viable defense. In addition, the balance of power has been, and remains very important to neutral states. As long as no one power becomes too powerful, and as long as each state can

*Karsh, 81.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 7 5 effectively annihilate the other, neutrality can be legitimately preserved. There are generally two ways of interpreting the balance of power system: as one of distribution of power between individual states or as one of distribution of power between coalitions of states. Overall, the balance of power theory deserves credit for explaining why states collectively prevent total domination by one of their peers and only rarely completely destroy one another.47 Therefore, although the East-West conflict has subsided, Europe is now, in many ways, back to where it was during the 19th and early 20th century balance of power system, with instability shaking the foundations of Europe and Great Russian nationalism looming at the borders of these states. In this way, perhaps neutrality is even more important to maintain today than it was during the Cold War. Because of the emergence of the peacetime element of neutrality, complications have risen in trying to balance independence of action with a growing interdependence in the world. However, the Euro-neutrals have been able to bridge this gap, although to varying degrees. With increasing interdependence particularly in the economic realm, the way the Euro-neutrals have bridged the gap has been through the

^Hans Morgenthau. Scientific Man vs. Power Politics. Chicago: University of Chicago Press, 1946. During the Cold War, dStente was a particularly good period for the Euro-neutrals, since they essentially had the most to gain from this decline in hostilities, as reflected in their joint actions in the CSCE process.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 7 6 EFTA. However, with progressive integration beyond an FTA, these countries have had to consider ways through which to handle deeper integration while retaining credible neutrality. Illusions of Transferability Neutrality has long been viewed as something a nation can immediately acquire on a whim so as to ensure its own interests and self-preservation, somewhat in the form of a "quick-fix." However, while choice, a dynamic factor, is an element within practicing neutrality, it is far from the only element since geopolitics and economics, more constant factors, are additional elements which play a crucial role in practicing neutrality. This fact should be "... a sobering lesson for those tempted to regard the resort to neutrality as a cheap, easy and safe means of dealing with the complex pressures of the late Twentieth Century."4* Ironically, nowhere is the basic misunderstanding about neutrality's transferability more blatant than in the CSCE's 1975 Helsinki Final Act which declares in its Principle I that the participating states "...'have the right t o neutrality. '"49 Neutrality is not as easily adopted as this implies since its viability rests so much on

^Quoted from Jonathan Luxmoore's "Preface" to Stephan Kux's Europe's Neutral States; Partners or Profiteers in Western Security? London: Alliance Pubs., 1986, 6.

^Quoted from Stephan Kux's Europe's Neutral States, fn 5, 40. Taken from: The CSCE Final Act.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 7 7 credibility and consistency. Thus, its transferability to Eastern and Central European nations is somewhat dubious.50 Indeed, in order to maintain a credible neutrality, a state must be both economically stable and well-equipped in its national defense structure. As Salmon explains, while "... it is clearly implicit that a high degree of economic self- sufficiency and a significant defense capability are a sine qua non of proper neutrality... it is [not] sufficient for a state to declare itself neutral... [since this] obscures the divergences between rhetoric, behavior, and conceptual integrity. "51 Most recently, former republics of the former Soviet Union have made references to adopting neutrality. In March 1992, Kyrgyzstan indicated that it hopes to "build a Switzerland in Central Asia." Its President Askar Akayev is making efforts to obtain permanent neutrality for his country.52 However, not only does Kyrgyzstan not have the economy it needs to maintain a credible policy of neutrality, it does not have the capability to defend

®For example, before, during, and after the Cold War Hungary made references to acquiring a neutrality status. See: Alfred Reich's "Hungarian Neutrality: Hopes and Realities,” in Report on Eastern Europe: Radio Free Europe. 1, no.13 (March 30, 1990): 11-22 and "The Hungarian Dilemma: After the Warsaw Pact, Neutrality or NATO?” in Report on Eastern Europe: Radio Free Europe. 1, no.15 (April 13, 1990): 16-22.

5ITrevor Salmon. "Book Review: S. Victor Papacosma and Mark R. Rubin's Europe's Neutral and Nonalianed States. Wilmington: DE, 1989." International Affairs 66, no.2 (April 1990), 394-395, emphasis added.

“Jonathan Steele "Kyrgyzstan Hopes to Build a Switzerland in Central Asia." Manchester Guardian (March 19, 1992), 4:6.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 7 8 itself. Perhaps its model should more appropriately be along the lines of Costa Rica's "unarmed, permanent neutrality". In addition, in August 1993, Belarus of the former Soviet Union, made references to adopting neutrality, in lieu of its nuclear disarmament. However, Belarus readily acknowledged that acquiring this status is a "worthy, beautiful dream, and for the time being we are just dreaming.1,53 Nevertheless, since neutrality is an evolving concept, it can be adapted to new circumstances. The possibility that such nations will be able to acquire a variation of neutrality during the post-Cold War era is not an impossibility.

Neutrality Realists vs. Neutrality Idealists There are generally two schools of thought within the rationale for neutrality in international politics: the realist school and the idealist school. Within the realist school, neutrality is viewed within the context of the balance of power system. Neutrality is viewed as a policy for certain small states which are in strategic locations between great powers. It is a pragmatic, realpolitik approach to the international environment of powerful, larger states, with its aim being preservation of

^"Defense Minister Interviewed on Neutrality," FBIS-S0V-93-159. 19 August 1993, 60-61.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 7 9 sovereignty and national identity.5* On the other hand, the idealists view neutrality as the ultimate route for world peace and consider neutrality as something all nations should aspire to, with the Euro-neutrals serving as "models" for other states to follow. Thus, the idealists (which do not include the Euro-neutrals), strongly believe in the transferability of neutrality as a potential "quick-fix" for troubled areas in the world. In fact, however, this line of thinking is more attuned with the principles of the NAM, and does not acknowledge the uniqueness nor the requirements of practicing neutrality. Two Approaches to European Integration After WWII, various plans for Europe's overall recovery were plentiful. What had once been primarily relegated to academia regarding European integration, was now ready for application. The primary catalyst behind these collective schemes was largely the concern over keeping Germany securely within Western Europe by providing it with a regional framework. Among the various designs emerged the Council of Europe in 1949, the European Coal and Steel Community (ECSC) in 1952, and the Pleven Plan for a European Defense Community (EDC) which was defeated by France in 1954. A more modest plan followed the defeated EDC and was called the Western European Union (WEU). In

^anspeckgruber, 71.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 8 0 addition, plans emerged for a European Political Community (EPC), but since these plans were linked to the success of the EDC, they too ultimately failed, largely because of their premature nature for a Europe just recovering from war and not yet ready for such advanced and committing designs. Instead, integration of a more immediate nature, such as in the economic sector, was much more feasible at this point in time, although the definitive goal for some European nations remained ultimate political union. It was inevitable that two very different visions for European integration emerged: the so-called "functionalists" and "federalists." Evidence of a clear split between the two groups emerged during early Council of Europe and Organization of European Economic Cooperation (OEEC) meetings.55 The federalist group, led by France, tabled the ambitious FINEBEL plan for a customs union between France, Italy and the Benelux.56 The functionalist group, led by the United Kingdom, quickly formed UNISCAN57 largely in

“During a 1949 speech to the OEEC by the administrator of Marshall Plan aid, it was revealed that the United States placed great importance on the progress of European integration. Consequently, the two groups went about such integration plans in two distinct approaches.

FINEBEL" derived from the Franco-Italian, Netherlands, Belgium, and Luxembourg name combination. A customs union requires a common tariff amongst its members and a common commercial policy toward outside parties.

^UNISCAN stood for the United Kingdom-Scandinavian word combination. The three Nordic countries included in the UNISCAN framework were Denmark, Norway and Sweden. Although geographically the term "Scandinavia" is descriptive of the Scandinavian peninsula (Norway, Sweden and Finland), the term "Nordic" applies to all three plus Denmark

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 8 1 reaction to the discussions amongst the five and as an effort to get the customs union idea out of the OEEC framework, by reaffirming the free trade area option,58 "The Scandinavian countries ... were ardent supporters of the British position almost every time European market politics [were] discussed.... the UNISCAN framework ... was mainly an attempt to facilitate payment transactions, but it also demonstrated the formation of a British-Scandinavian convergence.59 The FINEBEL plan did not materialize, but was ultimately replaced by the ECSC, and eventually the EEC and the EURATOM which represented the six countries60 committed toward a vision of a "United States of Europe." Nevertheless, Britain was successful in ensuring that the Council of Europe would remain an inter-governmental rather than a supranational organization. In turn, Britain's success was fuel for the federalist fire to form the ECSC, EEC and EURATOM. It was visionary Frenchman, Jean Monnet, first President of the ECSC's High Authority, who perhaps defined the two different attitudes toward European

(including Greenland), Iceland and the Faeroe Islands.

®An FTA only requires the elimination of import tariffs and quotas amongst its members.

^Carl-Einar St&lvant, "Nordic Policies Toward International Economic Cooperation." In Foreign Policies of Northern Europe, ed. Bengt Sundelius, 107-142. Boulder, CO: Westview Press, 1982, 113.

®The Six were France, the Federal Republic of Germany, Italy, Belgium, the Netherlands, and Luxembourg.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 8 2 reconstruction and the pace of integration most clearly and eloquently: " ... the price of victory was the illusion that it was possible to keep what one had without having to change.”61 Not surprisingly, amongst the functionalist group were the Euro-neutrals: both the Nordic group (Sweden and Finland) and the Alpine group (Austria and Switzerland).

Euro-neutrals/ Approach to European Integration The Euro-neutrals' approaches to the emerging post- WWII European integration processes were not necessarily "unified.” Decisions to participate in or to forego participation in the various regional and international organizations which began to emerge during the late 1940s through the late 1950s were approached on a case-by-case basis by each of them. However, for essentially identical reasons, the three Euro-neutrals (Austria, Sweden and Switzerland), chose to refrain from membership in the emerging supranational organizations, as exemplified first by the ECSC, and later by EURATOM and the EC.62 Thus, the commonality for the Euro-neutrals in refraining from EC membership was in their collective view that supranationality would perceivably infringe on practicing a

“Pedersen, "EC-EFTA Relations: An Historical Outline," 23.

®A11 three organizations, institutionally combined under the 1967 Merger Treaty and collectively referred to as the European Community or the Common Market, envisioned the formation of a "European Union" as the ultimate goal.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 8 3 policy of neutrality, since the supranationalism process requires a pooling of sovereignty, and one of neutrality's obligations is to remain independent in action and avoid any perceivable infringements on sovereignty. Accordingly, above and beyond the obligations for upholding neutrality law (no military alliances, no foreign military bases, no participation in war, and a strong self-defense capability), there are additional considerations for the Euro-neutrals in their participation in non-military bodies. The importance of the perception factor fluctuates within each brand of the Euro-neutrals' neutrality policy, and in turn, factors into the credibility of that policy. Therefore, a neutral nation has the choice to be as stringent or as flexible as it cares to be in practicing a policy of neutrality, with the trade off being how seriously its profession of neutrality is to be taken by other nations during both peacetime and wartime. Nevertheless, it should not be overlooked that each of the three Euro-neutrals were comparably well-off economically and could economically afford not to join the EC at this time. United Nations, Council of Europe and OEEC Sweden, comfortable with its self-chosen neutrality, was the only Euro-neutral to be a founding member of the UN in 1946. Although both Austria and Finland first applied for membership in 1947, the Soviet Union objected. Austria

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 8 4 had to wait until it became a sovereign state to join. This finally occurred in December 1955, and Finland joined with Austria. By 1958, the Soviet Union clarified its position that "[n]eutrality.... fully corresponds to the spirit, letter and aims of the United Nations."63 However, entirely by its own choice, Switzerland remains an observer to the UN, although it participates extensively in various UN committees, so can arguably be considered as a de facto member.64 Gerhard Mally describes the Council of Europe as an "... intergovernmental organization purporting to promote European unity mainly through cultural, as well as social and legal cooperation.,,6S In addition, the Council's discussions were limited in scope so as not to duplicate efforts in national defense, which were discussed in other evolving European platforms.66 Finally, the Council was limited to making "recommendations." Accordingly, its obvious lack of supranational overtones and its non-

Quoted from the Soviet Yearbook for International Law for 19S8 in Karl Zemanek's "Neutral Austria in the United Nations," International Organization XV, Summer 1961, 414.

‘‘Switzerland last held a referendum on full membership in the UN in 1986. It was negative.

“Gerhard Mally, The European Community in Perspective. Lexington: D.C. Heath and Co., 1973, 144.

“Article 20(a) of the Statute of the Council of Europe, 5 May 1949, and Article 1(d). See: A.H. Robertson, The Council of Europe: Its Structure. Functions and Achievements. 2nd edn. (London 1961), at 257-69 for the Statute.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 8 5 reference to defense made it a particularly appealing organization for Euro-neutral membership. Both Sweden and Ireland were founding members, since they viewed the organization as having no military affiliations. Although Austria first applied for Council of Europe membership in August 1950, it did not join until 1956, for similar reasons as above. Switzerland postponed formal membership until 1963, once it had ascertained that the Council of Europe was not a political or military alliance. However, prior to formal membership, both Austrian and Swiss observers had contributed to Council of Europe debates. Despite the Council of Europe's lack of supranational implications, Finland held only observer status until 1989, when it finally became a full member. The implementation of Marshall Plan aid in the European Recovery Program, which was managed through the OEEC, did not in itself pose problems for the Euro-neutrals, apart from Finland.67 Sweden, Austria, and Ireland participated without any hesitancy, while Switzerland insisted on a neutrality reservation, should the organization evolve into a bloc institution. Thus, it is clear that Switzerland, more than any of the other Euro- neutrals, chose to be the most stringent in its approach to

‘’Finland participated in the OEEC as an observer from 1956 to 1967 (transformed into the OECD around 1960), and joined as a full member in 1968.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 8 6 integration, thereby, in its opinion, making it the most legitimate neutral of the lot.

Nordic Integration In 1948, ideas for a Nordic customs union were considered which would "... compris[e] about 90 per cent of mutual trade and ... extend co-operation in research, financing and trade policy."68 Given the similar histories and close cultural ties amongst the Nordic countries, this aspiration was not considered as far-fetched: [t]here was a long tradition for co-operation ... in judicial affairs, where a large part of the law of property and other civil law acts had been prepared by joint committees with members from all countries. In periods there had also existed a close monetary co operation, since 1952 a passport union ... and since 1954 a common labour market. Furthermore, members of the five parliaments met each year for sessions of the Nordic council and discussed ways in which to promote co-operation between the countries.69 However, the idea for a Nordic customs union was put on hold during the OEEC's Maudling Committee (discussed below), and by the time such a plan could resurface, another option was available. Indeed, "Nordic solutions are only sought in a committed manner when no other options are available."70 By 1960, the EFTA presented "the other option" and since Norway

®Hans Christian Johansen. The Danish Economy in the Twentieth Century. New York: St. Martin's Press, 1987, 125.

*Ibid.

’“st&lvant, "Nordic Policies Toward International Economic Cooperation,” 114, emphasis added.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 8 7 (as a relatively young nation), did not want to risk being overwhelmed by either Sweden or Denmark, the EFTA, with Britain as its leader, presented the best association for the Nordics, with the broader "European" option winning out over the more confined regional option. Moreover, in 1951 Denmark forwarded an initiative to form the inter-governmental Nordic Council. By 1952, the idea had been accepted by Denmark, Iceland, Norway, and Sweden, and it was functional by 1953. Finland did not join until after the Soviets returned the naval base of Porkala, in 1956. The OEEC's Maudling Committee The OEEC developed the Maudling Committee to address the British initiative for a European-wide free trade area. Britain clearly hoped to "dissolve the Six like a lump of sugar in a British cup of tea" by ensuring the EC would be only one aspect within a wider economic framework, of which Britain would be the leader. Just as Britain, supported by Scandinavia, had ensured the limitations to progress in European integration within the Council of Europe, so they now hoped to provide an "alternative to the supranational European Community."71 However, with France's General de Gaulle's return to power, the "proposal for a pan-European free trade area in which the EEC customs union would have

71 Mally, 80.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 8 8 been one element,n72 was swiftly put to rest. Moreover, the OEEC quickly became "Atlanticized" with the additional memberships of the United States and Canada, converting it to the Organization for Economic Cooperation and Development (OECD). As such, the functionalist vision for a wide European free trade area was put on indefinite hold. Although immersed in the multilateral framework of the OEEC's Maudling Committee, British functionalist and French federalist rivalries cannot be minimized during this first phase of "abortive multilateralism" between the two European integration schools of thought. Their rivalries resulted in the formation of the EC in 1958 and foreshadowed the virtual split of Western Europe into two trading blocs with the creation of EFTA in 1960.

The "Federal" Approach to European Integration The ECSC was the first "supranational" organization with its own executive body, the "High Authority." It was Monnet's hope that the ECSC would be the "first concrete foundation" of the European federation, as stated in the Treaty. Indeed, with the establishment of the EEC and EURATOM only a few years later, it appeared that Monnet's vision had been accurate. However, it did not take long for

^.C. Hine The Political Economy of European Trade; Introduction to Trade Policies of the EEC. New York: St. Martin's Press, 1985, 115.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 8 9 the member states to assert themselves against the federal idea via the EC's Council of Ministers, reaffirming the Council's political role. As John Pinder of the College of Europe in Bruges noted: [t]his reaction of national sovereignty against the federal idea led to a long-drawn-out conflict within the Community, which began with a major assault by General de Gaulle as President of France and has continued to this day, with Britain succeeding de Gaulle as champion of national sovereignty.73 Moreover, the plans for the EDC and the EPC in 1952-54 were destined to collapse from a Europe that was not yet ready to go the "federal route" in such sensitive areas as defense and foreign policy. While the idea was to attempt to pool the armies of the Six just as resources were pooled in the case of steel and coal, it soon became clear that such logic did not apply to such sensitive areas. Led by Euro-federalist Spinelli, the ECSC Assembly devised a "quasi-federal constitution" to complement the EDC Treaty, but the French rejected the plans. With the failure of the EDC, "... many doubted whether the federal idea could recover from this apparently decisive defeat."74 After this defeat, it seemed clear that the political realm of integration appeared too sensitive to approach immediately. Therefore, it is no wonder that the

73John Pinder. European Community: The Building of a Union. New York: Oxford University Press, 1991, 6.

74Ibid.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 9 0 neofunctional theorists devised and reasserted their ideas, that sector by sector, Europe would ultimately evolve into a polity. Now it would be a matter of waiting for "spill over" to occur: "political unification by stealth" as Sir Harry Hinsley put it.75 Despite the lack of integrative progress in such platforms as the Council of Europe and the aborted EDC/EPC, the Six further discussed their aspirations during the Messina Conference of 1955. Britain also participated in the Messina talks, but did not take these continental ambitions very seriously until the group established the EC and EURATOM in addition to the ECSC three years after the Messina talks. With the Six's resolution to work toward a customs union, Britain decided to attempt some "dilution" in the wider economic platform of the OEEC.76 Therefore, the Treaty of Rome was much less ambitious in its political design than the ECSC and the EDC treaties had been, without the use of such red-flag words as "federal" or "supranational" included in the text. It is also worth noting the change in attitude towards immediate union in that the EC's key supranational body was called the "Commission" rather than the "High Authority", with the

^Sir Harry Hinsley, "The European Community: A Body-Politic or an Association of States?" The World Today, vol.45, no.l (January 1989), 1- 3.

76R. Griffiths, "The Changing Concept of Europe." EFTA Bulletin 32, no.l (Jan.- Mar. 1991), 5.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 9 1 primacy of the Council of Ministers reaffirming its intergovernmental nature rather than a federal character.77 Nevertheless, the political goals remained implicit, if not explicit: ... the treaty's preamble continued to stress the political goals of the undertaking - 'of an ever closer union among the peoples of Europe.' In addition, the institutional system as well as the decision-making process, which were to lead to common policies, illustrated the persistence of an integrationist trend.78

The 11 Functional11 Approach to European Integration The collapse of the Maudling negotiations in 1958 resulted in the disgruntled OEEC members holding a December conference which examined the "situation brought about by the collapse of the negotiations for a European free trade area."79 This, in turn, led to the first EFTA negotiations in Stockholm in March 1959, as a retaliation to the failure of the OEEC's Maudling Committee. At that time all participating countries agreed not to sign a bi-lateral trade treaty with the Community without informing the

’’Pinder, 8.

wde La Serre, "Foreign Policy of the European Community," 350, emphasis added.

’’Heinrich Siegler Rustriai Problems and Achievements; 1945-1963 (Bonn, Siegler & Co., Dg., Verlag fuer Zeitarchiv, no date), 55.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 9 2 others. Consisting of the "outer seven" nations80 which preferred the "functionalist" approach to European integration, the primary concern of what became the EFTA was to avoid economic discrimination through the EC's application of a common external tariff (CET). The EFTA's quick formation can be attributed in part to the amount of prior coordination in both the Nordic and UNISCAN frameworks, and can in part be seen as a counterstrike primarily by an "annoyed" Britain that wanted to prove to the Six that an FTA could accomplish goals more quickly than a customs union.81 Within the Nordic grouping, Denmark was particularly concerned about choosing whether to be a member of the EFTA or the EC, since its main trading partners, the United Kingdom and the Federal Republic of Germany (FRG), belonged to different groups. It was therefore in Denmark's best interest to promote the European-wide FTA in order to avoid alienating itself from either one or the other of its major trading partners. However, once the OEEC's plan was

**The "outer seven" nations which formed the EFTA in 1960 consisted of Austria, Denmark, Norway, Portugal, Sweden, Switzerland , and the United Kingdom. Finland formed a special arrangement with the EFTA via the FINEFTA Treaty. It became a full member in 1986.

"indeed, the EFTA was able to establish internal free trade eighteen months earlier than the EC; yet it must not be overlooked that given the EC's higher level of integration, it required a CET, while EFTA did not. Moreover, the EC included the agricultural sector while EFTA did not. Therefore, the FTA that EFTA members established amongst themselves by December 31, 1966 was primarily in manufactured goods. See: Willem Molle. The Economics of European Integration: Theory. Practice. Policy (Brookfield, VT: Dartmouth Publishing Co., 1990), 450.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 9 3 extinguished during the Maudling Committee deliberations, Denmark joined the EFTA only after a confirmation by the FRG that its membership would not be considered an "unfriendly act" and once the United Kingdom and Sweden consented to agricultural concessions for Denmark.82

The First Signs of EFTA Defections In May 1960, the EC decided to expedite its integration by lowering external tariffs even more quickly than had been originally planned. Much to its chagrin, Britain decided the time had come to take the EC a little more seriously. Just one year after the formation of the EFTA, Britain, joined by Denmark, applied for EC membership in mid-1961. This tactic by the virtual leader within the EFTA changed perceptions of what the EFTA as a group could achieve. The British and Danish membership applications were announced simultaneously with the July 1961 EFTA Ministerial meeting in Geneva. The remaining EFTA members responded by issuing a communique which stated that they

“Pedersen, "EC-EFTA Relations: An Historical Outline," 16.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 9 4 regarded the British and Danish decisions as: '... an opportunity to find an appropriate solution for all EFTA countries and thus to promote the solidarity and cohesion of Europe.' In order not to miss 'this new opportunity', all the EFTA member states would 'examine with the EEC the ways and means by which all members of EFTA could take part together in a single market embracing some 300,000,000 people.'" In other words, the EFTA was reaffirming the Maudling Committee's goal of a wider western Europe. Indeed, the "outer seven" had admitted as early as their November 21, 1959 communique (the day the Stockholm Convention was initialled), that they "... had formed a limited free trade area that they hoped would only be temporary."84 It is therefore not surprising when Esko Antola of the University of Turku noted that: "[the] EFTA was ... created from principles and ideas developed for other purposes. There was no special EFTA identity ..,".85 Nevertheless, the EFTA was successful, but "... it remained a second-best solution to the problems of European trade and economics."86 It is critical to stress, however, that the EFTA was considered as not necessarily second-best to the EC, but as

“Frances Nicholson and Roger East. From the Six to the Twelve; the Enlargement of the European Communities (Chicago, IL: St. James Press, 1987), 5, emphasis added.

^New York Times. November 2, 1959, 1.

“Esko Antola, "EFTA and its Limits." In The Wider Western Europe. 223-245: 233.

“stilvant, 115.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 9 5 second-best to the wider western Europe framework.

The Euro-Neutrals and the "Common Front Strategy" Responding to the British and Danish EC membership bids, all three EFTA neutrals (Austria, Sweden and Switzerland) decided to open negotiations with the EC which were designed to lead to Article 238 association agreements. By mid-December 1961, all three Euro-neutrals placed formal applications with the EC. On December 15, the then-Austrian Foreign Minister Bruno Kreisky submitted to Ludwig Erhard (the President of the Council of the EC), the formal application for association. Kreisky stated: [t]he Austrian Government ... has ... devoted careful consideration as to how and in what form Austria could subscribe to an exclusively economic association ... that should take account the maintenance of her permanent neutrality and the fulfillment of her international agreements, as well as the discharge of the obligations thereby entailed, without detriment to the integrity of the Common Market. Austria has arrived at the conclusion that such an agreement is possible on the lines laid down by Article 238 of the Treaty of Rome.*7 Of particular interest is that Kreisky's statement proceeded to include both Sweden and Switzerland, as if the three were a unified bloc, asserting that "... by virtue of their neutrality Sweden and Switzerland ... will have the same kind of problems to discuss and resolve with the Six as

^Siegler, 63, emphasis added.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 9 6 Austria has."88 The cooperative momentum amongst the three Euro- neutrals continued to grow. Three months after submitting their formal EC applications, the Euro-neutrals met in Sweden to develop their negotiating strategy with the EC. They formulated four basic rules for any agreement that might develop with the EC: [f]irst, the treaty-making power must be preserved: although there could be harmonization of trade policies and the closest collaboration on many aspects of foreign trade policy, the sovereign right to conclude trade agreements could not be delegated. Second, freedom of action in time of war had to be preserved, necessitating an autonomous right to suspend commitments which should not, therefore, be irredeemable. Third, strategic interests must be protected but this should not be used as a cloak for economic interest. The institutions of the associations should be separate from those of the EEC itself.89 In addition, by March 2, 1962, Swedish Trade Minister Lange spoke on behalf of all three stating that "[t]he neutrals [have] no intention of restricting, retarding, or interfering with the co-operation of EEC countries. The

Ibid, emphasis added. Indeed, such collectivizing had not been the case for Austria when it pursued membership in the OEEC and the Council of Europe - no attempt was made to reference any of the other Euro- neutrals, with a preference shown by Austria to operate on its own. As such, this latest maneuver implies that Austria was referencing the others in an effort to bolster its own negotiating position. Ironically, the implications of such collectivizing by Austria's own hand haunted Austria during the next eleven years as it attempted to disassociate itself from the other two Euro-neutrals (which ultimately chose not to pursue such close ties to the EC), and get its own arrangement via its Alleingang. This is discussed in greater detail below.

^Stanley Henig. External Relations of the European Community: Associations and Trade Agreements. London: Chatham House, 1971, 130.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 9 7 neutrals [are] prepared to accept any provisions compatible with their own neutrality and integrity of the EEC."90 In addition, it was stressed they "... did not ... wish to use neutrality as a pretext for non-compliance with certain economic obligations."91 On July 28, 1962, Austria and Sweden made their statements to the EC Commission, while Switzerland made its statement two months later. Not unexpectedly, "although the three statements were broadly similar, there were differences of nuance."92 Reflecting on these statements with the benefit of thirty years' hindsight makes one question whether such overtures were double-talk, or simply diplomacy at its best. Indeed, it is important to note the equal footing technique both Austria and Sweden applied in their statements, not only as a gesture of respect to the EC, but also as a reaffirmation of their respective intentions to retain neutrality. Indeed, these statements have an interesting ring of familiarity to the opening statements made to the EC in February 1993 at the start of the current negotiations. Deliberating on the "common front" strategy of the Euro-neutrals for EC association status during the early 1960s is particularly insightful for today's circumstances

*Ibid, 64.

91A. H. Robertson, European Institutions: Cooperation. Integration and Unification. 3rd. edn. New York: Hatthew Bender, 1973, 219.

*Henig, 131.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 9 8 since a form of "common front" strategy has occurred amongst the Euro-neutrals during the current negotiations for full EC and EU membership, if only behind closed doors. After all, many of the same issues which were discussed during the early 1960s, albeit in the framework of association agreements via Article 238, are now being addressed during the full membership negotiation process, via Article 237. Evaluating the experience of the three Euro-neutrals during the 1960s better prepares one in projecting the likely outcome of the current full membership negotiations.93

The First Swedish EC Debate (1960-1963) In Sweden, "... the political calculations took precedence over the economic attraction of possible EEC membership,"94 largely because economically, Sweden could still afford not to join the EC and it had the alternative of the EFTA. Moreover, with the EC's 1961 Bonn Declaration which set up the Fouchet negotiations to work on EC political cooperation, Sweden chose to keep its distance from the EC regarding full membership prospects. As indicated during a 1961 speech to Swedish metalworkers then- Prime Minister Tage Erlander declared: "'[i]f we wish to

®The current EC/EU membership negotiations are discussed at length in Chapter IV.

,4M. Donald Hancock "Sweden, Scandinavia and the EEC." International Affairs 48, no.3 (July 1972), 428.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 9 9 maintain our policy of neutrality, Sweden cannot accept the political objectives of European cooperation. I've emphasized before that Sweden must avoid all commitments that reduce our capacity to maintain, and win confidence for, our neutrality.',,9S Thus, being a pragmatic country, Sweden explored its other options in dealing with the EC so as not to be economically marginalized by it. Given the options under the EC's Treaty of Rome, the Swedish Government, led by the Social Democratic Party, was only prepared to seek an arrangement via Article 238, "Association Agreements," as the Article was interpreted at that time. However, all political parties within Sweden were not in agreement over how to approach the EC. For example, the Liberal and Conservative Parties were strongly opposed to an association agreement, and preferred the full membership option in conjunction with several opt-outs to safeguard Sweden's neutrality. In the middle of the debate, however, France's President General Charles de Gaulle vetoed the United Kingdom's membership application on January 14, 1963 since he viewed Britain's inclusion as a diluting mechanism to the EC's deeper integration goals and as an "American Trojan horse." Because of de Gaulle's veto, the debate in Sweden

^Ibid, 428.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 0 0 was relegated to primarily an esoteric level. Nevertheless, the ideas inherent within this first debate have remained consistent and cogent through today. As a result, "... the 'temporary' EFTA came to have a life of its own."96

EC External Relations Policy The EC was not very responsive to the prospects of allowing neutrals into the club, especially so soon after the issuance of the Bonn Declaration on closer political cooperation amongst EC members. The idea of allowing neutrality to possibly dilute the political aspirations of the EC was an anathema. Walter Hallstein, the President of the EC Commission, actually proposed that the Euro-neutrals abandon their neutrality since he viewed neutrality as being irrelevant, given the extent of integration occurring throughout Europe.97 Hallstein was not alone in his sentiments toward the Euro-neutrals. The Belgian Foreign Minister and former Council of Europe President, Paul-Henri Spaak, felt at least as strongly as Hallstein did in not allowing the EC's political aims to be attenuated by the neutrals' desire for strictly economic arrangements.

96Hine, 118.

^E.F. Aschinger, "On the Eve of the Neutrals' Negotiations with the EEC." Swiss Review of World Affairs XI (January 1962), 1-3: 1.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 0 1 M. Spaak expressed doubts about the desirability of having the neutrals associated with the Community on a number of occasions: in a speech to a meeting in Brussels of trade union representatives from the Six ... [and] to the Assembly of the Council of Europe.98 Thus, despite the collapse of the EDC/EPC, both Hallstein and Spaak were firm believers that economics and politics should not be compartmentalized, although that is exactly what had to occur to get the Treaty of Rome ratified, as Monnet, despite his federalist ambitions, was well-aware. Indeed, during the early 1960s, the EC's external relations policy was in its developmental stages and the varying Treaty of Rome Articles which addressed EC external relations had yet to be clarified. Referencing the Treaty, the three Euro-neutrals identified the type of relationship which they thought would maximize the economic benefits of affiliation with the EC. The Treaty's Article 238 appeared to be the best option. However, the EC's association system began to evolve into something more tailored to the EC's relations with developing countries rather than for developed countries.99 Clearly, the EFTA nations did not qualify as "developing countries;" thus, seeking an arrangement through the association system gradually met

*Miriam Camps, Britain and the European Community; 1955-1963. Princeton, NJ: Princeton University Press, 1964, 422, fn9.

wAs such, the Euro-neutrals did not fully comprehend what the EC intended its association system to be - grooming grounds for nations which aspired for eventual EC membership, or holding grounds for nations which could never integrate with the EC either because of their economic conditions or their geographical position.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 0 2 with EC resistance. The EC's association system is thoroughly discussed in Jacqueline D. Matthews' book of the same title.100 She describes "full association" status (via Articles 131-136) as the most comprehensive type of EC association, without the prospects of the associated country to become an eventual EC member. This arrangement was developed since the full membership Article of the Treaty of Rome (Article 237) stipulates that only European countries may join the EC. Thus, full association was reserved for former colonies of EC member states and encompasses the Yaounde and Lome Conventions.101 On the other hand, "special association" status (via Article 238)102 developed into an arrangement for countries which aspired to ultimate EC membership yet were not currently able to integrate economically,103 as well as for other countries which did not envisage this

10OJacqueline D. Matthews, Association System of the European Community. New York: Praeger Publishers, 1977, chapter 2: 10-32.

l01Part Four of the Treaty of Rome (Articles 131-136) is entitled "The Association of Overseas Countries and Territories."

102Part Six of the Treaty of Rome is entitled "General and Final Provisions." Article 238 is found within Part Six and not Part Four of the Treaty. Article 238 states: The Community may conclude with a third country, a union of States, or an international organisation, agreements creating an association embodying reciprocal rights and obligations, joint actions and special procedures. Such agreements shall be concluded by the Council acting by means of a unanimous vote after consulting the Assembly. Where such agreements involve amendments to this Treaty, such amendments shall be subject to prior adoption in accordance with the procedure laid down in Article 236., emphasis added.

l®At this time, the only such countries were Greece (1961) and Turkey (1963).

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 0 3 possibility, but were economically better off than the former colonial nations.104 Finally, the bi-lateral trade agreements (via Article 113), developed to include the countries that wish to make some commercial arrangement with the EC, but prefer not to become politically linked with the EC.105 As the association system developed during the first ten years of the EC's existence, the EC revealed that it considered association status (via Article 238) as inappropriate for the Euro-neutrals, since they were all clearly in a position to economically integrate with the EC. Indeed the fact that they could integrate with the EC and chose not to rubbed some in the EC Commission the wrong way. In addition, supporting Hallstein and Spaak in their arguments against association status for the neutrals were the geographic positions of the Euro-neutrals. All were "geographically eligible for, and economically capable of, full membership."106 Thus, as Hallstein and Spaak saw it, the Euro-neutrals should simply drop their neutrality if they wanted to join the EC - an "all or nothing" arrangement, typical of the bipolar confrontational

""Eventually, this arrangement included such countries as Morocco and Tunisia (1969), Malta (1971), and Cyprus (1972).

10SThese include Iran (1963), Pakistan (1968), Argentina (1971), Indonesia, Thailand, Philippines and Sri Lanka (1972) and Brazil, India, Uruguay and Bangladesh (1973).

I06Henig, 127.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 0 4 atmosphere already existing throughout Europe at this time. Moreover, the EC was suspicious of the Euro-neutrals7 intentions via an association agreement: ... there was ... an emotional reluctance to accommodate the Swedes and the Swiss, based on the feeling that these countries had profited from their neutrality in the last war and now wanted the advantages of NATO protection without assuming any of the obligations.107 However, this presumption by the EC was somewhat misplaced since both Sweden and Switzerland have traditionally relied strictly on their own defensive capabilities, and had every intention to keep doing so even when they applied for association (as they do today for full membership). In fact, the EC's suspicion missed the point of their interest in the EC and the reasons for their respective applications for association (and membership today): to minimize the risks of economic marginalization. Simply put, "... the neutrals wanted an arrangement between themselves and the [EC] under which they would accept the same economic commitments as members and enjoy the same economic advantages as members but which would permit them to arrive at these results in their own way."108 Thus, request for association status was simply a "damage-control" reaction by the Euro-neutrals once they saw the leader within the EFTA,

107Camps, 497.

"*Ibid, emphasis added.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 0 5 the United Kingdom, place a membership bid. Especially enlightening of the EC's developing external relations policy was the 1962 Birkelbsch Report, produced by the Political Committee of the EC's European Parliament. What is interesting about this Report is that it focuses primarily on Articles 237 and 238 of the Rome Treaty: full membership or association. Article 113 is only referenced in passing and not in relation to a customs union or free trade area. Within this report, the European Parliament clarified the EC's external relations policy and it became clear that EC association agreements would be appropriate only for those nations not yet economically fit to join the EC, but which had ultimate political aspirations to join. As such, "Europe's neutrals ... [were] implicitly criticized for their lack of interest in the Community's political objectives.1,109 Moreover, "... the tone of this Report was noticeably unsympathetic towards would-be associates unless they were economically under-developed. For other European countries there was no right of association: the standard relationship was membership and the countries concerned [the three Euro-neutrals] were explicitly criticized for lack of appreciation of the real nature of the Community.1,1,0 Needless to say, the EC

lwHenig, 37-38.

"°Ibid, 130, emphasis added.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 0 6 Commission with Hallstein and Spaak at the helm, endorsed this Report. During a September 1962 meeting between the European Parliament and the Council of Europe, Hallstein agreed with Birkelbach "... down to the last detail on the neutrals, adding, almost ominously, 'It is not the first time I have said this.'"111 It is therefore extremely significant that what ultimately resulted by way of EC external relations policy toward the economically well-off Euro-neutrals (and remaining EFTA members after the 1972 EC enlargement) was a bilateral trade agreement status via Article 113. The 1972 FTAs were, in fact, the EC's first application of Article 113 for substantially developed countries. The distinction between Article 238 and Article 113 is therefore legally important, since there are implications of eventual EC membership attached to Article 238 status whereas this is not the case in Article 113 status. Indeed, what the three Euro-neutrals had jointly bargained for during the early 1960s was an Article 238 arrangement, but what they obtained in 1972 was an Article 113 arrangement. But this was not necessarily because it is what the EC dictated to them, but rather what was best for them regarding the political implications of Article 238. However, attached to the 113 FTAs were the "evolutionary clauses," which allowed for

"‘ibid, 130-131, fn86.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 0 7 development of relations with the EC on a bilateral basis beyond the establishment of the FTA in industrial goods. So, comparatively speaking, countries which obtained Article 238 status vs. Article 113 status did so not necessarily by choice, since their economic situations and/or geographical position required this status. The Article 113 countries basically were capable of joining the EC given their developed economies and geographical position, but they chose to remain outside and to avoid any political affiliations with the EC. Thus, the answer to the question of which countries were in a more favorable position is clear. Going the route of 113 was a clear indication that these countries were given the choice of EC membership, but chose instead to "reduce the sentence," so long as an alternative existed to do so. Those that went the 238 route wanted in, but the EC said no. It is curious to consider who dictated terms to whom. After all, [f]or the neutral countries the association procedure ... would mean in practice the surrender cf more of their independence than would full membership, which would give them a consultative voice and right of co determination. 1,2 Ironically, this is the same position in which the Euro- neutrals find themselves today with the resulting May 1992 EEA Treaty which does not allow for genuine co-decision making. This provoked even the most obstinate of the Euro-

ll2Mozer, 84-85, emphasis added.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 0 8 neutrals, Switzerland, to place a full EC membership application so as to ensure input during the formulation of decisions which will ultimately affect it. Writing in 1972, Henig stated: [i]n the context of the present enlargement negotiations, two distinct strands of opinion have developed within the Community towards the three EFTA neutrals. The so-called 'hard' line is to deny association to any country geographically and economically eligible for full membership. Austria and Finland would clearly then have to be considered as special cases, but Sweden and Switzerland would have a choice between full membership and nothing. However, some inside the Community fear that, in such circumstances, the two latter would apply for full membership (which would have to be granted) and would then obstruct any progress towards political unity. The opposed 'soft' line would offer the neutrals only trade agreements, without the institutional links of association.113 In other words, during the 1970s, the "soft" liners were concerned that Sweden and Switzerland would call the EC's bluff if they were only provided with the two options of full membership or nothing. As such, the "soft" liners won- out, (for the time-being) and an alternative was provided via the Article 113 FTAs. Ironically, however, today all of the Euro-neutrals are calling the EC's bluff, since the EEA will only provide a transitional arrangement until full membership can be achieved.

ll3Henig, 144.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 0 9 Austria/s Alleinaana (1963-19671 Joining the EFTA in 1960 was Austria's best option since it could not (for political purposes dictated primarily by the Soviet Union), be a full member of the EC. However, Austria viewed the EFTA from the perspective of how it could keep pace with the EC so as to not be marginalized by it. Thus, to a large degree, Austria viewed EFTA membership as "... nothing but a necessary step toward association with the EEC."114 As such, Austria's policy of Bruckenschlag ("bridge building), developed quickly after the creation of the EFTA in an effort to develop a European- wide economic arrangement which could comfortably accommodate both the EFTA and the EC.115 The 1965 EFTA Vienna Declaration is an attestment to Austria's leading role in seeking a bridge between the EFTA and the EC. The Declaration "... called for steps to bring the two institutions into closer and more continuous contact.... The ministers also .... propos[ed] ... ministerial meetings between the two integration groups, an instrument which became a permanent element of the EC-EFTA relationship in the late 1980s."116 The primary reason that Austria was as active as it was in pursuing an EC-connection was largely

‘“Katzenstein, 173.

‘“Thomas O. Schlesinger, Austrian Neutrality in Postwar Europe. Vienna: Wilhelm Brumueller, 1972, 94.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 110 because its major trading partners were members of the EC. Indeed, even during the "common front" strategy, the EC recognized that Austria was much more economically dependent on the EC than were either Sweden or Switzerland. The EC also recognized that "... although her neutrality was formally a matter of choice... Austria, unlike Sweden and Switzerland, had no effective option save neutrality."1,7 Thus, the EC was somewhat more sympathetic to Austria than it was to either of the other two regarding any association with it. Since Austria was aware that the EC considered it to be "a case apart" from Sweden and Switzerland, Austria was inclined to pursue an independent path toward integrating with the EC in its alleingang. Needless to say, Austria's practice of collective integration via bruckenschlag (EFTA and EC) in conjunction with Austria's practice of independent integration via alleingang (Austria and EC) seems, at first glance, to smack of duplicity and to be clearly contradictory. However, "[t]here was no inconsistency in favouring a strong EFTA while at the same time working for an agreement with the EEC, as the work of EFTA could not be said to be completed until a single comprehensive European Market had come into being."118

ll7Camps, 497.

"8Siegler, 64.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. I l l Therefore, by pursuing two options at once, Austria was attempting to keep as many options open to itself as possible. In this way, the Austrians would at least have a closer relationship with the EC via the EFTA if the association agreement it was pursuing bilaterally with the EC did not work out. Likewise, during the EEA negotiations beginning in 1984, Austria began to pursue a collective integration approach with the EFTA toward the EC, but by 1989, it pursued a solo-action in the form of applying for full EC membership in conjunction with the EEA negotiations. Austria's ultimate goal of not being marginalized by the EC has remained unchanged these past thirty plus years, regardless of the seemingly separate integration paths. Consequently, during the 1960s and during the late 1980s and early 1990s, Austria was simply utilizing the means side of neutrality to the best of its advantage in an effort to secure the end of neutrality: the preservation of national sovereignty and identity. Although the UK-EEC negotiations were vetoed in January 1963, and both Sweden and Switzerland shelved their requests for association status with the EEC, Austria continued with its EC exploratory talks and negotiations, via its "go-it- alone" approach. Austria reaffirmed its intentions to remain on course with an independent EC arrangement in March 1963. During the course of 1963,

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 112 Austria pushed the envelop by pursuing the best of both worlds: it actually proposed double membership in the EFTA (free trade area) and the EC (customs union with exemptions). Given Austria's low economic threshold, its primary concern was over marginalization vis-Si-vis the EC market. As such, Austria hoped to establish a customs union with the EC that might ultimately lead to economic union.1,9 However, Austria also insisted on the retention of its neutrality status, and thus requested that the EC work around this detail. Moreover, the precarious issue of Austrian participation in the EC decision-making process proved to evade any quick decisions.120 Austria's quest for an EC association status continued until mid-1967. In June, Italy vetoed Austria's EC negotiations over terrorist activity in the Austrian Southern Tyrol region in the Alps, now under Italian rule as a province called Alto Adige.121 However, "... there seems to have been some mutual understanding between Austria and the Community that the idea of association was not dead and could be revived once the problem of the Tyrol was settled."122 This issue was resolved in late 1969, and

i,9T. Wieser and E. Kitzmantel "Austria and the European Community." Journal of Common Market Studies 38, no.4 (June 1990), 433.

l20Katzenstein, 173.

121 Ibid, 176.

122Henig, 141.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 1 3 Austria did make an effort to rekindle the negotiations. However, the EC was rapidly changing at this point of time, since the possibility of EC enlargement was a reality, given de Gaulle's departure from power. Thus, Austria suggested an interim preferential trade agreement via Article 113 of the Rome Treaty. Ironically, this suggested provisional arrangement turned out to be the EC's "... mandate for negotiations under Article 113, ",23 and became the basis of affiliation between Austria and the other EFTA members not joining the EC for the next twenty plus years. Given this approach by the EC: ... Austria returned completely into the fold of the EFTA countries who could or would not seek association status, let alone membership. Institutional questions disappeared from the integration debate, and the era of the free trade areas could begin.124 Therefore, despite its solo-action and quest for a special bilateral deal via Article 238, the results of Austria's efforts were no different from what the other EFTA members received via Article 113. Ironically, Austria's relentless pursuit of an association status forced the EC to delineate the requirements for this type of agreement all the more quickly, and not necessarily to Austria's liking. Just as Austria was the first of the Euro-neutrals to seek a closer relationship with the EC during the 1960's and 70's as well

IJ3Ibid, 143.

l24Wieser and Kitzmantel, 433, emphasis added.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 1 4 as the first to apply for full membership status in July 1989, it seems that the EC' preference for package deals — lumping all of the Euro-neutrals, let alone the EFTA members, together — remained and will remain the likely outcome. While Austria provided the "jumpstart" toward closer bilateral EC relations during the 1960s, the only additional benefit Austria received in its FTA with the EC in 1972 was that it started three months earlier than the rest, a considerably small advantage given its "eleven year courtship". However, this mirrors Austria's experience in perseverance during its ten-year journey toward sovereignty from 1945-1955.

The Second Signs of EFTA Defections Ironically, just as Austria was "returning to the EFTA fold" after having been rebuffed by the Italian veto of 1967, Britain and Denmark, now joined by Norway, were ready to try again for EC membership. However, de Gaulle, once again vetoed the United Kingdom, along with Norway. Curiously, despite the fact that de Gaulle offered Denmark membership,125 Denmark was prudent enough to remain with the EFTA, as it realized the possible ramifications of alienating one of its two most important trading partners - the United Kingdom. However, de Gaulle's second veto was

12SPedersen, "EC-EFTA Relations: An Historical Outline," 17.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 1 5 motivation enough for the Danes to initiate a new regional plan for a Nordic customs union. As for the United Kingdom's once close relationship with the Nordics as reflected in the UNISCAN framework, such British-Scandinavian convergence within the EFTA rapidly deteriorated after the British imposed an import surcharge in 1964 against all third countries, including its co members in EFTA. This also partially explains the Nordic reaction in attempting to form its own customs union, reverting to the Nordic tendency of seeking regional solutions amongst themselves when other options look bleak.

NORDEK (1968-1970) Not uncharacteristically, after de Gaulle's consistent rejections of EC applicants and the British import surcharge, the plan for a Nordic Economic Union (NORDEK) emerged, led by Denmark. All Nordics participated in the discussions except Iceland, whose trade at this time surprisingly focused more on the United States and Eastern Europe than on EFTA and the EC.126 The proposal was based on the "... understanding that each country's sacrifices and obligations should be balanced by corresponding advantages

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 1 6 and gains."127 Although a good plan in theory, it was ultimately doomed to failure because of the widely differing goals amongst the Nordics. As Pedersen pointed out: [i]t proved impossible ... to bridge the gap between the Danes, for whom NORDEK was basically a tactical device (meant to strengthen EFTA's bargaining power vis-a-vis the EC), and Finland, for which NORDEK was a very serious matter [because of its special relationship with the Soviet Union].12® Moreover, the EC's 1970 issuance of the Davignon and Werner Reports for deepening integration in political cooperation and monetary issues, respectively, proved to be enough reason for Finland to want to pull out of the NORDEK talks, fearing a possible link between the EC and NORDEK as a provocation for a Soviet reaction. During the time of the NORDEK discussions, Sweden considered a special bilateral arrangement with the EC to be the more favorable option. For example, Sweden submitted an "open application" to the EC in which it hoped the EC would make special concessions to Sweden because of its neutrality. Witnessing the French defection from NATO had given the Swedes the idea that this could be arranged. However, it became clear to Sweden after the Davignon and Werner Plans were confirmed by the EC that such an affiliation was not appropriate. However, this did not stop Sweden from sending the EC a secret letter

,27Stilvant, 116.

,3Pedersen, "EC-EFTA Relations: An Historical Outline," 18.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 1 7 requesting a customs union between it and the EC.129 After the failure of NORDEK and the resignation of de Gaulle, Denmark, Norway, the United Kingdom, and neutral Ireland reapplied for EC membership. This was to be the time of EC approval. However, it is worth pointing out that with the decision to enlarge the Community, came also the initiatives to deepen its integration via the Werner and Davignon Plans.

The Second Swedish EC Debate (1967-1971) While Austria was subjected to refusal within the EC by Italy's veto, by 1967 when the United Kingdom placed its second bid for EC membership, Sweden pursued the same deal it had tried to complete during the "common front" during 1961-1963. Learning from the Austrian approach to the EC, Sweden submitted an "open application" in an effort to get the best possible deal with the EC. As such, during Sweden's second debate on the EC, many Swedes wanted Sweden to join the EC as a full member rather than as merely an associate member. The pro-EC movement figured that Sweden had so much to offer the EC that it could feasibly obtain special concessions from the EC regarding its neutrality. It thus became the "fifth" candidate in the negotiations, along side the UK, Denmark, Ireland and Norway.

,29Ibid.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 1 8 Moreover, by this time, the EC had experienced what the Swedes viewed to be a set-back during the 1965-1966 "empty chair" crisis. The effect of the resulting Luxembourg Compromise on Sweden's domestic debate on EC membership cannot be minimized. France was able to secure an opt-out when "vital national interests" are at stake. Logically, Sweden viewed this precedent as a tool for itself to secure opt-outs regarding its neutrality status. Thus, by 1967, Sweden did not view the EC as quite the supranational political organization it professed itself to be. Rather, the EC appeared to be developing more along the lines of an inter-governmental arrangement. Therefore, Sweden presented an "open application" to the EC in 1967 which meant Sweden would decide what form of agreement to seek on the basis of prior talks with the EC. "The motive advanced was that the Luxembourg compromise and the halting evolution of EC cooperation in general had created a new situation. It was argued that Sweden's stance as a neutral nation would not necessarily be compromised in case of membership."130 Indeed, then-Prime Minister Olof Palme, toured Europe during this time to vocalize Swedish interests and terms for EC membership. Moreover, Swedish Commerce Minister Feldt

130Sverker Astrom, "The Nordic Angle I: Sweden's EC Dilemmas." The World Today 44, no.11 (Nov. 1988), 192.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 1 9 stipulated Sweden's interests in the EC as including a "... customs union, common commercial and agricultural policies, and measures to achieve EEC goals of 'increased movement of labour, services, and capital as well as co-operation in the fields of social and economic policy.'131 On March 18, 1971, the Swedish Government issued a memorandum which clarified its position on the extent of Sweden's relation to the EC: ...international ties cannot be accepted which make the possibility to choose neutrality in time of war illusory. The policy must be supported by a strong military defence and the economic life so organised that the nation can endure a large-scale blockade during a fairly long period.... [W]e cannot join within a certain group of states in co-operation on matters of foreign policy which is binding and which aims at the working out of common policies. Limits are also set on our ability to accept a transfer of the right of decision-making to international institutions within the framework of an economic and monetary union.132 Needless to say, this was quite a caveat in Sweden's request for EC membership. However, on the eve of enlargement, the EC had to prove its intentions on deepening integration in conjunction with its widening membership. This took the form of the Hague meeting in 1969, which developed the Davignon committee to explore political cooperation and the Werner Committee to explore economic and monetary

l3lIbid, 429-431.

I32James L. Waite, "The Swedish Paradox: EEC and Neutrality." Journal of Common Market Studies 12, no.l (1973-1974), 331.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 120 objectives. As had been the case during the early 1960s when the EC's Bonn Declaration set up the Fouchet Committee to look into political cooperation, with the issuance of the Davignon and Werner Reports, the Swedish Government decided that such EC aspirations were loaded with political implications and therefore infringed upon maintaining a credible neutrality policy. Thus, as after the first debate, Sweden chose instead to pursue the FTA option, largely because it could economically afford to do so.

The EFTA-EC Free Trade Agreements The four applicants for EC membership (the United Kingdom, Denmark, Ireland and Norway), concluded negotiations and signed a Treaty of Accession with the EC in Paris on January 22, 1972. During the national referenda in Ireland, Denmark and Norway and the phase of approval in the United Kingdom's Parliament, only Norway had to forego membership in the EC and remain in EFTA after a September 24-25, 1972 negative vote.133 Moreover, after de Gaulle's resignation and the initiation of negotiations for further EC enlargement with the "willing" EFTA members, the EC

l33See: Nicholson and East's From the Six to the Twelve for a detailed discussion of the three EC enlargements.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 121 countries: ... were sympathetic to the establishment of a special trade arrangement between themselves and [the remaining] EFTA [members] given the dependence of the EFTA countries on the EEC market, the opportunity that enlargement gave to end the division of [Western] Europe into two trade blocks, and indeed the importance to the EEC countries to their export markets in EFTA.134 So as to ensure that the remaining EFTA nations would not be discriminated against by the enlarged EC which had gained their core country, the United Kingdom, preferential bilateral free trade agreements were established, ushering in the third phase of EFTA-EC relations - "pragmatic bilateralism". In order to avoid raising tariffs between EFTA countries and the EC, this arrangement proved to be the most useful. Thus, apart from a few sensitive products such as paper, the new arrangements created free trade in industrial products between sixteen countries in Europe. Moreover, Britain insisted that the remaining EFTA members could not be marginalized by the enlarged EC. Thus, the FTAs were developed. The EC had its reasons for preferring to keep the negotiations and agreements at a bilateral rather than multilateral level. R.C. Hine of the University of

l34Hine, 120.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 122 Nottingham points out some of those reasons: [t]he bilateral approach may have been speedier, making it easier to meet the January 1973 deadline set for EEC enlargement. In addition, a series of bilateral agreements was seen by the Community as the best way to prevent any dilution of its separate identity and to minimise the constraints on its freedom of action.135

It is important to understand that during the EC bilateral negotiations with the remaining EFTA members, the EFTA neutrals, except Finland, wanted even more comprehensive agreements than the resulting FTAs. As discussed earlier, both Austria and Sweden had been negotiating for possible customs union arrangements with the EC. However, the EC declined any such approach since it would have simultaneously required many EC concessions to the neutrals in opting-out.

135Ibid, 122.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 2 3 The FTA was the maximum acceptable solution only for Finland, whose policy was conditioned by its relations with the Soviet Union rather than by any normative ideas of neutrality. For the three others a free- trade agreement was an undesired alternative imposed unilaterally by the EC and quite far from what they would have been prepared to define as compatible with their neutral positions and policies.136 Although the language above is rather dramatic regarding the resulting FTAs as "an undesired alternative imposed unilaterally by the EC," therein lies the importance of the so-called evolutionary clauses, which all Euro-neutrals adopted except for Finland. The evolutionary clauses ensured the flexibility for expanding areas of coverage in the bilateral agreements between the EFTA members and the EC. For example, both Austria and Sweden formed FTAs with the EC and ECSC with evolutionary clauses in each. Switzerland also formed FTAs with the EC and ECSC, but stipulated that no evolutionary clause would apply to ECSC. Finland, as an associate EFTA member, and only after establishing trade arrangements with the CMEA countries, formed FTAs in the EEC and ECSC without any evolutionary clauses, so as to appease the USSR. Thus, provisions were made in the FTAs which acknowledged the Euro-neutral's special position. Basically, the FTAs were the political price the Euro-neutrals had to pay by choosing to not become full EC members: "... [t]hese accords [FTAs] preserved the

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 2 4 neutrals' legal and political freedom of maneuver."137 However, Ireland chose to become a full EC member as well as to preserve its neutrality from within the EC. Overall, the resulting bilateral FTAs between the EC and remaining EFTA members were similar, but tailored to each of the EFTA member's needs.138 The same criteria included: [p]roviding for the gradual elimination of tariffs for industrial products and a number of processed agricultural goods, the agreements stipulated a general transitional period of four and a half years. For the so-called sensitive products, the transitional period was extended to 1980 and for paper products, until 1984. The timetable for removal of tariffs was basically the same for the then acceding EFTA countries.139 Finally, provisions other than tariffs were addressed within the bilateral FTAs, such as competition policy and export restriction, and as such, these agreements foreshadowed the 1984 Luxembourg Declaration between the EFTA and the EC.140 Victoria Curzon of the University of Geneva points out the basic functionality of implementing the preferential

137Keatinge, Patrik. "Neutrality and Regional Integration: Ireland's Experience in the European Community." In Between the Blocs. 61-80: 64- 65.

I38The bilateral FTAs with Austria, Portugal, Sweden and Switzerland entered into force on 1 January 1973, coinciding with the British, Danish and Irish memberships in the EC. The remaining three bilateral FTAs entered into force by 1 March 1973 (Iceland), 1 July 1973 (Norway) and 1 January 1974 (Finland). See: Finn Laursen's "The Community's Policy towards EFTA," in Journal of Common Market Studies 38, no.4 (June 1990), 311.

139Pedersen, "EC-EFTA Relations: An Historical Outline," 18-19.

,40Wieser and Kitzmantel, 435.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 2 5 bilateral FTAs: ... the free trade area formula was the only one which could accomplish the triple feat of integrating the whole of Western Europe, without sacrificing the unique and exclusive nature of the CET and without compromising the neutrality of the neutrals.141 As such, a full-fledged customs union between the groups which would require a CET was not even a consideration, and in fact would have been superfluous to the EFTA members who preferred to stay out of the EC. Of particular significance to the remaining EFTA countries was the fact that they were not only able to maintain FTAs with their former EFTA partners, Britain and Denmark, but they were also given access to EC markets and Ireland, and were therefore given the option to remain outside yet not be economically isolated from the European core.142 In fact, with the FTAs the EFTA members arguably had the best of both worlds and were in the most enviable position in so far as they were able to partake of selected economic aspects of the EC yet they were still able to have the luxury of remaining outside and avoiding the inherent supranationalism of the EC. Indeed, for the same reasons that V. Curzon pointed out for the FTAs of 1972, the same reasons hold true for the functionality of an SEA twenty

l4lVictoria Curzon, The Essentials of Economic Integration; Lessons of the EFTA Experience. New York: St. Martin's Press, 1974, 230.

lcHine, 120.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 2 6 years later. The EEA provides EFTA members with an alternative to EC/EU membership without the prospects for isolation or marginalization.

The Austrian Experience The FTA was signed on July 22, 1972, and because of its 11-year courtship of the Community, Austria was given the consolation prize of a three month headstart in tariff reductions.143 Although the Soviets had been particularly vociferous in 1961 about Austria's not being affiliated to the EC in any way, its criticism was still apparent, but significantly milder by 1973. For example, in a memorandum sent to the Austrian Government on August 18, 1972, the Soviets stated that "the Agreement between Austria and the Communities must not change the rights and obligations of the parties to the Austrian State Treaty and the obligations undertaken by Austria in constitutional law on permanent neutrality."144 In addition, it was apparent that one of the Soviets' primary concerns over the FTA was its effect on Austria's trade with the Soviet Union and the other CMEA nations. The Austrian Government responded to the Soviet memorandum by stating that its neutrality would not be

143Dunn, 14. For complete text of the Austria-EC FTA see: The Official Journal of the European Community (December 31, 1972), 1-97.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 2 7 jeopardized by the FTA and that it had no intentions of disrupting its trade patterns with either the Soviet Union or the CMEA nations.145 Reflecting on the Austrian experience from 1958 to the establishment of the FTA, one is struck by the paradox of Austria's efforts in seeking a closer arrangement with the EC. Prior to the creation of the EFTA, Austria sought, through the OEEC's Maudling Committee, a European-wide FTA, and this fell through so EFTA was established. When the UK applied for EC membership in 1961, Austria linked itself to the other two Euro-neutrals within the EFTA for an association agreement with the EC. However, after de Gaulle's veto of UK membership, both Sweden and Switzerland disassociated themselves from the EC until the EC decided to enlarge its membership. On the other hand, Austria continued to negotiate with the EC via Article 238 and even pursued a customs union between itself and the EC while retaining its neutrality. This caused the negotiations to be rather difficult, because any concessions made by the EC to Austria would appear to infringe on the integrity of the EC's supranationality. Finally, in 1971, after de Gaulle had resigned and the Werner and Davignon Reports were issued, the EC made overtures toward resolving the EFTA problem with FTAs. This was essentially a return to the

l45Christian Science Monitor. September 20, 1972, 7.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 2 8 1958 position, despite the arduous journey Austria experienced. As Switzerland and Sweden had surmised in 1963 when they pulled out of the pursuit for EC association, agreement with them was not reached until after the EC decided to enlarge its membership. Consequently, Austria did not gain anything more than what Sweden and Switzerland gained in the form of an FTA, except a three-month headstart via its interim agreement. Typical of Austria's tenacity is that once the FTA was achieved, Austria shifted its regional, "Euro-centric" focus to a more international focus. This was understandable since Austria felt like it had accomplished all that it could for the time-being with the EC and the EFTA. Constantly pursuing all of its options, Austria simply shifted gears when it recognized that its EFTA and EC options were currently maximized. Indeed, "[t]he seventies were probably the period ... where the primacy of politics over economics was most complete."146 During the 1970s, Austria became a significant participant in such forums as the UN and the CSCE.

146Wieser and Kitzmantel, 435.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 2 9 The Swedish Experience The Swedish experience from 1958 to the 1972 FTA was similar, although not identical, to the Austrian experience. Both were motivated by the desire not to be marginalized by the EC economically. Both wanted to ensure that any affiliation with the EC would not jeopardize their respective policies of neutrality, and thus, the political dimension of the EC was to be avoided. When the British applied for EC membership in 1961, the Swedes limited themselves to a possible association with the EC via Article 238 since it wanted to avoid the implications of the EC's supranationalism. However, with de Gaulle's veto, Sweden pulled out of the common front while Austria pursued its alleingang. By 1967 when the United Kingdom re-applied for EC membership, the EC had experienced the trauma of the "empty chair crisis" which made EC membership appear more compatible with Sweden's neutrality. As such, Sweden negotiated from an "open application" for the best possible arrangement. Once again, however, the de Gaulle veto and the issuance of the Davignon and Werner Reports after de Gaulle was out of power, were reason enough for Sweden to retreat from the supranational implications of membership. The Swedes, like the Austrians, were attempting to get the best arrangement with the EC that they possibly could. The reasons for their fluctuations in position were

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 3 0 primarily because of the EC's bumpy existence. Thus, "... the changing Swedish attitudes can be seen as response to developments inside the EC."147 As such, for Sweden, the obvious answer became the FTA through Article 113 of the Rome Treaty. Although it had negotiated for a customs union arrangement, such an arrangement required too many opt-outs as far as the EC was concerned. As such, the Swedish Government justified the resulting FTA as being a way to reconcile neutrality with integration at this point in history. Arguably, however, the resulting FTA with the EC was not much different than membership with the EC would have been, especially given the evolutionary clause. As Waite points out: "[i]t is ludicrous to speak of separating economic policy from foreign policy in any nation, let alone in a nation whose economic lifeblood is directly linked to its foreign trade."148 Therefore, Waite concludes "[t]he problem ... has been to make the Swedish entanglement with the EEC appear congruent with traditional Swedish neutrality."149 Since perception is such a large part of practicing a credible neutrality policy, the best way to make the two compatible was by going the route of Article 113 with an evolutionary clause.

l<7Astrom "The Nordic Angle I: Sweden's EC Dilemmas," 192, emphasis added.

I4*Waite, 332.

I49Ibid, emphasis added.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 3 1 However, Mats Bergquist, First Secretary at the Ministry for Foreign Affairs insists that since Sweden already participates in many international organizations without compromising its neutrality, it can also participate in the EC. He states: [p]olitical neutrality has ... not prevent[ed] Sweden from joining in any cooperative projects which are thought to be of interest to an advanced modern industrial nation and which are reconcilable with its neutrality. [After all,] [p]articipation in such joint projects is ultimately a precondition of technical and economic progress, as Sweden has long since realized.150 Thus, in 1972 Sweden chose to resolve the quandary in its relationship with the EC by separating the economic dimension of integration from the political dimension of integration. In so doing however, Sweden was aware that such an arrangement would only last for so long. However, for the time being it accomplished the goal of not being economically marginalized by the EC and not being affiliated to the EC in the political realm. As such, Sweden's FTA with the EC ”... was dramatic yet not startling - as formal membership with the Common Market would have been.”151 In 1988 a former Swedish ambassador to the UN stated that ”[t]his agreement has served us well and seems to have

'“ibid, 333-334, emphasis added.

15lIbid, 335-336.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 3 2 functioned to the full satisfaction also of the EC members."152 In order to move beyond the FTA, the Swedes, along with the other EFTA members, negotiated the EEA Treaty. Since "... Sweden's neutrality is flexible ... [and] changes to meet new demands,"153 it will not present an obstacle in further development of Sweden's relationship with the EC, either through the EEA or even as a full member.

Ireland's Path to EC Membership Although easily dismissed as being an inappropriate model of neutrality for the other Euro-neutrals,154 Ireland's experience with European integration has necessarily had to be different from the others since its economy can be considered as under-developed. Indeed, Ireland's extremely pragmatic approach to integration, given its economic and political situation, is reflective of the means side of the neutrality equation: preserving national identity through participation in integration minus any military allegiances. In this respect, Ireland provides an extremely useful case-study for the other Euro-neutrals not

,52&strom "The Nordic Angle I: Sweden's EC Dilemmas," 192.

153Waite, 335-336.

154For example, see the writings of Trevor Salmon, to include Unneutral Ireland; An Ambivalent and Dnioue Security Policy. Oxford, England: Clarendon Press, 1989.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 3 3 only because it is the only current EC member which claims to practice neutrality, but also because of the economic imperative which provoked Ireland to join as a full member, similar to the economic imperative being analyzed by the Euro-neutrals today. Thus, despite Ireland's "ad hoc" brand of neutrality, its application of neutrality as a tool to secure its national interests is highly illustrative to the others on neutrality's utility from within the EC. Ireland chose not to be a member of the EC when it was created in 1958 or a member of the EFTA when it was created in 1960. The EC did not appeal to Ireland because all six EC members were in NATO, and Ireland was attempting to practice its self-proclaimed policy of neutrality in a credible fashion.155 It chose not to become a member of the EFTA because the EFTA did not include agricultural goods, which were of paramount importance to Ireland's economy. Ireland therefore "held out" until it heard that the United Kingdom, its largest trading partner, would be applying for EC membership in 1961. In fact, Ireland placed its membership bid before the United Kingdom. Indeed, from

,S5Of particular interest is that although the U.S. asked Ireland to be a member of NATO, and although the Irish government was interested in doing so, Ireland took the "maximalist" approach to press the issue of Irish reunification as a price for its membership in NATO. Since neither the U.S. nor the United Kingdom would allow that, Ireland did not become a member of NATO, and was relegated to the self-chosen fate of neutrality. Indeed, it can be argued that Ireland chose neutrality by default, and has been trying, for the last fifty years, to make the best of the situation of being neutral. This has had the unfortunate effect of placing Ireland in a half-way house, and not being taken very seriously as a neutral nation.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 3 4 1957-1972, the United Kingdom and Ireland had a bilateral FTA which made it all the more logical for Ireland to join the arrangement that the United Kingdom joined, but agriculture must be included. However, with de Gaulle's vetoes in both 1963 and 1968, Ireland waited until the path was clear for its application. This occurred in 1972 when Ireland, along with Denmark and the United Kingdom, joined the EC. Since Ireland's neutrality is extremely asymmetrical toward the United Kingdom, Ireland viewed membership in the EC as a tool for it to gain recognition apart from the United Kingdom. In this way, it could subsume its economic dependence within the greater whole of the EC and not simply on the United Kingdom. Therefore, although Ireland was heavily reliant on the United Kingdom economically, it was fiercely independent of the United Kingdom politically, and it therefore made perfect economic sense to join the EC as well as political sense to be given recognition that it would otherwise not have. Therefore, Ireland was simply dealing with the deck of cards it had been given as the best way to maximize its national interests and to preserve its sovereignty.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 3 5 Concluding Assessments It is therefore clear that from 1958-1972, the EFTA was created initially as a retaliation to the EC, exposing a "separation", while a full fledged "divorce" never occurred between the two, since relations were not completely severed. Moreover, during this timeframe the EFTA evolved from a temporary "waiting room" for a wider free trade zone to a more permanent institution being used as a "bridge- builder" to the EC as revealed in the 1965 Vienna Declaration. However, the ultimate aim of all EFTA members, even the imminent "defectors," still embraced the prospects of the wider free trade area envisioned during the Maudling Committee negotiations. As the 1972 bilateral FTAs developed, so too did the mutual confidence and trust between the EFTA and the EC. This was reflected by: - an acceleration of the timetable for dismantling the tariff barriers; - a modest, but nevertheless significant extension of the product coverage for trade cooperation in a limited way for agricultural products (wine, cheese, lamb, fish); [and,] - a growing interest to consult each other in other areas of mutual interest such as environment, consumer policy, economic aspects, transit etc.156 As the FTAs became more consolidated, the EFTA members began to look for additional areas of common interest and began to

IS6H. De Lange, "Taking Stock of the EC-EFTA Dialogue." In EEC—EFTA; More than Just Good Friends?, ed. Helen Wallace and Jimmy Jamar. College of Europe, Bruges Symposium, June-July 1988. Tempelhof: De Tempel, 1988, 311.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 3 6 consider initiating a "second generation" of dialogue in their relations with the EC.157 The aim of EFTA (and the international trade organization known as the General Agreement on Tariffs and Trade - GATT), was to avoid the possibilities of new trade restrictions in areas not covered by the FTAs.158 This became increasingly important as the international trade environment was profoundly affected by the 1973 OPEC crisis. In this respect, for both EFTA and the EC, the FTAs could not have come at a better time. Consequently, during the period from 1972-1986, each group became the other's major trading partner and together the two groups created the largest trading area in the world, with their trade increasing five-fold.159 The EFTA and EC also grew to realize the importance of having reliable trading partners in an unpredictable trade environment. With this realization, the path became clear for initiating the "second generation" in the EFTA-EC dialogue on a multilateral level and widening the framework of European cooperation beyond trade-related issues. Thus, prior to the July 1977 achievement of an FTA in industrial products between the 16 EFTA and EC countries, an

1S7Clive Church, "The Politics of Change: EFTA and the Nordic Countries' Response to the EC in the Early 1990s." Journal of Common Market Studies 38, no.4 (June 1990), 403.

ls*Antola, 237.

,39De Lange, 311-312.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 3 7 EFTA summit was held in Vienna on May 13, 1977 to discuss aspirations of going beyond this accomplishment. Prior to the July summit, and partly an impetus for it, another member of EFTA decided to apply for EC membership - Portugal. This further explains the goals as they were stated during the Vienna meeting.160 The general consensus amongst the EFTA governments was to intensify cooperation not only within EFTA but also between the two organizations. The Declaration stated: ... it was 'important to ensure that the advantages deriving from free trade are not jeopardized as a result of diverging economic developments and policies'. It was therefore desirable to develop the existing co-operation with the EC 'by means of an increased exchange of information and closer consultations on economic questions'... 161 Thus, despite the Portuguese intent for defection, the internal cohesion of EFTA remained committed to the goal of wider West European economic cooperation. This is further revealed in the FTA that EFTA multilaterally established in 1979 with Spain, seven years before Spain became a full member in the EC.162

1<0Pedersen, "EC-EFTA Relations: An Historical Outline," 19.

161Laursen, 311.

lcSven Norberg, "Comment." In EEC-EFTA: More Than Just Good Friends? . 331.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. CHAPTER m

EUROPEAN NEUTRALITY AND EUROPEAN POLITICAL COOPERATION/ COMMON FOREIGN AND SECURITY POLICY

Grand and rhetorical objectives are the stuff of summit conferences ... intended to lift the imagination and to provide a sense of movement and direction, without necessarily committing their authors to reach their ultimate destination. William Wallace, 1982 Plus ga Change, Plus C'Est la Meme Chose European Neutrality in the National Context In the study of international relations it is often convenient to group countries for the purpose of reaching broad assessments which can apply to all. However, this can only be done at a price. As such, the Euro-neutrals can only be collectivized to a limited extent before the nuances between the various brands of neutrality become apparent and overtake the broad generalizations given to the term. It is therefore integral to understand not only the similarities between the types of neutrality, but also the distinctions between each of the brands as practiced by the Euro- neutrals. Moreover, neutrality represents a key element of national identity and is therefore likely to have as many connotations as there are citizens within each of the

138

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 3 9 neutral nations. After all, "[n]eutrality has different faces and can conceal as much as it reveals."1 Thus, any effort to pin down the peculiarities within each brand in an effort to embody a singular national definition should not overlook the sub-national, as well as individual interpretations of the term. Nevertheless, despite the national and sub-national distinctions, all brands of European neutrality generally focus on two fundamental issues - foreign policy and national defense. The divisions primarily occur at the level of focus on either one issue or the other, or in a preference for a balance of interpretation between the two. Hanspeter Neuhold explains: Austria bases its security on national defence combined with an active, pre-emptive foreign policy aimed at either preventing the outbreak of international conflicts or solving them peacefully.... Switzerland ... emphasizes military preparedness. Sweden combines massive investments in national defence with a high-profile foreign policy. Finland relies more heavily on its active peace policy.2 Thus, while each brand of neutrality is unique by virtue of the fact that each nation adopted neutrality under its own terms, there are fundamental convergence points. In the cases of Austria and Sweden, each attempts to balance foreign policy and national defense concerns, thereby maximizing their respective neutrality policies, whereas

‘Max Jakobson, "The Different Faces of Neutrality," in EEC-EFTA: More Than Just Good Friends?. 255.

2Hanspeter Neuhold, "An Austrian View." In European Detente: A Reappraisal. ed. Richard Davy, 205-235. London: SAGE Pub., 1992, 211, emphasis added.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 4 0 Finland and Switzerland have utilized a more focused approach toward either one issue or the other. Finally, as discussed in the last chapter, to merely claim neutrality is not enough for a nation; any such claim by a nation must be supported by the actual military capability to defend itself from any potential aggressor.3 However, both Austria and Finland had limitations placed on their respective military capabilities as a consequence of adopting neutrality (through neutralization). On the other hand, neither Sweden nor Switzerland had any such limits placed on them and each was free to develop extensive indigenous defense industries.4 Indeed, maintaining a substantial independent defense capability reinforces a

3It is important to note that neutral nations focus on defensive rather than offensive weapons, revealing that while they do not want to present a threat to any other nation, they want to ensure that they are able to defend themselves. See: Dietrich Fischer's "Invulnerability without Threat: The Swiss Concept of General Defense,"in Journal of Peace Research 19, no.3 (1982): 205-225. In addition, national focus on maintaining a defensive capability is becoming more important in the post-Cold War environment, and thus, the Euro-neutrals provide excellent role models, since they have maintained such policies for decades.

4In the process of developing indigenous defense industries, the Euro- neutrals (Austria and Finland included, although to a lesser degree) came to rely extensively on exporting a substantial amount of their weapons. The implications of such action on a neutrality policy are obvious. However, the Euro-neutrals view foreign military sales as a business transaction, not necessarily as a promotion for violence abroad. This practice has led to additional predicaments which could infringe on the Euro-neutrals' respective neutrality policies. For example, with the rapid pace of technological development, it is becoming more and more expensive to produce military technologies on a country-by-country basis. Thus, collaboration in research and development is something any nation which produces weapons and wants to remain competitive must consider, and the Euro-neutrals are not immune from this reality. For an extensive discussion of this predicament see: Bjorn Hagelin's Neutrality and Foreign Military Sales: Military Production and Sales Restrictions in Austria. Finland. Sweden and Switzerland. Boulder, CO: Westview Press, 1990.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 4 1 neutral's "cost of occupation" significantly.5 This is discussed in greater detail below.

European Neutrality in the National Context: Austria Austria's Adoption of Neutrality After WWII, Austria's long inarch to independence demonstrated an extraordinary level of perseverance by the Austrian government and people. From 1943 until late 1955, Austria remained occupied by French, American, British and Soviet troops. Although in 1943 the four powers had declared that Austria must regain its sovereignty,6 during the immediate post-WWII division of Europe, their actions consistently indicated that more pressing issues took priority over resolving Austrian independence; namely the German question. Until Germany's fate could be resolved, Austria remained an afterthought. In fact, Austria became a hostage to the situation - a bargaining chip for the Soviet Union in its attempts to keep Germany either under its control, or no other nation's control. Therefore, the linkage between the German question and Austrian independence is uncanny. Once the division of Germany was further consolidated in 1955, the German question, for the

^ y raising the "cost of occupation," a neutral enhances the policy of "dissuasion;" pointing out to a potential aggressor that the costs of invasion would be far greater than any possible benefits from doing so.

*"The Moscow Declaration." In A Decade of Foreign Policy; Basic Documents 1941-1949. U.S. Department of State, Washington, D.C.: U.S. Government Printing Office, 1950, 11.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 4 2 time being, subsided, and Austria's linkage to the German question was broken. By late 1955, Austria became independent, although at the price of neutralization. Neutrality or Neutralization? Austrians generally prefer to be credited with having "chosen" to be neutral and "[p]eople in Austria are very touchy if one suggests that neutrality did not stem from their own decision, but was imposed upon them by a foreign power."7 In addition, some reference the 1953 visit of Austrian Chancellor Julius Raab to India's Prime Minister Jawaharlal Nehru as "proof" of the point when it was decided Austria would adopt neutrality. However, this is a rather dubious assessment since the policy India practiced was non- alignment, not neutrality, and as understood from the last chapter, the two are not the same. In fact, the only genuine choice Austria was faced with in 1955 was either to adopt neutrality or to remain occupied. Given the alternative of continued occupation, it is no wonder Austria "chose" to be neutral instead. Thus, "[w]hilst Austria makes much play with the voluntary nature of her neutrality, the reality is ... that neutrality was part of a package under which the occupation of Austria was ended and as such was far from 'voluntary'!"* Simply put, Austria's adoption

7Mozer, 90.

*John Fitzmauri.ee, Austrian Politics and Society Today; In Defence of Austria. New York: St. Martin's Pub., 1991, 58-59, emphasis added.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 4 3 of neutrality was the political price it had to pay for regaining full sovereignty. The sequence of formal documentation during 1955 further reveals that Austria was neutralized, since it clearly pin-points how Austria adopted neutrality and under what terms. The three 1955 documents were: 1) the Moscow Memorandum (April 15); 2) the State Treaty (May 15); and 3) the Declaration of Neutrality (October 26). While many reference the last of the three documents as proof that Austria "chose" to be neutral,9 the Declaration of Neutrality cannot be interpreted in a vacuum. The realpolitik of what preceded it in the form of the Moscow Memorandum and the resulting State Treaty cannot be disregarded. The first of the three documents, the bilateral Moscow Memorandum of Agreement between the Soviet Union and Austria, included the phrase that Austria would practice "neutrality based on the Swiss model" as a condition for Soviet troop withdrawal. The Memorandum also contained what amounted to Austrian war reparations to the Soviet Union since Austria had to pay the Soviet Union in cash (i.e., $150 million for claims to German assets); and in oil (10 years of exports). Moreover, the Soviet Union forbade the so-called unholy union of Austria with Germany through an

’Fritz Bock, "Austrian Neutrality." In The Austrian Solution. 154- 160: 157.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 4 4 Anschluss.10 Indeed, this last condition by itself qualifies as a "neutralization.1,11 Because of the details established between Austria and the Soviet Union in the bilateral Moscow Memorandum, the four-power multilateral State Treaty was more easily established. Moreover, the State Treaty included stringent conditions regarding Austria's remaining military capability, largely at the Soviet Union's insistence.12 However, all other occupying powers (the United States, France, and Britain), agreed to the terms as laid out in the State Treaty. The only caveat which the U.S. Secretary of State John Foster Dulles insisted on was that the word "neutrality" only appear in the unilateral declaration, and not be specifically mentioned in the State Treaty.13 In this way, Austria would at least appear to be "choosing neutrality" and would do so in unilateral legal terms. However, this, once again, blatantly ignores what had been established in the bilateral Moscow Memorandum, and thus,

10The Soviets had a long memory regarding the 1919 creation of the Austrian First Republic out of the remains of the Hapsburg Empire. By 1938, the First Republic was in economically dire straits and was absorbed by Germany. As a result, after WWII, the Soviets wanted to ensure that this reunion with Germany would not occur again in the Austrian Second Republic. Neutralization provided that route.

"Maila, 34.

I2William B. Bader, "Austria, the U.S., and the Path to Neutrality." In The Austrian Solution. 85-98: 90.

l3John Foster Dulles viewed the division of Europe in black and white terms. As he stated: ”[t]here is no middle ground between freedom and slavery." Thus, he saw neutrality as a very grey and immoral practice. "Report on Berlin," Department of state Bulletin. March 8, 1954, 10.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 4 5 the exclusion of the word "neutrality" from the State Treaty was nothing more than a semantic exercise. Once all troops were withdrawn in October, the Austrian Parliament passed the unilateral Declaration of Neutrality - its first sovereign act. As stated in the Declaration: Article I. (1) For the purpose of the maintenance of her external independence and for the purpose of the inviolability of her territory, Austria of her own free will declares herewith her permanent neutrality, which she is resolved to maintain and defend with all the means at her disposal. (2) In order to secure these purposes, Austria in the future will never accede to any military alliances nor permit the establishment of military bases of foreign states on her territory.14 After this declaration, Austria's neutrality was officially recognized by over eighty states, but guaranteed by none, indicating a certain amount of latitude and responsibility on Austria's behalf.15 Thus, while it is true that neutrality is not directly referred to in the State Treaty, and as such, the Soviet Union could only remind Austria of its responsibility to maintain "permanent neutrality," this kind of implicit leverage on Austria by the Soviet Union resulted in a de facto neutralization, if not de jure. After all, it was this kind of leverage that the Soviets wished to have on Germany when they had tried to use the Austrian solution as a model for Germany to follow.

14Quoted from Siegler's Austria - Problems and Achievements: 1945- 1963. 161.

’^Technically, in a "neutralization,” the great powers guarantee the neutrality of the state.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 4 6 Soviet Plan for Austria's Neutralization Prior to the May 1955 State Treaty, the Soviets had hoped they could use the Austrian example to lure Germany into neutralization as well. For example, only three days after the Moscow Memorandum, Radio Moscow stated: "'[i]f Bonn would follow the Austrian example, Germany as a nation and world peace would gain considerably.'" In addition, on May 19, 1955, Taalich Rundschau, the Soviet daily for East Germany, affirmed that " 'Austria's course can also be Germany's course'". Furthermore, Soviet Foreign Minister Molotov's references to the German problem when the State Treaty was signed were generally interpreted as an appeal to West Germany to follow Austria's example.16 In addition, Molotov hoped that other states beyond Austria and Germany would consider neutrality, such as Yugoslavia and Finland. Yet Molotov was not akin to reciprocating the favor of neutralization to the Central European Soviet satellites, and referred to such considerations as "... 'absolute nonsense.'"17 However, once West Germany joined NATO and it was clear that Austria's neutralization would not be emulated by Germany, the Soviet Union focused on developing its own military alliance, the Warsaw Pact. Ironically, Austria's neutralization was more favorable for the East

l6William L. Stearman, "An Analysis of Soviet Objectives in Austria." In The Austrian Solution. 99-124: 107.

17Ibid, 108-109.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 4 7 than for the West since, strategically, a neutral Austria posed more problems for NATO than for the Warsaw Pact. Joined with Switzerland, Austria created a buffer between NATO's central and southern forces, and a gap in the lines of communication and supply between Germany and Italy. Moreover, by 1955, Austria had become an economic liability, since the Soviet Union had its own resources in oil and since many Austrian industries were on the verge of bankruptcy.18 In fact, the Soviets could have remained in Austria, but it would have cost them too much. Clearly, Austria had been a pawn in a much wider Soviet plan for Germany, and when that plan did not work out, the Soviet Union pursued its national interest by encouraging the neutralization of Austria. Indeed, Austria's neutralization represented the first real break in Cold War hostilities and helped lead to the first stages of detente in post-WWII Europe.19 Yet one year later, the Soviet invasion of Hungary quickly changed this easing of tensions. The Relevance of "the Swiss Model11 In the Moscow Memorandum, the Soviets referenced Switzerland's brand of permanent neutrality as the "model" for Austria to emulate. Thus, early on, the term "neutrality" was collectivized from the viewpoint of at least one of the great powers. Perhaps the extent of

'*Bader, 95-96.

19Neumann, 143.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 4 8 Switzerland's relevance to Austrian neutrality lies mostly in its geographic proximity to Austria in the Alpine region. In kind, the Soviets did not refer to either of the Nordic neutrals, Sweden or Finland, as the "model” for Austria to follow. What is interesting, however, is that perhaps reasons other than strictly geographical considerations were part of the Soviets' plan for Austria. After all, Switzerland, out of all the Euro-neutrals, practiced and still practices the most stringent and dogmatic brand of neutrality, as indicated by its refusal to join the United Nations. Thus, although the significance of the Swiss model seems minor at first glance, the Soviets may have been intentional in their selection of Switzerland as the model for Austria to follow rather than the more "active," and somewhat unpredictable neutral Sweden. In fact, since the signature of the State Treaty and despite the Declaration of Neutrality, Austrian foreign policy has had little room for maneuver. As such, Austria's brand of "__ 'permanent neutrality' has never had the positive connotations of Swiss neutrality, even though, as we have seen, Swiss neutrality was cited as a model by both Austrian and Soviet negotiators."20 However, Switzerland considers itself to be the inventor of neutrality and generally views Austria's "flexible" approach to neutrality as deviant from its own,

2CFitzmaurice, 58-59, emphasis added.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 4 9 and therefore considers any analogies between the two as dubious. Austria's "Active" Neutrality Since becoming a sovereign state in October 1955, Austria has had to "learn to be neutral." This process led to a particularly difficult period of adjustment, given Austria's prior two hundred year history. However, from the start, Austria looked for ways to make its neutrality more flexible than the traditional "passive" Swiss brand and more similar to the innovative "active" Swedish brand. According to Swedish member of Parliament Sigmund Widmer, "[n]eutrality ... must not mean abstention from general political activity."21 While Switzerland, more than any of the other Euro- neutrals prefers to approach neutrality as an end in itself, both Austria and Sweden immediately promoted the means interpretation of neutrality during the Cold War: "[it] is not an end in itself, but is intended to serve superior objectives, above all the security and independence of the country that opts for it."22 Despite being neutralized, Austria has practiced its neutrality policy very actively by participating in such forums as the UN, the Council of Europe, and the CSCE. Yet, during the Cold War, Austria was

2,Sigmund Widmer, "Forms of Neutrality." In Between the Blocs. 17- 28: 27.

2Neuhold, "An Austrian View," 232.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 5 0 also painfully "... aware ... that its status within the framework of international law [was] a function of the balance of power in Europe,"23 indicating its constant awareness of the implicit nature of the Moscow Memorandum in relation to Austria's participation in the West. Thus, while Austria's Declaration of Neutrality is primarily military in nature, and does not explicitly limit Austria's membership in international organizations, Austria remained outside of the EC in favor of the EFTA. This was largely because of Soviet concerns over Austria's violation of its neutrality by getting closer to Germany, and thereby, closer to NATO. Finally, Austria's attachment to neutrality is evidenced in the way it has permeated both its domestic and foreign affairs. For example, during the Cold War, Vienna served as the meeting point for several international agencies, largely because of its "neutral" status in a bi polar atmosphere, which reaffirmed the utility of the policy to both the international and domestic environment.24 Political Parties in Austria Since 1955, while the various administrations within the Austrian government have indicated their awareness that Austria was neutralized (which includes many negative connotations), the Austrian public has attached many

Panfried Rauchensteiner, "Austria Under Allied Occupation, 1945- 55." In The Austrian Solution. 125-141: 140.

^Schlesinger, 88.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 5 1 positive connotations to Austria's neutrality and looks to it as part of its national identity and political culture. Indeed, many Austrians credit neutrality as the primary reason why Austria has been successful since the end of WWII. Since a referendum will need to be held in Austria before EC/EU membership is confirmed, the Austrian government must therefore ensure that it coordinates well with Brussels for a package that the majority of people will accept (i.e., retention of neutrality within the EC/EU). Although the differences of opinion in Austria cannot be entirely explained in partisan terms, it is interesting to note the trends. For example, while the Christian Democratic People's Party (OVP) generally stresses the importance of relations with western Europe, and advocates integration with the EC, the Socialists (SPO) generally prefer a "go-it-alone” approach. In addition, although Austria's Green and Freedom parties think that neutrality is no longer relevant in today's changed circumstances, the Social Democratic Party thinks that it is. However, Foreign Minister Alois Mock has boiled neutrality down to the core of the contents in Article One of the State Treaty: "'To assure these objectives, Austria shall in future enter into no military alliances and shall not permit the establishment of foreign military bases on its territory.'"25

“ibid, 24.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 5 2 Austria/s National Security Policy Austria is eager to participate in a regional European security framework such as the EU's CFSP. Austria does not, however, see the need to drop neutrality in order to do so because of the distinctions between a CFSP and a military alliance. As stated by the Social Democratic Chancellor Franz Vranitzky: "'[a] system of collective security, such as the future European security system, should not be confused with a military alliance... [and the Austrian Government will not]... issue a 'blank cheque' promising the abandonment of neutrality.1,26 With the demise of the Cold War, Austria's national security policy juggles two goals: "... strengthening its own defences while pursuing foreign policy initiatives to promote economic and social stability in neighboring countries in the throes of reform."27 This, however, is not a drastic change from what Austria practiced as its national security policy during the Cold War. Moreover, when recently asked about whether or not Austria intends to retain its neutrality, Foreign Minister Mock responded: "[o]nly if the WEU does not become a regional alliance in accordance with the United Nations but rather a military alliance will a decision on WEU membership and the

“ibid, 24-25.

^Otmar Lahodynsky, "The Changing Face of Austrian Neutrality," NATO Review 40, no.6, December 1992, 25.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 5 3 abandonment of neutrality have to be made."28 Austria's Defense Minister Werner Fasslabend has stated that the Austrian Federal Army is being reorganized and is adjusting its "territorial defense concept" from its Cold War focus on the East-West confrontation to the more local ethnic conflicts.29 Indeed, the proximity of the Yugoslavian conflict since early 1991 has provided Austria with all the more reason to express its concerns in the rapid development and implementation of a viable European security policy. The war's outbreak was a harsh reminder of one of the negative side-effects in the collapse of the Iron Curtain - resurgent nationalism. The Austrian government provided its immediate support for Slovene and Croat independence while it waited for the EC's response to the conflict. Yet, the EC was not unified in a position toward the conflict. Similar to the World War I approach, Germany sided with Austria for an independent Croatia and Slovenia, while Britain and France, along with the U.S., were more inclined to side with Serbia and its efforts to keep Yugoslavia unified.30

a"Mock Reaffirms Support for Neutrality Status." FBIS-WEU 93-017. January 28, 1993, 3. See also: UN Charter, chapter VIII.

^Austria currently has a rapid reaction force of 15,000, and approximately 200,000 reservists. It wants to change to a rapid deployment force by 1996 with a capacity of 120,000 soldiers. Moreover, Austria is upgrading its equipment to include: ”... new armoured vehicles, helicopter gunships and anti-tank and anti-aircraft missiles...." Ibid.

“Josef Joffe. "The New Europe: Yesterday's Ghosts." Foreign Affairs 72, no.l (America and the World: 1992/93), 1993, 29-43: 32.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 5 4 European Neutrality in the National Context: Sweden Sweden's Adoption of Neutrality Unlike Austria's adoption of neutrality, the origin of Swedish neutrality is not easily distinguished since it was self-chosen and not enshrined in its constitution. In modern history, Sweden's neutrality is often traced back to the two World Wars, during which Sweden was able to remain neutral despite the hostilities surrounding it. However, identifying this point of time as the moment Sweden began its policy of neutrality is debatable since even prior to this time, the essential preconditions for a policy of neutrality had been formulated during the 1814 reign of Karl Johan, when Sweden's expansionist foreign policy fundamentally changed.31 Therefore, while the Swiss can reference the 1815 Congress of Vienna declaration when international recognition of its neutrality occurred (and was reaffirmed in the Versailles Peace Treaty); and the Finns can reference both the 1948 Treaty of Friendship and Cooperation with the Soviet Union and the 1956 Soviet return of the Porkala naval base which enabled the country to assert its neutrality; and the Irish can reference the 1938 British return of the three ports retained under the 1921 treaty as the point when its neutrality began; and the Austrians can refer to the 1955 Declaration of Neutrality;

3lXrister Wahlback. The Roots of Swedish Neutrality. Stockholm: The Swedish Institute, 1986: 7.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 5 5 no such reference point exists for the Swedes. Furthermore, Sverker Astrom, former Swedish Ambassador to the United Nations, points out the difficulties in attempting to find a national definition: ... a 'genuine' neutrality policy ... cannot be sought in some kind of logical analysis of an absolute concept of neutrality. We must resort to pragmatism and seek guidance in international law, in history, in a study of the political and strategic interests of the great powers, and in the rational assessment of the current international political situation.32 Such an adaptable approach to neutrality only reaffirms the •'means and end" process of neutrality: "[n]on-alignment in peace between power blocs in order to be able to retain neutrality in the case of war."33 Despite its flexibility (and perhaps because of its flexibility), both the Swedish government and Swedish citizens have tended to view Sweden's neutrality policy as "axiomatic."34 In 1950 Swedish Foreign Minister Osten Unden reflected on the historical

“Astrom, Sweden's Policy of Neutrality. 6.

“Nils Andren, "Sweden's Security Policy." Cooperation and Conflict 7, nos.3-4 (1972), 127-153: 143.

^Mats Bergquist, "Sweden and the EEC: A Study of Four Schools of Thought and Their Views on Swedish Common Market Policy in 1961-1962." Cooperation and Conflict 6, no.l (1971), 41.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 5 6 effectiveness of neutrality for Sweden: [t]he fact that Sweden has been able to remain at peace for 135 years has undoubtedly had a strong psychological effect on the attitude of the Swedish public towards the problem of security.... Whatever the explanation may be for our avoidance of war, our people cannot easily be convinced that their security now requires the abandonment of neutrality as an ineffective and out-of-date policy.35 Therefore, neutrality's resilience is particularly exemplified by the Swedish model since it has been evolving since early 19th century Europe as a means to an end. Thus, despite the end of the Cold War, Sweden aims to retain its neutrality in tandem with EC/EU membership. Although today's changed international circumstances provide greater likelihood of the Euro-neutrals joining the EC than at any other time since the EC's creation, neutrality would still have been compatible with EC membership during the Cold War because of the state-dominant nature within both the EC and EPC regimes. This is discussed further below. Sweden's "Active11 Neutrality After WWII, adjustment was bound to occur in Sweden's neutrality policy given the emerging bi-polar world and the intense ideological confrontation rapidly evolving between East and West. However, Sweden made certain other nations were aware it had no intention of "choosing sides" nor, at the same time, of being ideologically neutral. In this way, the concept of "active" neutrality became increasingly

^ahlback. The Roots of Swedish Neutrality. 80.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 5 7 important during the Cold War. The transition, or redefinition from the 19th century brand of "passive’' neutrality to the 20th century brand of "active" neutrality was best exemplified in Sweden's participation in UN peacekeeping efforts and Sweden's role as a mediator in international conflicts in allowing Stockholm to be used as a meeting place of neutral ground. Nils Andr6n explains: Sweden's active neutrality has become a doctrine as deeply rooted as ever to the previous doctrine of neutrality - of the foreign policy which was sometimes referred to as the policy of not having a policy. In Palme's words tc the National Press Club in Washington, 1970: 'Neutrality does not mean isolation. A small country cannot permit herself to be isolated....Our neutrality does not condemn us to silence. Participation is to hold views and take stands.../36 However, in having views and taking stands, Sweden has not overlooked its responsibility to the ramifications of such tendencies on the credibility of neutrality: ...'active neutrality' in the Swedish version must, almost by definition, mean activity supported by the authority derived from neutrality but not such activities as may reduce the credibility of the independent choice of position in the international system.37 Moreover, Sweden views the credibility/consistency factor of its neutrality so strongly that any consideration of abandoning it now would actually undermine what it has meant

36Andr§n, "Sweden's Security Policy," 142-143.

^Ibid, 141, emphasis added.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 5 8 during the past two centuries.38 For example: ... the impression of unchangeability is, perhaps, strengthened by the fact the Government cannot launch into a debate about a possible revision of neutrality policy. That would give rise to speculation and doubts of the steadfastness of the policy.39 Thus, despite changed circumstances, Sweden will likely retain its policy of neutrality during the post Cold War era to preserve the credibility and consistency of the policy in its own eyes, if not for others. Political Parties in Sweden Prior to the end of the Cold War, all political parties in Sweden generally accepted the policy of neutrality. Yet neutrality's compatibility with EC membership fluctuated between party lines and has constantly been on the agenda since the EC and the EFTA were created. As mentioned in the last chapter, the first internal debate on the compatibility factor occurred when Britain first applied for EC membership in 1961.40 Mats Bergquist identified four major approaches to the EC membership debate in Sweden during 1961-1962. There was 1) the membership school, which consisted of the Conservative and Liberal Parties and the Federation of Swedish industries; 2) the

*01f Lindell, Second Secretary at the Swedish Embassy. Interview by author, 9 February 1993, Washington, D.C. Tape recording. Embassy of Sweden, Washington, D.C.

wAstrom, Sweden's Policy of Neutrality. 19, emphasis added.

^See: Bengt A.W. Johanson. "Sweden and the EEC: An Approach to the Study of the Political Process." Cooperation and Conflict 5, no.4 (1970), 286.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 5 9 association school, which consisted of the Social Democratic and Center Parties and the Confederation of Trade Unions as well as the Cooperative movement and farmers organizations; 3) the non-accession school, which was a faction of the Social Democratic Party; and 4) the anti-accession school, which was the Communist Party.41 While the membership school conceded there were compatibility problems, it insisted that Sweden had much to gain economically from joining the EC and that it should seek to find an arrangement with the EC "... with the aim of securing certain escape clauses so as to satisfy particular Swedish interests. It was far better to be a member of the Community and be able to influence its decisions".42 Similarly, the Liberal and Conservative Parties wanted to ensure that Sweden retain its independence by having a say in the EC decision-making process, so they could guide the decisions that would directly affect them.43 Moreover, they did not want Sweden's neutrality to be grouped with either Austria or Switzerland "... since it would unnecessarily tie her hands.”44 The association school wanted to gain economic access to the EC, but also wanted to retain full

4IBergquist, "Sweden and the EEC: A Study of Four Schools of Thought and Their Views on Swedish Common Market Policy in 1961-1962," 41.

^Mats Bergquist. "Sweden and the European Economic Community." Cooperation and Conflict 4, no.l (1969), 6, emphasis added.

^aite, 328.

bergquist, "Sweden and the European Economic Community," 6, emphasis added.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 6 0 political leverage over its neutrality policy. The anti accession school insisted that Sweden would be best off on its own. The non-accession school was ideologically opposed to EC membership since it saw it as an arm of NATO. As such, it was relatively easy for the Social Democrats to criticize the Liberals and Conservatives as "bad guardians" of Sweden's neutrality since the Social Democrats viewed neutrality more as an end in itself and the Liberal and Conservative Parties clearly saw neutrality more as a means to an end. Sweden placed its bid for EC membership in 1991 during the reign of the Social Democratic Prime Minister, Ingvar Carlsson. No reference was made to neutrality in its application. This, however, did not mean that the Swedes no longer considered neutrality to be a salient issue; rather that they considered the EC's EPC and the EU's CFSP to be so compatible with their neutrality that it was axiomatic Sweden would retain its neutrality with membership. Today, with the Conservative Party in power under Prime Minister Carl Bildt, this same approach is apparent, with Sweden's economic interests taking clear priority as the main motivator for EC membership. Sweden's National Security Policy Sweden's security and defense policies are intertwined in a concept known as "total defense." This essentially means economic self-sufficiency coupled with a significant

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 6 1 defense capability. Nils Andren explains: [t]he emphasis on [total defense] serves as a reminder of the fact that both defence and security are more than matters for the military, and possibly also, the diplomats. Defence is a function which involves practically everybody and all aspects of society. In this respect defence has to be total and planned so that all activities are taken into account. For Sweden ... economic defence - in different forms - has always assumed comparatively great significance."45 Such "total defense" would, for example, allow Sweden to withstand a blockade if this needed to be implemented. In 1968 Swedish security goals were defined and outlined in an official statement by the government and Rikstag as: - contributing towards a peaceful development of the world; - contributing towards a reduction in antagonism and to greater understanding between nations; - contributing towards creating a world in which small States can also express their interests; - contributing towards reducing the strategic interests of the Great Powers to drag Sweden into a possible war; - already in peacetime safeguarding our interests with due regard to international solidarity; - protecting our democratic liberties and rights.46 Thus, Swedish security policy focused on both the international and domestic environment. As Sweden saw it, the more stable the international environment, the more enhanced Sweden's own security became. Thus, while Sweden's foreign policy positions tended to be "active" as reflected in its harsh criticisms of such conflicts as the Vietnam War, this actually plays only an indirect role in Sweden's

^AndrSn, "Sweden's Security Policy," 129-130.

*Ibid, 141.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 6 2 immediate security. On the other hand, Sweden is a rather passive international actor as far as its immediate security is concerned, and would have preferred that the so-called splendid isolation of the Nordic Balance remain beyond the Cold War.47 Yet, after the Cold War, Nordic cooperation is becoming more visible. For example, at the request of UN Secretary-General Boutros Boutros Ghali, Sweden, along with Denmark, Finland and Norway have formed a joint UN battalion to assist in UN peacekeeping efforts in Macedonia. This 750-strong battalion was to relieve the Canadian 150-strong company which was temporarily deployed to Macedonia for preventive measures until mid-February 1993.48

^With the emergence of the superpowers, Sweden linked its policy of neutrality to the Nordic region, a potentially strategic flank for either superpower. Although it attempted to forge a Nordic security and defense arrangement after WWII which would collectively proclaim neutrality to the rest of the world, none of the other Nordics wanted to join. Instead, in 1948, Finland signed its Treaty of Friendship with the Soviet Union, exemplifying the asymmetrical neutrality policy it was to follow during the Cold War. In 1949, both Denmark and Norway opted for the more distant security blanket of NATO, which is understandable given their respective bad experiences in practicing neutrality during WWII. Consequently, Sweden chose to pursue the neutrality route on its own. Nevertheless, Sweden assumed a role as "stabilizer” within the so- called Nordic balance, and helped to ensure that the area maintained a low-profile option for military operations by its own practices of "dissuasion". This "stabilizing influence" was particularly important given the Soviet naval bases along the eastern portion of the Baltic. However, those bases have since closed and the Baltic States are now independent.

•"Nordic Nations Join For UN." Jane's Defence Weekly 19, no.3 (January 16, 1993), 7.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 6 3

European Neutrality in the National Context: Ireland Ireland/s Adoption of Neutrality In 1921, the twenty-six counties which make up today's Republic of Ireland won their independence from the United Kingdom. However, under the 1921 treaty, three Irish ports were retained by the British. It was not until the ports were returned to the Irish in 1938 that the Irish generally consider their neutrality began. However, neutrality is not enshrined in Irish law. Nevertheless, Ireland's neutrality policy is clearly asymmetrical toward the United Kingdom. For example, after WWII, although Ireland was interested in the possibility of NATO membership, it ultimately did not join because the United Kingdom was a member of NATO. Indeed, Ireland had attempted to negotiate for NATO membership by putting an end to its partition; in other words, Ireland would join NATO under the condition that it would be reunified, which would require British withdrawal from Northern Ireland. As history unfolded, however, Ireland was in no position to dictate terms to any nation, and the United States was not about to abandon its friendship with the United Kingdom by insisting on Ireland's reunification. As a result, after WWII Ireland became literally "stuck" with the policy of neutrality. Given the retention of neutrality under these terms, or, as the "second best" option, it is no wonder

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 6 4 Ireland's neutrality has been considered to be "negotiable," or somewhat ad hoc, since references were made during the Cold War that Ireland would cease to be neutral if it were to be reunified. Ireland Joins the EC The "negotiable" style of Ireland's neutrality was further raised when Ireland joined the EC during its first enlargement in 1973, along with the United Kingdom and Denmark. Indeed, there was speculation as to whether or not Ireland would have to give up its neutrality in order to join, and that if Ireland had been asked by the EC to do so, it would, simply because it was not well-off economically and literally "needed" the EC, given that the United Kingdom, Ireland's primary trading partner, would also be joining the EC.49 In addition, while the EC had a common agricultural policy (CAP), the EFTA did not include the agricultural sector. Consequently, Ireland did not have a better economic alternative than to join the EC. Nevertheless, Ireland stated that "[t]here [are] no reservations about the political and economic obligations of membership, and indeed, 'whenever the defence of Europe arises we will play our part', although apparently membership did 'not require us to abandon our neutrality

^In 1966, Ireland and the United Kingdom formed the Anglo-Irish Free Trade Area (AIFTA).

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 6 5 status.'"50 Moreover, "[w]hile for the Swedes 'neutrality is determined by fundamental evaluations relating to security policy, not by economic interest', the Irish never felt free to take the same view."51 The simplest explanation for this is that Ireland did not have the economic resources which Sweden had, and it could therefore not be as "choosy" as the Swedes. However, often overlooked in Ireland's decision to join the EC (since the economic benefits for Ireland were abundantly clear), is that Ireland was aware that the best way to have influence was through participation. This paradox of joining an institution so that individuality may be asserted is all too often neglected as a viable motivating factor. Joining the EC was a particularly prudent move by Ireland since it was a way to reassert its own identity as a nation, and especially as a nation distinct from the United Kingdom. Indeed, as a result of EC membership, Ireland was to gain recognition on an international scale it would have likely not accomplished otherwise. Consequently, the particular significance of Ireland's joining the EC while retaining its neutrality is

“Trevor C. Salmon, "Ireland: A Neutral in the Community?" in Journal of Common Market Studies 20, no.3 (March 1982), 201-227: 213.

31 Ibid, 215.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 6 6 essentially twofold: ... it provides a rather stark illustration of the underlying pressures of economic interdependence on the foreign policy of small countries.... [and] demonstrates the persistence of forms of political autonomy. which resist the centralizing logic of interdependence as expressed in the institutional networks of regional integration.52 Indeed, a small country with a weak economy has few options. Of the Euro-neutrals, Ireland was by far the worst off economically. Therefore, during the 1970's, integrating with the EC was a much higher priority for Ireland than it was for the other neutrals for basic economic reasons.53 In fact, Ireland's joining the EC when it did preserved the "end" side of neutrality much better than staying outside of the EC would have since it was a way for Ireland to reassert its national identity and preserve its sovereignty. As part of its decision to "widen" its membership, the EC wanted to alleviate the potential of diluting the gains it had thus far achieved in integration. As such, the EC concurrently designed plans for "deeper" political and economic integration via the Davignon and Werner Reports. However, Ireland decided that since the EPC was in its preliminary stages, as set forth under the Davignon Report,

“Keatinge, "Neutrality and Regional Integration: Ireland's Experience in the European Community,” 61-62, emphasis added.

53The situation which the Euro-neutrals face today in the 1990's is similar to the situation Ireland faced in the 1970's. While the four Euro-neutrals' "postponed the inevitable" as long as they could by choosing not to join the EC because their economies were strong, they now find themselves in a similar circumstance with the passage of time and the growth of interdependence.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 6 7 it did not consider its neutrality to be threatened by something that had yet to be developed. This, of course, is very similar to how the Euro-neutrals think today about the CFSP, which has yet to be developed, and which they plan to play a significant role in developing, once they are EC members. Interestingly, the Euro-neutrals today have caught up to the point where Ireland was in 1973, when it joined the EC. The point in time has arrived where it is more advantageous to participate, and secure sovereignty through the very act of contributing to the process, than it is to stay outside of the EC. As such, what would be most beneficial to the Euro-neutrals during the EC membership negotiations would be an attempt to collectivize the common threads of each of these brands of neutrality in order to retain it in one form or another. However, what would be profitable and what actually occurs could likely be two different things. Ireland's National Security Policy Given its geo-strategic location on the periphery of the European continent, Ireland has not had to concern itself with the prospects of several potential aggressors. Rather, Ireland's security policy has been asymmetrically concerned with its relationship with Britain and the goal of reunification. While Ireland is currently the only neutral member of the EC, it has not been inflexible in cooperating with its fellow EC members as far as foreign policy

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 6 8 cooperation via the EPC mechanism is concerned. This is discussed in greater detail below. Moreover, such flexibility is likely to grow given the prospective CFSP as designed under the EUT. Indeed, one month before the December 1991 Maastricht Summit, a Foreign Ministry Spokesman said: "' [ i ] f the Community devises a defence policy of itself and for itself, we will consider participating in it.'"54 Indeed, Ireland has participated as an observer to the WEU to discuss the Yugoslavian conflict, which is seen as a sign of supporting the CFSP. According to Professor Desmond Dinan "both NATO and the WEU are products of the Cold War. The next security-related conference will be devoted to a post Cold War organization to which Ireland will subscribe."55 Thus, it is not necessarily a question of Ireland joining NATO or the WEU, but rather the new post Cold War organization that has yet to be developed, and which Ireland, along with the Euro- neutrals, will help to develop in 1996 as part of the institutional reform process. However, Ireland, like the

^Quoted in Tim Coone's "Irish Ponder the Future of Their Neutrality," Financial Times. November 22, 1991, emphasis added.

Desmond Oinan, Professor at the George Mason University. Interview by author, 10 February 1993, Arlington, VA. Tape recording. The George Mason University, International Institutes, Arlington, VA.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 6 9 other Euro-neutrals (as well as the UK and Denmark): ... still prefers to draw a distinction between security and defence. It will support without hesitation global security issues such as disarmament and peacekeeping operations, but military alliances remain a delicate issue to be left for later. Hr Haughey said '[w]e take the view that the framing of common defence policy is something for the future... to be taken up when the CFSP is reviewed in five or six years' time". At that point, he said, 'if the Community were to develop its own defence arrangement for its security, then Ireland would consider participating. '**

The EPC and CFSP Regimes: Background Although the EPC was not formally created until 1970, political cooperation and integration amongst the EC member states was a stated goal of the 1957 Treaty of Rome. During the immediate post-war period, ambitious plans for economic, defense, and political platforms were discussed via the European Coal and Steel Community (ECSC), the European Defense Community (EDC), and the European Political Community (EPC). While all three organizations were planned to co-exist, the failure to secure political integration along side economic integration soon made the ECSC members realize that they would have to separate the economic and political tracks of integration, even if the two were envisioned to ultimately meld into one European Union at some unforeseeable time in the future. Thus, this type of economic and political integration parallelism proved to be

*Coone, "Irish Ponder the Future of Their Neutrality," Financial Times, emphasis added.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 7 0 premature and too ambitious for a Europe just emerging from two World Wars. The 1960's represented a time of contention for European integration primarily because of the opposing grand designs for Europe through either supranational or inter governmental structures. Indeed, the first major confrontation in the European integration debate over the "logic of integration" versus the "logic of state sovereignty" culminated in the 1965-1966 "Empty Chair" crisis, led by France's President Charles de Gaulle. By the end of the decade, however, de Gaulle had resigned from office and the way was made clear for the first EC enlargement to include the United Kingdom, which de Gaulle had twice vetoed for membership during the 1960's. In conjunction with the EC's first enlargement, the EC wanted to ensure that its widening process would not be at the expense of its aspirations to deepen its integration. Thus, the 1970's represented a breakthrough for Europe because pragmatism entered into the European equation for integration. The result was two distinct regimes to attend to European integration on an economic level (via the EC) and European cooperation on a political level (via the EPC). Consequently, the EPC, as it was created in 1970, must be understood as a result of what was politically acceptable by all EC members in the lowest common denominator form. This, in turn, only reaffirmed the inter-governmental nature of

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 7 1 the EPC regime as distinct from the supranational nature of the EC. European Political Cooperation through the SEA The primary aim of the EPC is for the EC members to consult/discuss international issues which affect all of them, thereby increasing understanding in an effort to coordinate views. Moreover, the hope is that by coordinating views, they can also coordinate common actions. As such, EPC is the political seed of the European Union.

Institutional Development of the EPC The Hague Conference convened in 1969 and the Davignon Committee was appointed to design a strategy which might attempt to harmonize member states7 political policies. The resulting Luxembourg Report is generally regarded as the mandate of the EPC.57 Under the Luxembourg Report, the EPC was not as centrally-designed as the EC; rather, its institutions were designed to operate on a strictly inter governmental basis.58 As created by its member states, the EPC's authority lies in the member states themselves and therefore it is an institution which accommodates national

^France, however, considers the EPC mandate to derive from the 1961 Fouchet Plans, designed by de Gaulle.

^For example, the Report structurally set up the Foreign Minister Councils which meet two times a year, and a Political Committee (POCO) which meets more often to prepare for the bi-annual Foreign Minister meetings. In this way, the POCO is similar to the EC's inter governmental arm, the Council of Minister's Committee of Permanent Representatives (COREPER).

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 7 2 foreign policy prerogatives, despite the "prior consultation" feature which evolved over the next fifteen years, and was eventually made "obligatory" in the Single European Act. In 1973, the EPC expanded its institutional structure by issuing the Copenhagen Report in which a Group of Correspondents was designed to follow-up the Foreign Minister meetings. Working groups were also established, which were organized on a regional and geographic level. By 1975, the European Council was developed to serve as the formal manifestation of a link between the EPC and the EC. It is composed of the member countries' Heads of State or Government. It, like the EPC, gained its first formal acknowledgement in treaty form in the SEA.59 The 1981 London Report established the "troika" mechanism within the EPC, which involved the preceding, present and succeeding presidencies of the Council to coordinate for more continuity in EPC. The EC Commission was also given more authority by serving as the only permanent representative to the troika. In addition, the London Report established the crisis control mechanism which allowed any three members to call an emergency meeting within 48 hours.60 Lastly, the

wSee: Shirley Williams, "Sovereignty and Accountability in the EC." In The New European Community; Decisionmaking and Institutional Change, ed. Robert O. Keohane and Stanley Hoffmann, Boulder, CO: Westview Press, 1991, 156.

‘‘’Th i s was largely developed as a response to the many international crises which occurred from 1979-1981 to include the Soviet invasion of Afghanistan, the Middle East crises, and the Solidarity movement in Poland. These and other EPC actions are discussed below. For a discussion on the creation and implementation of the EPC, see: Guy de

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 7 3 London Report announced that EPC had become "a central element in the foreign policy of the member states.”

Voting Procedures in the EC/EPC Voting procedures are a crucial part of the integration process since they reflect varying degrees of commitment amongst the participating states. While the principle of unanimity and consensus reflects the inter governmental nature of an institution, the principle of majority voting reflects the supranational nature of an institution. Logically, therefore, those areas in which majority voting occurs must be agreed to by all participating members - therefore by consensus. This is clearly a catch-22 situation by none other than European design. The 1957 Treaty of Rome clearly calls for majority voting,61 and by mid-1965, the EC Council of Ministers was ready to begin to apply this type of voting, indicating a step toward "genuine supranationality.”62 However, from June

Bassompierre's Changing the Guard in Brussels: An Insider's View of the EC Presidency. New York: Praeger Publishers, 1988, especially chapters 4 and 5.

61With the current EC-12, an issue must receive 54/76 votes in order to achieve a majority vote in the Council of Ministers. The amount of votes per country are as follows: 10 each for France, the Federal Republic of Germany, Italy, and the United Kingdom; 8 for Spain; 5 for Belgium, the Netherlands, Greece and Portugal; 3 for Denmark and Ireland; and 2 for Luxembourg.

®Roy C. Macridis. "French Foreign Policy: the Quest for Rank." In Foreign Policy in World Politics: States and Regions. 7th ed., ed. R. Macridis. Englewood Cliffs, NJ: Prentice Hall Pubs., 1989. 47.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 7 4 1965 to January 1966, France's President de Gaulle decided to boycott the EC by walking out of a meeting in which France could be potentially out-voted if majority voting was to be implemented. According to de Gaulle, "... the assumption of power by a body of 'stateless' functionaries was prejudicial to the independence of the sovereign member states."63 The result of the so-called Empty Chair crisis "... increased the control of national governments over the Community ... since the modification concerning the balance of powers among the institutions had, in fact, worked out in favor of the Council of Ministers."64 Hence, de Gaulle reinforced the power of the nation-state by obtaining a veto prerogative for each member state in issues deemed "vital." As a result, the Luxembourg Compromise ensured that " __ the Common Market [would] remain a purely economic arrangement, held together by the will of sovereign and independent states, and subject to the veto power of each and all."65 Yet, each nation's "vital" interests are extremely subjective, change according to domestic policy concerns, and are largely political, fluctuating from year-to-year.66 Essentially, then, the Luxembourg Compromise revealed "... that the Common Market is dependent on a political

®Ibid.

“Ibid.

“ibid.

“W. Wallace. "Walking Backwards Towards Unity," 303.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 7 5 environment: over which, in the final analysis, it has little control."67 Although the Luxembourg Compromise did not have any statutory standing, it did have a lasting effect on the culture of the EC system from 1966 to 1984. It encouraged unanimity in an effort to avoid problems later on. This, in turn, led to stalemates within the Council of Ministers due to lack of consensus, and essentially bumped many of the unresolvable issues to the level of the European Council. Indeed, the 1975 Tindemans Report made a specific complaint over the veto prerogative established in the Luxembourg Compromise and requested "... a return for what the Commission called 'normal functioning of the institutions as laid down in the Treaties.'"68 Moreover, the Report aspired to apply majority voting not only within the EC but within the EPC as well; certainly a radical departure in voting patterns - so radical at this point in time that it was doomed.69 In preparation for the June 1984 European Council Fontainebleau Summit, British Prime Minister Margaret Thatcher circulated a paper entitled "Europe: The Future," in which, amongst other things, it elaborated on how the

nde La Serre, "The European Economic Community and the 1965 Crisis." In European Integration, ed. F. Roy Willis. New York, 1975, 151, emphasis added.

“Robert O. Keohane and Stanley Hoffmann. "Institutional Change in the 1980s." In The New European Community. 1-39: 36, fn 30.

“Pinder, 194-195.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 7 6 decisionmaking mechanism should change within the EC regarding the implementation of majority voting. As stated: "... nations should be able to veto 'where a very important national interest is at stake' but 'should be required ... to set out their reasons fully' before other Council members."70 During the Fontainebleau meeting, French President Frangois Mitterrand, then holding the rotating presidency of the EC Council of Ministers, was able to set up an ad hoc committee to, amongst other things, further address the issue of majority-voting in the EC. With the Ad Hoc Committee for Institutional Affairs (also called the Dooge Committee after its Irish chairman), a split was formed on the issue of majority voting and the veto. While seven of the ten EC members were willing to nullify the Luxembourg Compromise, two members joined the British position: Greece and Denmark. The three would only accept the "... voluntary, informal steps to encourage majority voting," and did not want to revoke the veto right. However, the remaining seven insisted on an inter governmental conference for drafting a European Union treaty.71 Ironically, during the 1985 Milan European Council Summit, an intergovernmental conference (IGC) was called by

70Moravcsik, Andrew. "Negotiating the Single European Act." In The New European Community. 41-84: 57.

71 Ibid, 59.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 7 7 majority vote for what was ultimately going to lead to the SEA. With the passage of the SEA twenty years after the Luxembourg Compromise, the use of majority voting increased substantially, but primarily only in those areas related to implementation of the single internal market program. In the SEA majority voting was also extended to include capital liberalization and air and sea transport, where unanimity had been applicable before.72 Moreover, a "new cooperation procedure" was introduced in an effort to deal specifically with majority voting procedures in the European Parliament. This procedure applies to approximately ten articles in the Treaty of Rome which deal primarily with the harmonization legislation for completing the internal market as well as research programs and structural funds.73 As such, the SEA can be seen as the "enabling instrument" for the 1992 program since it streamlined the EC decisionmaking process for the internal market issues. Nevertheless, despite the advances in voting procedures for the internal market, "safe-guard" provisions were also included in the SEA, offering a "quid pro quo" to the member states in exchange for their partially rescinding the security of the national veto. Primarily in areas

^oukas Tsoukalis. The New European Economy; The Politics and Economics of Integration. New York: Oxford University Press, 1991, 58- 59.

’’F o r a discussion of the SEA's new cooperation procedure see Juliet Lodge's "The SEA and the New Legislative Cooperation Procedure: A Critical Analysis," in Journal of European Integration 11, no.l (Fall 1987), 5-28.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 7 8 affecting harmonization in the internal market program, these safe-guards ensured an exemption for each member state in such politically sensitive issues as fiscal policy, the free movement of persons, and the rights of employees.74 Moreover, under Article 100a, par.4 of the revised treaty, the lowest common denominator decision-making process was further ensured.75 Not surprisingly, such caveats were reaffirmed during the 1990-1991 IGCs for the Treaty on European Union. Therefore, while the original text for the SEA devised during the IGCs had been written in a maximalist vein, what resulted was a victory for the minimalists. As Moravcsik concludes, the SEA "... reaffirms that the primary source of integration lies in the interests of the states themselves,"76 and Hoffmann concludes that the success of the SEA can be credited to its reaffirmation of national sovereignty.77

74Tsoukalis, 59.

Moravcsik, 60-63.

^Ibid, 75, emphasis added.

^Stanley Hoffmann, "The European Community and 1992." Foreign Affairs 68, no.4 (Fall 1989), 27-47: 31-32.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 7 9 SEA's Title III Nevertheless, both the European Council and the EPC were first formally recognized in the SEA's Title III. Although Title III was little more than the formalization of what already existed in EPC practice (plus an EPC Secretariat), this represented a huge step in the process of recognizing political cooperation as part of the European integration formula. Thus the aim of achieving a "European foreign policy"78 and of refraining "as far as possible from impeding the formation of a consensus and the joint action which this could produce"79 reflected the political will to attempt to coordinate more on achieving common positions in foreign policy. However, it did not commit the members to anything that could not be undone by "vital national interests." Thus, the bottom line remained the national prerogative in the EPC process. While the SEA is a legal document, and it officially obligated EPC members to prior consultations before decisions on national policies,80 the fact remained that the EPC only worked on the basis of unanimity. This is essentially unchanged since the Luxembourg Report of 1970, and it is therefore as "powerful" or "powerless" as it was in 1970. As Professor William

™SEA, Title III, Article 30 (1).

WSEA, Title III, Article 30 (3c).

"‘‘Th e obligation as stated in the SEA is to "inform and consult each other on any foreign policy matter of general interest."

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 8 0 Cromwell eloquently noted when reflecting on the EPC's actions in the pre-Gulf War crisis of 1990-1991: [d]espite progress since the early 1970s in developing procedures for political co-operation, and in the forging of common positions on particular issues, the requirement of unanimity meant that foreign policy decisions remained under the ultimate control of national governments.81 Moreover, while the EC is legally binding, the EPC is not; therein lies the distinctions between the two regimes of economic and political integration - despite the "bridgework" accomplished by the European Council and the SEA revisions. Finally, by clarifying the institutional links between the EC and the EPC the SEA reaffirmed that the Presidency served the predominant role, despite the creation of the Secretariat or the enhanced role of the Commission. As a result, this reaffirmed the inter-governmental nature of the EPC at the expense of both the institutional and supranational natures. Nevertheless, as Jean de Ruyt points out, "[sjince it is not possible to escape EPC without renouncing participation in the EC, Member States are more and more committed to a de facto limitation of their national sovereignty in foreign policy."82 This is where the "walking backwards towards unity" which William Wallace

*‘william Cromwell, "Europe, the United States, and the Pre-War Gulf Crisis," in International Journal. 124-150, XLVIII (Winter 1992-3): 147, emphasis added.

eJean de Ruyt, European Political Cooperation: Toward a Unified European Foreign Policy. Occasional Paper, The Atlantic Council of the United States, Washington O.C., October 1989, 16-17.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 8 1 writes of comes into play, since progress often occurs where one least expects it. Nevertheless, Cromwell reaffirms the limits of the EPC: [notwithstanding frequent affirmations by EC members of their intention to develop common policies and to take joint action through EPC, concrete obligations have not risen above the pledge to consult before the adoption of national positions.83 SEA's Foreign and Security Policy Implications The core of what resulted in the SEA's Title III as concerns a European foreign policy amounted to discussion of only "the political and economic aspects of security."84 As stated in the SEA: [t]he High Contracting Parties consider that closer cooperation on questions of European security would contribute in an essential way to the development of a European identity in external policy matters. They are ready to coordinate their positions more closely on the political and economic aspects of security.85 This, of course, raises the question of what "security" means. In the strict sense of the word, "security" has traditionally meant military security via defense, and during the Cold War, this was something that the EC, as well as EPC, clearly delineated as being outside their respective

°Cromwell, "Europe, the United States, and the Pre-War Crisis," 147.

ironically, this reflected the same strategy that Britain reinforced in the Council of Europe during the 1950s, since no one wanted to step on the toes of already-existing security structures such as NATO.

“SEA, Title III, Article 30 (6a), emphasis added.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 8 2 jurisdictions since this was already included in NATO.86 Yet, security as a contemporary issue has gradually evolved into a much more comprehensive concept to include many aspects of a nation's foreign and domestic policy, such as economic, technological, social, cultural and moral issues.87 Such an evolution has caused the blurring of the distinctions between what is economic policy, what is foreign policy and what is security policy. Because of these implications, security has been a theme not easily introduced in relation to the EC/EPC. Indeed, after the failure of the EDC during the 1950's, security was not raised again until almost thirty years later in the ambitious Genscher-Colombo Plan. The 1981 Genscher-Colombo Plan was generated by the Council of Ministers and envisaged amalgamating the EC and EPC regimes under a single roof, as well as extending the agenda of EPC into the security field. Proposed to the Council of Ministers by the German and Italian Foreign Ministers Genscher and Colombo, it was generally welcomed by the Council, despite its grand objectives. However, because of the implications on the already-existing security frameworks, disputes inevitably arose between national

“indeed, in many ways, the Europeans were relieved of the duty to defend themselves because of NATO's nuclear umbrella, and could thus focus on economic integration.

^Marek Grela, "The Debate on European Security in Poland." In European Polyphony; Perspectives Beyond East-West Confrontation, ed. Ole Waever, Pierre Lemaitre and Elzbieta Tromer, (New York: St. Martin's Press, 1989), 111.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 8 3 policies, and ultimately led to the demise of the Plan.88 What resulted in place of the Genscher-Colombo Plan was the diluted 1983 Stuttgart Solemn Declaration. However, even this proved to present problems for various members.89 For example, Greece qualified its acceptance of the Stuttgart Declaration by stating that "'whilst signing this Declaration, Greece declares that nothing can restrict its right to determine its foreign policy in accordance with its national interests.'"90 Consequently, those states which wanted to create a collective European security arrangement were forced to look outside the EC's institutions. As such, the Declaration provided additional impetus for the revival of the Western European Union (WEU) .9I However whether the

“Ireland was particularly put off by the collective defense overtones inherent in the Genscher-Colombo Plan. However, Ireland's position seemed to be supported by others within the EC because the 1981 London Report restricted EPC to consultations on the "political aspects of security."

“indeed, some of the EC member states simply refused to discuss security issues within the framework of the EPC. For example, Ireland had its neutrality and Denmark had its Nordic neighbors to consider.

*°Frangoise de la Serre, "The Scope of National Adaption to the EPC." In European Political Cooperation in the 1980s; A Common Foreign Policy for Western Europe? ed. Alfred Pijpers, Elfriede Regelsberger and Wolfgang Wessels, 194-210. Kluwer Academic Publishers, The Netherlands, 1988, 196.

’’Although the WEU's origins lie in the 1948 Brussels Treaty Organization and it was formally created in 1955 to control the rearmament of West Germany (after the failure of the EDC), once it had accomplished this task it was generally neglected since other forums, such as NATO and the CSCE capably covered the areas it was designed to handle. Only the French held on to the WEU as an option for a future European defense. The WEU's 1983-4 "reactivation" via the Rome Declaration largely occurred as a response to U.S. development of the strategic defense initiative (SDI), and the fear within Europe that the U.S. was abandoning its commitments to the continent. Moreover, the 1987 "Platform on European Security Interests" reaffirmed Europe's interest in more effective military cooperation in the WEU. Thus, a concerted effort was made to reinvigorate the already-existing European

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 8 4 WEU represented the best instrument for "Europeanizing" security in Europe was an issue hotly debated amongst its members, and so remains the case today.92 Clearly, no mention of defense was raised in the SEA and, in fact, seems to be avoided in a most purposeful way. Nevertheless, the SEA declares that "nothing in this treaty shall impede closer cooperation in the field of security between certain of the High Contracting Parties within the framework of the Western European Union or the Atlantic Alliance."93 Therefore, as a result of the SEA, within the EC-related institution of the EPC (as opposed to the "outside" institution of the WEU), only the "political and economic aspects of security" would be up for discussion. Therefore, inherent limitations were built-in to the SEA by the member states themselves. But in so doing, the members were ensuring the "best of both worlds" by presenting a "... flattering outside image and the benefits of collective diplomacy without any real constraints or renunciation of

defense organization, to which nine of the EC members already belonged (Denmark, Ireland, and Greece were not WEU members).

^Also referred to as the "European pillar of the Atlantic Alliance," because of its relations with NATO, the WEU's role was minimized during the Cold War by the Europeans themselves so that Europe could focus on its economic integration. Now that Europe was well-off economically, it was ready to be taken more seriously in the security field. However, such a shift in gears is hard to swallow by the rest of the world, especially if the conditions were self-imposed. For a discussion of this dilemma see Robbin Laird, The Europeanization of the Alliance. Boulder: CO, Westview Press, 1991.

’’SEA, Title III, Article 30 (6c).

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 8 5 sovereign rights."94 This was reaffirmed in the Maastricht Treaty, and is discussed in greater detail below. Ratification of the SEA Although the SEA was signed in February 1986, it was not ratified by all member states until mid-1987. Indeed, ratification of the SEA took longer than expected, largely because two of the so-called footnote countries, Denmark and Ireland, had sensitive issues they had to resolve before ratification. The third of the footnote countries, Greece, did not have any problems in the SEA's ratification, since its problems seemed to be resolved by its amendment to the Stuttgart Declaration, discussed above. Denmark's primary concern over ratifying the SEA rested on the potential implications that the EPC would have for Denmark's links to its fellow Nordic partners through such platforms as the Nordic Council. Thus, Denmark provided a "Declaration appended to the Final Act of the Single European Act noting that the provisions concerning political cooperation do not 'affect Denmark's participation in Nordic cooperation in the sphere of foreign policy.'"95 Ireland's legal system is set up in such a way as to reinforce Irish sovereignty, so that even to become an EC

"de La Serre, "The Scope of National Adaption to the EPC," 208.

"ibid, fn 2, 209.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 8 6 member in 1973, the Irish Constitution had to be amended.96 Likewise, since the SEA officially recognized EPC for the first time, not surprisingly, an Irish citizen challenged the constitutionality of the SEA to Irish neutrality. This, in turn, held up the ratification process. Indeed, even the Court's judges were split over their interpretation of Irish neutrality and whether it was compatible with the SEA. As a result, another amendment was added to the Irish Constitution which enabled Ireland to ratify the SEA.97

The CFSP Regime through the Maastricht Treaty: Background In the SEA, reference was made for an IGC review in five years time.98 By early 1989, the IGCs began assessing progress towards the 1992 single market goal. Not unexpectedly, with the rapidly changing international environment of 1989-1992, and namely, the reunification of Germany, it became more manageable to develop dual track IGCs - one specifically on political union (EPU) and the other specifically on economic and monetary union (EMU).

’“Ne i l Collins and Frank McCann. Irish Politics Today. 2nd edn. New York: Manchester University Press, 1991, 88.

’’See: John Temple Lang's "The Irish Court Case Which Delayed the Single European Act," Common Market Law Review 24, no.4 (Winter 1987): 709-718; and J. Paul McCutcheon's "The Irish Supreme Court, European Political Co-operation and the Single European Act," Legal Issues of European Integration (1988:2): 93-100.

“Likewise, in the Maastricht Treaty, an IGC is scheduled to convene in 1996 for institutional review. At this time, it is expected that the enlargement to include Austria, Sweden, Norway and Finland (possibly Switzerland) will have occurred so that they can take part.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 8 7 Both would be a part of the so-called "European Union."99 Prior to the December 1991 Maastricht European Council Summit, Helen Wallace wrote an article which provided an evolving definition for the idea of "European Union," based on the developments within the IGCs. She noted that this Union would have three distinct pillars, thereby providing the flexibility needed for another enlargement: 1) the orthodox and consolidated Community pillar; 2) a common foreign and security policy pillar, connected to the Community but not subsumed in it; and 3) a third pillar dealing separately with internal order, reworking the Schengen model for a grouping of twelve.100 Ms. Wallace also suggested that by "[k]eeping the political economy integration of the Community distinct from the political and security collaboration of member-states [it] might allow scope for other countries to be engaged in some, but not all, pillars of integration within the Union."101 What was to result in Maastricht was not very far off the mark, and, in fact, enhances compatibility between European integration and European neutrality all the more since the

"similar to moat ideas within the EC, the "Treaty on European Union" is not a new idea. In 1979, with the first direct election for the European Parliament (EP), EP members felt a particularly strong responsibility to exercise their democratic rights. Led by well-known federalist Spinelli of Italy, the EP prepared what became known as the "Draft Treaty for European Union" in which a federal structure was designed to guide the EC toward its goal of European Union. Although the Draft Treaty received a high level of support in the EP, it was never ratified by the national legislatures and thus it never came into force.

,00He l e n Wallace. "The Europe that Came in From the Cold." International Affairs 67, no.4 (Oct. 1991), emphasis added.

101 Ibid.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 8 8 distinctions are even more clear by the three-pillar concept.

The Pre-Maastricht European Security Debate Although efforts were made during 1983-4 to reactivate the WEU as the collective European security platform, rather than exposing itself as a collective, the WEU quickly mirrored the EPC in its reassertion of national interests. Indeed, differing attitudes have developed within the WEU since its reactivation: [f]or some - namely the British, Germans and Dutch - the WEU should be developed as the 'European pillar' of the Atlantic Alliance, supplementing rather than replacing NATO. For others, such as the French, Italians and Spanish, it provides the nucleus of a more autonomous West European defense body, which should be closely associated with a more politically integrated Europe.102 Therefore, it was not surprising that given the rapidly changing international environment, and during the months leading up to the December 1991 Maastricht Summit, the debate over the EC's security policy escalated.103 On October 3, 1991 a U.S.-German initiative to include the

‘“indeed, with the end of the Cold War, the terms security and defense became further separated, with security being the broader of the two terms which includes defense policy as an aspect. Thus, security encompasses the "soft" elements of defense, such as policy formulation, confidence-building measures, and increased transparency. On the other hand, the defense refers to the "hard" and tangible elements of security and is the manifestation of policy, such as military hardware and enforcement.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 8 9 former Warsaw Pact members in a proposed North Atlantic Cooperation Council (NACC) was advanced by U.S. Secretary of State James Baker and German Foreign Minister Hans-Dietrich Genscher. Needless to say, the French were not pleased, and viewed the move as an effort to extend NATO's power.10* The next day, the British and the Italians coordinated an initiative to strengthen the role of the WEU in a dual capacity: "as the defense component of the Union and as the ... European pillar of the Alliance." The so-called Anglo- Italian initiative proposed the creation of an independent "European Reaction Force" (ERF) for NATO out-of-area contingencies, supplemented by a peacetime planning cell. However, in cases that fall under the purview of the NATO Washington Treaty, the ERF would defer immediately to NATO. Finally, there was also a proposal to move the WEU Secretariat to Brussels so that it could better coordinate with NATO and the EC. Portugal, Denmark and the Netherlands found this proposal to be particularly intriguing, given its strong Atlanticist links. Indeed, Italy's Foreign Minister De Michelis was pleased that he had convinced the United Kingdom to move this closely toward Europe on defense issues.105 In quick retaliation, France and Germany made it clear that they did not agree with the Italians on the "British concession" issue. The Foreign

l04Financial Times. October 9, 1991, 14.

IOiFBIS—WEP—91-216-A. 7 November 1992, 6.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 9 0 Ministers quickly drafted an "alternative” plan and submitted it to the then-President of the EC Council of Ministers, Mr. Ruud Lubbers. In the so-called Franco-German Initiative, they reaffirmed that the purpose in developing a political union is for Europe to develop and implement a common foreign and security policy which will eventually include common defense. More specifically, the initiative proposed an "organic link" between the European Union and the WEU, and encouraged current EC members which belonged to NATO to join the WEU as full members (Denmark and Greece) and offered observer status to the only non-NATO EC member, Ireland.106 In addition, the initiative proposed the creation of a WEU "planning group," without any distinction between NATO-area and out-of-area operations. It also recommended an expansion of the Franco-German brigade, to be the embryo of a potential Euro-corps that would include other WEU member states' troops.107 Lastly, the initiative specified certain areas in which joint action would be implemented, such as the CSCE process, and European arms control policy. Finally, from November 7-8, the NATO Rome

I06It was hoped that the three so-called "footnote countries" would be brought closer to the Europeanization instrument of the CFSP in this way.

,07Th e Eurocorps raises a few eyebrows over how its mission relates to the WEU and NATO. Belgium most recently joined the Eurocorps, making it the third member of this splinter organization that is allegedly under the purview of the Atlantic Alliance. The fact that a third European country joined two of the major powers reinforced the likelihood that it is legitimate as the embryo to a European defense component within the Atlantic Alliance. See: "Belgium to Participate in Franco-German Corps," FBIS-WEU-93-104. 2 June 1993, 2.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 9 1 Summit was held so that officials could complete the work of the "New Strategic Concept”. While it was expected that the major debate would be over the developing European defense identity, instead the focus of debate was on the prospects of NATO expanding its political role. This was largely because France did not want NATO to further expand its "sphere of influence" beyond the already-created NACC.108 Not surprisingly, after this meeting, the French-German connection believed their vision of European security had been endorsed, as did the Anglo-Italian connection. However, the British had serious reservations over the Franco-German initiative - especially a possible priority list for qualified majority voting and an outright reference to the European Union's role in defense. Rather, the British preferred to strengthen the WEU's out-of-area role and only allow the Union to have a role in shaping defense policy.109

The Maastricht Treaty A Federalist or Functionalist Victory? The Treaty on European Union was finalized during the European Council Maastricht Summit on 9-10 December 1991, and signed on 7 February 1992 after the consolidation and translation of the text. The summit represented one of the

*”FBIS-WEU-91-217. 8 November 1991, 3-5.

lwThe Manchester Guardian. November 8, 1991, 11.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 9 2 apogees, if not the ultimate peak, of Europhoria since the EUT embodied the accomplishments of the IGCs on EMU and EPC, and the text reflects the duality of this treaty.110 Not surprisingly, both the federalist and functionalist member states walked away from the summit under the impression each had "won." According to the "federalists" the treaty established the "embryo of a future European government: a single currency, common foreign and defence policy, a common citizenship and a parliament with teeth." Consistent with the neofunctional thought process, federalists believe it is only a matter of time "for history to take its course" in the form of a federal European Union. On the other hand, the pragmatic "functionalists" felt as if they had won. After all, the United Kingdom's Prime Minister, John Major secured several functionalist goals. For example, the "f" word of federal was taken out of European Union and in its place was "... 'an ever closer union among the peoples of Europe where decisions are taken as closely as possible to the citizens.'"111 Major also ensured that the European

“°There is a misperception that the EUT was an outgrowth of the SEA. Yet this does not tell the complete story, since the EUT is a reaffirmation and expansion of the original Treaty of Rome, and is a symbol of the entire European integration process. After all, it can be recalled that after the first direct election of the EC's European Parliament in 1979, the mission to complete a "Draft European Union Treaty" was undertaken and passed by the European Parliament in 1984. As such, the EUT must be seen in these broader terms, and not strictly as associated with the SEA. Whereas the SEA only addressed political union in Title III, half of the EUT is devoted to the development of the EPU. Indeed, some of the EUT draftees considered the EUT to be the replacement treaty to the original Treaty of Rome.

’""The Deal is Done," The Economist. December 14, 1991, 51-52.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 9 3 Union's two intergovernmental bodies, or '•pillars” on foreign policy and internal security would not meld into the EC and thereby ensured that the EC's two "supranational” institutions, the European Parliament and the Commission, would not interfere in these affairs. Voting Procedures Nevertheless, the French and German interests with the idea of common foreign policies was reflected in the EUT. While the prospects of majority voting in the CFSP were diluted by the requirement to first hold a vote which must be unanimous, a single member state could not veto the common action of the rest. In this respect (veto vs. opt- out) , the EUT has come a long way from the Luxembourg Compromise. As a result of the EUT, should member states unanimously concur to take a common policy, each member state is still secured the alternative to opt-out "in cases of imperative need." As stated: ... the Council of Ministers, having agreed unanimously on a common policy, may also decide, again unanimously, that certain measures needed to implement the policy should be taken by Qualified majority vote. On Britain's insistence, even once they have agreed on a common policy, countries will be allowed to act on their own 'in cases of imperative need.'"112

"2Ibid, 52, emphasis added.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 9 4 The CFSP and Defense As seen thus far, integration between similar countries is extremely demanding within the economic and foreign policy realms. Not surprising, then, defense integration between nations is even more difficult because "... assessments and perspectives diverge[] for reasons deeply rooted in different stakes, vulnerabilities and historical experiences."113 Therefore, although the Maastricht Treaty marks a significant step by its mere mentioning of defense, it logically follows that there are explicit (and implicit) limits placed on the level of the defense cooperation to be developed in the CFSP. One of the EUT's objectives is "the implementation of a common foreign and security policy including the eventual framing of a common defence policy, which might in time lead to a common defence." The wording of this objective is critical. It concurrently provides the inherent potential (should the political will exist), as well as the inherent limits of the CSFP. As such, the United Kingdom was quite successful at putting the prospects of "common defense" on indefinite hold both in policy formulation (note: "eventual") and actual defense (note: "might in time"). Moreover, Annex 5 of the EUT says that "[t]he WEU will be developed as the defense component of the European Union and as a way of reinforcing

,13Panayiotis Ifestos. Nuclear Strategy and European Security Dilemmas. Aldershot: Avebury Gower Pub. Co., Ltd, 1988, 348.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 9 5 the European pillar of the Atlantic Alliance."114 Thus, as a result of the Maastricht Treaty, the WEU has been systematically upgraded in its responsibilities and prestige.115 Indeed, with an "out-of-area" mission, the WEU theoretically has something the NATO alliance does not have. Despite the mission, however, the WEU lacks the projection power to act on any potential joint initiatives. Thus, NATO remains the "teeth" - or the implementor of both CSCE and WEU policies. Ratification of the Maastricht Treaty The Heads of Government left Maastricht confident that the EUT ratification process would be smooth and accomplished within the year, in time for the opening of the internal market on January 1, 1993.116 However, similar to the SEA ratification process, smooth sailing was not in store for the EUT. This time around, however, it was Denmark (again), France, the United Kingdom and Germany that slowed down the process. Ireland, on the other hand, did not have any problems and ratified the EUT quickly. This

'“Giovanni de Briganti and Theresa Hitchens. "France Gears up for full NATO Participation ... French Leaders Ponder Single European Nuclear Doctrine." Defense News (Oct 19-25, 1992), 8 and 12.

ll5For example, the WEU moved its offices from London to Brussels in a move to further "Europeanize" the Atlantic Alliance by bringing it closer to European institutions. The WEU has also allowed for associate and observer status. Greece joined as a full WEU member and Turkey joined with an associate status. Both Denmark and Ireland have observer status with the WEU. See: "European Countries Sign WEU Membership Accords," FBIS-WEU-92-226. 23 November 1992, 4.

II6Both Ireland and Denmark required a referendum for ratification, while the other members required parliamentary voting.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 9 6 only goes to show that other nations besides the neutrals have national prerogatives. Thus, it is not a "given" that the Euro-neutrals are going to be the "trouble makers" within the EUT. Even prior to the negative referendum in June 1992, Denmark appeared to be the biggest thorn in the side for the treaty since Denmark held a poll that revealed 48% of Danes polled oppose EC involvement in foreign policy as well as noting an overall hostility to a single currency. In the worst case scenario, had Denmark not ratified the Treaty, the Treaty would essentially become "null and void," and would require a renegotiation. In the meantime, Denmark would still be allowed to "... take part in the single market but to opt out of other areas such as foreign policy."117 Denmark's negative referendum seemed to set off a chain reaction of doubt throughout the EC. Between the Dane's vote and the December European Council Summit in Edinburgh, the ERM was drastically adjusted when the Germans refused to lower interest rates, the French held a referendum and almost said no, and the Swiss said no to the EEA. However, during the Edinburgh Summit (and perhaps because of all of the bad luck all year), Denmark was able to secure an opt-out, on among other things, part of the

l,7"Post-Maastricht Tension," The Economist. April 4, 1992, 64, emphasis added.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 9 7 CFSP. Specifically, the Danes were against a European defense structure. Yet, perhaps Denmark should be in the WEU so that it can help push the Atlantic element, with Britain and the Netherlands, all the more.118 After all, Denmark has stated that "'[t]he bottom line is that we in Denmark prefer an American finger on the nuclear button than a French one, or even a British one. We feel more secure with the Americans as the final guarantor of our defense.'"119 After the Edinburgh Summit, Sweden's Prime Minister, Carl Bildt commented on the Danish opt-outs: Denmark's success in achieving a separate agreement in Edinburgh ... helped pave the way for Sweden in the EC.... 'The Edinburgh agreement was very important. Partly because it happened at all, and partly because it showed that the idea that small states in the EC have no influence was wrong,'.... He also noted that Denmark has shown that an EC country does not need to be part of the European defense cooperation within the WEU. 'Our nonalignment remains'.120 This agreement paved the way for Denmark to hold a second referendum in May, during which the Danes said yes.

Compare/Contrast EPC with CFSP Even now that the EUT has been ratified, the intense debate over its ratification will have a long-lasting impact

ll8Theresa Hitchens "Denmark Seeks Maastricht OK Minus Defense Umbrella." Defense News (Oct. 26- Nov. 1, 1992), 17.

"’Theresa Hitchens "Danish Policy Refusal May Mar Unity." Defense News 8, no.3 (Jan. 25-31, 1993), 16.

ia)"Bildt Sees 'Dizzying' Potential in EC Membership,” FBIS-WBU-93- 042 March 5, 1993, 50.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 9 8 on the EC/EU since it exposed many vulnerabilities and points of contention. Arguably, Maastricht was an overall victory for the inter-governmentalists, just as had been the case for the SEA. Indeed, while Title I of the EUT clearly establishes a "European Union" (Article A) and states that the "Union shall be secured by a single institutional framework," the EUT has a separate Title V which establishes "A Common Foreign and Security Policy," and Title VI, which establishes "Provisions on Cooperation in the Fields of Justice and Home Affairs." In this way, the distinctions between "high" politics and "low" politics seem to be resurfacing, with the inter-governmental approach being reaffirmed in "high" politics, such as the CFSP, and supranationalism being concentrated on the "low" politics of economics/EMU. Indeed, in its inter-governmental nature, the EUT's CFSP is more similar to the Fouchet Plans121 of the 1960s than it is to the Genscher-Colombo Plan of the 1980s. It is only partially as ambitious as the Genscher-Colombo Plan had been in its attempt to amalgamate economics, politics and defense. Consequently, the CFSP pillar indicates an

121Soon after the 1961 Bonn Declaration, French President de Gaulle proposed a plan for political integration under the Fouchet Plans. The Fouchet Plans were cleverly designed by de Gaulle along the same lines as the EC, implying a supranational character, however, a clear intergovernmental character was reaffirmed throughout. These plans failed largely because Belgium and the Netherlands felt threatened by France's aspirations to reassert itself as the leader on the continent. However, the plans were essentially "shelved” on the archives of the EC's library, yet ultimately became the foundation of what the EUT's CFSP sets forth.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 1 9 9 awareness of the inherent difficulties of such a plan as that drafted by Genscher and Colombo. On October 9, 1992, Simon Lunn, Deputy Director of NATO's Parliamentary arm, the North Atlantic Assembly stated: "Maastricht doesn't make much difference to security and defense.... Security and defense are - and are likely to remain - intergovernmental issues."122 After all, the WEU is not formally linked with the EC, but is within the CFSP pillar of the EUT. As such, the CFSP is not much more advanced than the EPC. Although Maastricht provides a framework for setting the defense element into motion, the political will must exist on the side of the member states for the words to have any power. Thus, what lies in the Maastricht Treaty is simply a blueprint for achieving the goal, not the goal itself. Consequently, the implications of the Maastricht Treaty for the Euro-neutrals are these: it is designed to develop a common foreign and security policy (and thus, is focused on "soft" elements of cooperation), and it suggests that there may be an evolution to a common defense (and thus, "hard" elements are a possibility, once the soft elements have been achieved). However, can something that has yet to be developed (a CFSP which may include defense), truly present an obstacle to practicing neutrality? Only if

,22Theresa Hitchins. "EC Pushes Defense Policy." Defense News (Oct 12- 18, 1992), 1 and 90.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 20 0 a nation allows it to do so. Moreover, while the Maastricht Treaty mentions a CFSP that may potentially include defense, this defense element will not be included until after the 1996 review when the EC takes action on whether or not defense is to be included within the legal framework of the EC's decisionmaking. By 1996, the Euro-neutra1s plan to already be members of the EC and EUT. Therefore they will have a direct input on how the defense element is to develop. Of further note is that the WEU Secretary General, Willem van Eekelen, made overtures towards the EFTA nations/Euro-neutraIs which are conducting membership negotiations with the EC. He stated: '[a]ccording to the Maastricht Treaty, the WEU is intended as the future defense organization of the European Union. Thus, it is only logical for us to set up links with future EC members.'130 Of particular interest to the Euro-neutrals would be that "[a]n opt-out clause from military operations already existed for the current WEU members” ,131

,3#"WEU Head Supports Relations with EFTA States," FBIS-WEP-93-012. 21 January 1993, 3.

l3lLahodynsky, 28.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 0 1 The Compatibility of European Neutrality and European Political Cooperation: Selected Policies and Actions The compatibility of European neutrality with European political cooperation can best be ascertained by analyzing what has taken place within the realm of EPC policies and actions to date. By highlighting EC member state obligations undertaken through various EPC policies and actions, it quickly becomes apparent that the state-dominant nature of the EPC and its inherent flexibility is the reason why neutrality is reconcilable not only with the current EPC framework, but also with the CFSP framework. Moreover, by specifically noting Ireland's experience in reconciling its neutrality within the EPC framework during select EPC actions, a better assessment can be reached in what the Euro-neutrals can anticipate with their eventual memberships in the EU. However, it also becomes apparent that not only Ireland, but other EC members have reasserted their respective national interests and chose to refrain from various EPC actions during the course of its existence. Thus, similar to the other EC members, Ireland's approach to the EPC has been on a case-by-case basis. Consequently, refraining from EPC actions is something not exclusive to Ireland by nature of its neutrality; rather, such refraining permeates the EPC's history, given its inter-governmental

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 202 nature. Finally, it is important to note the EC's positions through the EPC broadly reflect the general west European position, to include the Euro-neutrals. When it comes to taking 'European' positions on a number of issues in world politics, many inside and outside the Community see the European group as effectively including Norway and some of the neutral states - as can be seen by the former's desire to be associated with EPC, and the way the neutrals have worked well with the EC in the [CSCE]. At times, indeed, the EC's distinctive positions will appear blurred even further by overlaps with general 'western' postures, in which separate caucuses like that of the EPC can be an obstacle as much as a source of leadership.132 Thus, simply because the EC has its own institution in which to discuss foreign policy issues (via the EPC and now the EU's CFSP), this does not necessarily provide a given that the conclusions at which the member states arrive are in any way unique, especially when the decisions are often made at the lowest common denominator formulation. This is illustrated more clearly below by observing how Austria and Sweden reacted during the same situations, and how their respective neutrality policies remained intact with responses similar to that of the EPC. Indeed, [i]t should be said that, as to substance, Sweden [and Austria] could have consented to most, if not all, words and deeds resulting from the EPC work so far [through 1989]. In the case of voting in the United Nations, Sweden [and Austria] more often than not support[s] the same positions as the other Western European states. The communality of values and

,32Christopher Kill, "Research into EPC: Tasks for the Future," in European Political Cooperation in the 1980s. 211-228: 223.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 0 3 interests is such that the exceptions are few.133 It is helpful to approach an analysis of EPC actions by dividing primary areas of concern by geography and by policy. This discussion includes the EPC's policy in the Middle East, Central America, South Africa, and during the East-West conflict.134 In turn, the positions of Austria and Sweden are examined in certain instances to reaffirm the compatibility of neutrality with the political cooperation of the EC member states.

EPC Middle East Policy During the early 1970s, the EPC agreed to develop a dialogue at the expert level with the major Arab states, referred to as the Euro-Arab dialogue. Largely in response to the oil crisis, the EC wanted to secure its economic interests. Moreover, it wanted to strike up a political dialogue so that it could become more involved in the Middle East peace process. In January 1975, when Ireland held the rotating EC Council of Ministers for the first time, the so-

,33Sverker Astrom, "Swedish Neutrality: Credibility through Commitment and Consistency," in The Committed Neutral: Sweden*s Foreign Policy, ed. Bengt Sundelius, 15-34, Boulder, CO: Westview Press, 1989.

,34The EPC also deals with such broader issues as human rights and international terrorism, which are not discussed here. However, these are two areas in which the Euro-neutrals have similar concerns as the EC members, so these areas of coverage within multilateral groups, such as the UN, and CSCE, will not infringe on their respective brands of neutrality.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 0 4 called Dublin Formula proposed participation of the Palestinian Liberation Organization (PLO) in the Middle East peace process. This proposal eventually found its way into the EPC's 1980 Venice Declaration.135 During the 1980 Venice European Council Summit, the EPC presented a declaration on its position in the Middle East. Among other things, the Venice Declaration essentially stated that all peoples should have self- determination (both Israelis and Palestinians alike), and all should be allowed to be a part of the peace process.136 Thus, the EPC's policy toward the Middle East was the first major area where a collective EPC position137 can be discerned as distinct from the U.S. position.138 Similarly, under Chancellor Bruno Kreisky, Austria formally recognized the PLO as the "... legitimate representative of the Palestinian people and [c]ertain diplomatic privileges and immunities were conferred on PLO representatives in

,35Patrick Keatinge. "The Europeanisation of Irish Foreign Policy," in Ireland and the European Community. 33-57, ed. P.J. Drudy and Dermot McAleese, Cambridge University Press, 1983: 46.

l3eThe EPC did not, however, endorse an independent state for Palestine, since it assumed this issue would be resolved as a part of the negotiations.

,37Yet even within the "unified front" of the EC, various national interests differed amongst the EC member states.

13*However, the European efforts were not necessarily liked by the Israelis. For example, Israel Foreign Minister Shamir commented that "The European declarations contribute nothing to peace and stability in the region." See: I.Greilsammer and J.Weiler's Europe's Middle East Dilemma. Boulder CO: Westview Press, 1987, 91.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 0 5 Austria...," yet this did not infringe on its neutrality policy.139 Such an oscillation from the U.S. position in the Middle East made Western Europe more visible internationally as an actor in the Middle East political process. However, it readily became clear that the Venice Declaration only covered one of the many problem areas of the region, as the revolution in Iran, the Gulf War(s), and the Lebanon problem indicated.

Sanctions on Iran Many of the EFC's foreign policy actions have been economic in nature through the imposition of sanctions.140 During the 1979 Iranian hostage crisis, while the EPC member states initially responded in a unified position to apply sanctions via the EC's Article 224 of the Treaty of Rome, in which member states give effect to common action through national legislation, more specific national interests began to take priority. For example, both France and Britain began to have second thoughts about applying the sanctions. Indeed, by the time the limited sanctions were ready to be implemented, the hostages were being released. Such

l39Hanspeter Neuhold, "The Permanent Neutrality of Austria: Austrian Neutrality on the North-South Axis," in Neutrality and Non-Alignment in Europe. ed. Karl E. Birnbaum and H. Neuhold, 81-91. Laxenburg, Austria: Wilhelm Braumuller, 1982.

‘"’While EPC makes the political decision to apply sanctions, the EC Council of Ministers assembles the sanctions package under the EC's common commercial policy.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 0 6 "changing gears" in mid-stream proves to be even more harmful than not attempting to formulate a common position because it undermines any unity that might have existed in the first place. This only reaffirms the reactive nature of the EPC's diplomacy.141 Although Austria diplomatically condemned Iran's actions, it, like some of the EPC members, chose not to impose economic sanctions.142 The 1990-1991 Gulf Crisis On August 2, 1990, Iraq invaded Kuwait in an effort to gain access to valuable oil supplies. The EPC responded almost immediately to Iraq's blatant aggression and disregard for international law and the inviolability of borders by condemning Iraq's actions and imposing an oil and military sales embargo under the EC's Article 113 on August 4, 1990, prior to the adoption of more extensive sanctions by the UN Security Council. The EPC followed-up these sanctions by providing emergency aid to those nations indirectly affected by the sanctions, to include Egypt, Jordan and Turkey. Moreover, the EPC took diplomatic action by expelling Iraqi military attaches and monitoring Iraqi embassies in member states. By October, the EPC actions

,4lChristopher Hill. "Changing Gear in Political Co-Operation," in The Political Quarterly. 53, no.l (Jan-Mar 82): 47-60, 48.

lcNeuhold, "The Permanent Neutrality of Austria: Austrian Neutrality on the North-South Axis." In Neutrality and Non-Alignment in Europe, ed. Karl E. Birnbaum and H. Neuhold, 81-91. Laxenburg, Austria: Wilhelm Braumuller, 1982, 89-90.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 0 7 were supplemented by activity within the WEU to assist in enforcing the embargo by providing ships to monitor adherence to the embargo. However, the WEU's involvement during the crisis was bound to lead to additional complications affiliated with the post Cold War role of NATO in an out-of-area conflict. Indeed, this conflict exposed prevalent national distinctions both within the WEU and the EPC. Not surprisingly, France was at the helm of independent action, as removed from not only NATO, but also the WEU itself. Although the EPC's actions were extremely impressive during the first phase of the conflict, and marked a significant improvement in reaction time from the Soviet invasion of Afghanistan, EPC activity that followed was more in line to its traditional "reactive diplomacy," albeit to a lesser degree. Nevertheless, the EPC's perpetuation of "reactive diplomacy" during the Gulf Crisis should not have come as a surprise, least of all to the EPC members, since by design the EPC allows for diversions free a collective position. As William Cromwell notes, "... the limited nature of the EC's collective role ... was in part a result of the restraints on unified action imposed on the regime of political co-operation by member-states themselves.1,143

,<3Cromwell, "Europe, the United States, and the Pre-War Gulf Crisis," 148.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 0 8 Indeed, the very barrier the EPC was trying to overcome - reactive diplomacy - was still the obstacle which kept it from accomplishing the member state's professed goals of common action. However, this is intrinsic to the fundamental design of the inter-governmental process. Cromwell proceeds to consider the ramifications of such self-imposed restrictions to political cooperation as he concludes: [u]nless the EC and/or the WEU can agree to alter their existing state-dominant multilateral regimes in the interest of achieving a more cohesive and coherent single voice, defence and political co-operation will remain an often fragmented and erratic expression of European unity whose success may depend largely on situational opportunities or pressures to forge common positions.144 Austria's actions during the Gulf War crisis were similar to the actions undertaken by the EPC, and condoned by the UN, which reaffirmed Austria's commitment to international security. For example, just eleven days after Iraq's invasion of Kuwait, Austria had imposed full economic sanctions called for by the Security Council of the UN. Moreover, Austria allowed flights enroute to the Gulf to transit its territory. Yet such actions were in line with the UN Charter's Chapter VII on "threats to peace". As such, Austria's actions were in line with collective security and therefore did not require Austria to "activate"

I44Ibid, 150.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 0 9 its neutrality, but rather cooperate in UN-approved actions. "This behavior was commended by EC officials."145

EPC Latin America Policy When Argentina invaded the Falkland Islands in 1982, the EPC was compelled to take action, not least of all because this was aggression toward a fellow EC member - the United Kingdom. In April 1982, the EC-Ten issued a joint statement condemning Argentina's action and requesting that it withdraw its forces and adhere to the UN Security Council's appeal to seek a diplomatic solution to the problem. The EPC called on application of UN Resolution 502, and imposed economic sanctions by banning all arms exports and military equipment to Argentina, as well as on all new imports from Argentina to the EC. This was accepted by the EC Council of Ministers.146 However, one month later when the sanctions were up for renewal, the situation began to take on a more political level when Britain decided to

l<5Paul Luif, "Austrian Neutrality and the Europe of 1992," in Austria in the New Europe, ed. Gunter Bischof and Anton Pelinka, 19-41, Contemporary Austrian Studies, Volume 1, London: Transaction Publishers, 1993.

‘^Sanctions were imposed via Article 113 of the Treaty of Rome rather than Article 224, as had been the case during the 1979 Iranian hostage crisis. This distinction is important since in the case of Article 113, sanctions are applied on a "community level" through the common commercial policy, while in the case of Article 224, sanctions become more within the purview of the member states since national legislatures would have to approve common action. These sanctions, however, did not include current orders between Argentina and EC member states, which reduced their economic impact significantly.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 210 take military action. As a result, various EC members began to splinter off from the application of sanctions for their respective "national interest" reasons. This action landed Ireland, Italy and Denmark with the name of "footnote nations." While Italy and Ireland altogether stopped applying the sanctions (Italy for reasons of its ethnic connections to Argentina, and Ireland for reasons of its neutrality), Denmark chose to apply sanctions under a different Article in the Treaty of Rome (224 instead of 113) .147 By late June the sanctions were repealed with the break-up in hostilities. Indeed, [t]he fact that EPC texts in the 1980s have included 'footnotes' from one or more governments explaining individual positions could also be seen as a positive sign: the increasingly advanced character of EPC naturally impinges more often and more directly on (and collides with) specific foreign policy interests of the member states. 48 Therefore, this crisis placed nations other than "neutral" Ireland on the outside of the EC's common interest.149 This reveals that flexibility is an inherent part of the EPC political cooperation process. As had been the case during

1<7Keatinge. "The Europeanisation of Irish Foreign Policy," 54-56.

,48Elfriede Regelsberger, "EPC in the 1980s: Reaching Another Plateau?" in European Political Cooperation in the 1980s. 3-48: 23-24.

I49lndeed, although Ireland has often been referred to as the reason why the EPC has not taken more serious measures in security policy, the bottom line is that "Ireland has served as an alibi of the partners to avoid dealing squarely with the security issue." See: Joseph Weiler and Wolfgang Wessels "EPC and the Challenge of Theory," in European Political Cooperation in the 1980s. 229-258: 256.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 11 the application of sanctions during the Iranian hostage situation, all members concurred at the outset in a spirit of solidarity, but then splintered off as the situation began to escalate and infringe on various national interests.150

EPC South Africa Policy In light of the decolonization process, when the EC was established in 1957, it remained on relatively good terms with former colonies in Africa and established preferential trade agreements with Africa under the Lome and Yaounde Conventions. With the United Kingdom's accession to the EC in 1973, South Africa's policy of apartheid became a concern for all EC members. The EPC soon began to commit itself to promoting democracy and equality for all in South Africa. For example, the formerly bilateral 1974 Code of Practice between the United Kingdom and South Africa became the foundation of the 1977 EC "Code of Conduct" for EC companies operating in South Africa, designed to ensure that they lead the way in abolishing apartheid in the workplace and improving social conditions for black workers. By 1985 when a State of Emergency was declared by the South African Government, the EC decided to impose sanctions in response

li0For a thorough discussion of this crisis see: Geoffrey Edwards' "Europe and the Falkland Islands Crisis," in Journal of Common Market Studies. 4 (1984): 295-313.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 212 to an Increase in violence and repression throughout South Africa. In turn, the EC sent assistance to organizations in South Africa which were attempting to combat apartheid. Nevertheless, as Martin Holland argues, the EPC's South Africa policy also served to illustrate "... the value of [the] domestic politics approach for understanding the limitations imposed upon EPC by national diversity."151 Early-on Sweden developed a policy toward South Africa similar to that of the EC/EPC. For example, in response to South Africa's policy of apartheid, Sweden prohibited Swedish companies to make investments in South Africa. Moreover, by 1986, Sweden prohibited all trade between South Africa and Sweden. Sweden viewed the situation in South Africa as a "threat to peace" under Chapter VII of the UN Charter because of blatant humanitarian violations. Therefore Sweden's actions were part of a larger collective security action which did not infringe on Sweden's policy of neutrality since sanctions were authorized by the UN Security Council.152

Martin Holland, "Three Approaches for Understanding European Political Co-operation: A Case-Study of EC-South African Policy," in Journal of Common Market Studies 25, no.4 (June 1987): 295-314: 304. For example, in July 1985, after the EC had issued a joint declaration on South Africa in response to the State of Emergency, France unilaterally recalled its Ambassador to Paris, causing the others to follow its example six days later in an attempt to display EPC diplomatic unity, even though British and German trade interests in South Africa were substantial.

,52&str6m. "Swedish Neutrality: Credibility through Commitment and Consistency," 22-23.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 1 3

EPC East-West Policy The CSCE The CSCE was essentially the ground-breaker for the EPC since the negotiations preceding the 1975 Helsinki Final Act coincided with the development of EPC. Born out of the spirit of detente, the CSCE proved to be a particularly important tool for all thirty-five members. Despite the CSCE's efforts for a pan-European approach during the Cold War, it was inevitable that three groups would emerge within the forum: members of the Atlantic Alliance, members of the Warsaw Pact alliance, and those nations which belonged to neither group, the so-called neutral and non-aligned nations (NNAs) .153 Since the CSCE process was the only security forum in which the NNAs were allowed to participate, it made its utility all the more important and presented the NNAs with a reason to cooperate which existed at no other time. As the former Austrian Minister for Foreign Affairs, Peter Jankowitsch noted "[t]he neutral and nonaligned countries have as much at stake in the success of [arms reduction] negotiations ... as the allied states. They did not cause the risks of the present situation but fully share them. It

,sOf note is that Ireland was required to be grouped with the EPC rather than the NNA group, by virtue of its EC membership. Nevertheless, Ireland did not consider this to be an infringement on its neutrality, especially since the positions between the two groups were practically identical.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 1 4 is only logical that they should also have a strong interest in sharing in the efforts to diminish these risks."154 While the essentially bilateral mutual balanced force reduction (MBFR) and strategic arms limitation talks (SALT) primarily involved the issues of military "hardware" the multilateral Helsinki process cultivated the "software" aspects of military security (being the confidence building measures (CBHs) of the Helsinki process), and in this way, the NNAs were first able to have some impact on the general state of security in Europe. Jankowitsch refers to the arms control issues of the MBFR forum and the CBMs of the CSCE forum as the "twin pillars" of a future security regime in Europe.155 While the original CBMs of the 1975 Helsinki Document were limited in scope, they were easily used as a "springboard" for the further development in 1983 with the establishment of the Madrid Mandate which called for a conference entirely devoted to elaborating the Helsinki CBMs into confidence- and security-building measures (CSBMs). This is discussed further below. It logically follows that over the course of the CSCE conferences, an additional goal emerged for the NNAs. This

,54Peter Jankowitsch, "The CSCE and the Future of Confidence-Building in Europe," in Confidence-Building Measures and International Security, ed. R.B. Byers, F. Stephen Larrabee and Allen Lynch, East-West Monograph Series, no. 4 (New York: Institute for East-West Security Studies, 1987), 69.

I55Ibid, 77-78.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 1 5 goal was to simply perpetuate the process in order to ensure the group's collective security interests were included in the overall scheme of European security matters. With this driving urge to continue the process, it was inevitable for the NNA group to evolve in its role as mediator when the East-West situation was not favorable and it appeared as if this would jeopardize the completion of the follow-up sessions. Clearly, during the Cold War, the NNAs had the most to gain from the continuation of the CSCE process in order to be included in European security matters and the most to lose if the CSCE process collapsed on account of hostilities between the bipolar world. Indeed, the NNA group proved to be instrumental in preserving the CSCE process during the 1979-1980 escalation in hostilities between the superpowers after the Soviet invasion of Afghanistan and the Polish crisis. Soviet Invasion of Afghanistan Quickly disrupting the spirit of detente of the early and mid 1970s, the Soviet Union invaded Afghanistan in late 1979. In January 1980, the EC foreign ministers met in Brussels in order to decide how to respond and the Nine agreed to declare the invasion as a massive violation of the UN Charter, and sent aid to the Afghan people. However, not only was the EPC slow to condemn the Soviet invasion because it did not want to see the detente atmosphere come to an

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 1 6 end, but because of Western Europe's close trade links with the Soviet Union, the EPC was hesitant to apply sanctions, as the U.S. immediately did. However, EPC decided not to replace U.S. goods. Nevertheless, the EPC encouraged the Soviets to withdraw their troops from Afghanistan.Moreover, in February 1980, a proposal for neutralizing Afghanistan was tabled by the United Kingdom.156 The possibility of boycotting the Moscow Olympics was also raised. However, in the end, only the FRG boycotted the Moscow Olympics. Consequently, "[e]fforts at collective European action were often compromised by internal EC differences."157 Polish Crisis In response to the imposition of martial law in Poland, the EC Foreign Ministers met in January 1982 and presented a 12-point statement on their "utter disapproval" of the situation and condemned it by stating it violated the principles of the Helsinki Final Act. Moreover, the EPC provided direct humanitarian aid to the Polish people and announced consultations on the sanctions decided by the U.S. The resulting package consisted of an imposition of restrictions on some Soviet luxury goods in 1982; however, these restrictions were not accepted by Greece.

IS6During his term as the EC President of the Council of Ministers, Lord Carrington of the United Kingdom visited Moscow in 1981 with the Ten's proposal for a neutralized Afghanistan.

1S7William C. Cromwell, The United States and the European Pillar: The Strained Alliance. London: Macmillan Publishers, 1992, 110.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 1 7 Contributions of the NNA Group Indeed, had it not been for the mediatory efforts of the NNA group during the 1980 Madrid Conference, the Helsinki process would likely have been deadlocked between the super powers, and the ramifications of such a deadlock could have proven to be detrimental to Europe. Furthermore, the NNA group was instrumental in further developing the Helsinki document's CBMs by upgrading the status of such "soft" defense policy attributes as transparency and verification measures to the CSBMs of the Stockholm Conference in 1986-1987. While similar to CBMs, CSBMs include more specific measures which, as described by the Mandate, are to be of "... military significance and politically binding and will be provided with adequate forms of verification which correspond to their content."158 The three year Stockholm Conference significantly expanded the role for the CSCE in security matters and more clearly obligated the member states to adhere to the amended security provisions.159 With the hindsight and the tainted implementation of the Helsinki CBMs, it became clear that more tangible and

158Jan Sizoo and Rudolf Th. Jurrjens, CSCE Decision-Making; the Madrid Experience. (Boston, MA: Martinus Nijhoff Publishers, 1984), 302.

lwFor an extensive discussion of the Stockholm Conference see, for example, John Borawski's From the Atlantic to the Orals: Negotiating Arms Control at the Stockholm Conference (New York: Pergamon-Brassey's International Defense Publishers), 1988.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 18 specific guidelines would be required if security in Europe was to increase to any significant degree. Therefore, such all-encompassing and vague phrases as "whenever possible" and "if applicable" needed to be revised in the phraseology of the existing Helsinki CBHs. Notification measures needed to be more detailed. Observation requirements needed to be more equitable. Annual calendars of projected activity needed to be established in order to commit member states to alert the others of its plans more effectively. Stringent verification measures were needed to ensure compliance with the agreed upon principles. Above and beyond these issues, the NNAs (especially Yugoslavia and Sweden)160 and the East advocated a new kind of CBM: constraints that would actually place limitations on activities and ceilings on the troop levels taking part in military maneuvers. Indeed the idea of enforcing constraints and limits was new and revolutionary, but not entirely unexpected. The goal of these revised CBMs was to decrease the possibility of surprise attack and to increase the level of confidence and security in Europe. Had it not been for the work of the NNA group, the issue of security in the CSCE would not have grown to the level it has today, and the CSCE process would not have survived the "times of troubles" between the East and the

l<0Carl C. Krehbiel. Confidence- and Security-Building Measures in Europe: The Stockholm Conference. New York: Praeger Publishers, 1989, 219.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 1 9 West. The NNA group clearly played a significant role in Europe during the Cold War and largely because of its contributions and persistence, the progress of the CSCE and the advancement of security in Europe was enhanced. Moreover, such collective action on behalf of the NNAs proved not to be incompatible with retaining neutrality during the Cold War. Ironically, however, with the passage of the Cold War the reasons for the NNA group's cooperation may not be as apparent with the decline of one superpower and the collapse of a bipolar confrontational atmosphere. Nevertheless, the lessons learned by the NNAs during the CSCE experience will prove to be useful in the formation of the new European security architecture. It can therefore be reasonably argued that, during the Cold War, the most significant group within the CSCE was the NNA group. Its cooperation proved to be the glue to the CSCE process. After all, it was in the whole of Europe's interest to maintain the status-quo and preserve detente for as long as possible. Consequently, the great powers have much to draw from the diplomacy and prudence displayed by the NNA group during the Cold War and should attempt to apply such tactics during the post-CoId War era.

Concluding Assessments Although the list continues concerning various EPC

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 220 foreign policy practices since the early 1970s, the consistent pattern reveals that EPC's collective policy making tends to be held hostage time and again by the various internal whims of the member states. As such, the "EPC has neither become a substitute for managing Community affairs nor a substitute for national affairs. But it has enlarged the ways of solving problems in addition to both Community and national procedures.1,161 Without a doubt, much discussion occurs within the EPC, and the very process of engaging in discussions in such a communal environment fosters mutual awareness, and sometimes, mutual understanding. However, much of what the EPC is about is strictly consultations through "group therapy" and not necessarily action. This will likely remain the case for the CFSP of the EU. Indeed, "[t]he States have ... encouraged the belief among outsiders that the EC is becoming a genuine 'international actor' while remaining secure in their own minds that nothing of substance has been conceded to supra-nationality.”m Consequently, the reality of the state-dominant nature of the EPC, as well as in its CFSP follow-on, makes practicing neutrality in tandem with the goals of collective diplomacy and common action

“'A.Pijpers, E.Regelsberger and W.Vessels, "A Common Foreign Policy for Western Europe?" in European Political Cooperation in the 1980s. 259- 273: 269.

162Hill, "Changing Gear in Political Co-Operation," 50.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 21 possible, no natter how threatening the ultimate aims of the European Union seem. Moreover, reflecting on the positions of Austria and Sweden during the same circumstances reveal that similar broad positions were reached by nearly all West European states. Consequently, the neutrality of Austria and Sweden is compatible with the political cooperation of the EPC and the CFSP. This is not surprising since after all, "... political attitudes relate not to the ultimate political state of the European Community [and European Union] but to the overall negotiating strategies employed by individual Member States in pursuit of their national interests. " ,63

lfi3Keatinge, "Europeanisation of Irish Foreign Policy," 42, emphasis added.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. CHAPTER IV

THE FUTURE OF EUROPEAN NEUTRALITY AND INTEGRATION

Diplomacy is the art of avoiding the appearance of victory. Metternich, 1815 Redefining Neutrality Has neutrality become anachronistic? Since '• [n]eutrality is not only an aim per se but also a means of keeping independence and sovereignty,"1 the answer must be no. The concept of neutrality has been adapting to changed circumstances for several hundreds of years and will adapt to today's changed circumstances. For certain small states it will remain a salient tool for the preservation of sovereignty and national identity. In many ways, therefore, neutrality, like the nation-state, is "obstinate rather than obsolete."2 Part of the reason a small nation would choose to remain neutral is to allow it more control over its independence than it would otherwise be permitted to have

'Schwok, 67.

2See: Stanley Hoffmann's "Obstinate or Obsolete? The Fate of the Nation-State in Western Europe," in International Regionalism.ed. Joseph S. Nye, 177-230 (Boston: Little, Brown & Co.), 1968; and Curt Gasteyger's "Swiss Neutrality: Obsolete or Obstinate? - The Challenge of the Future," in Swiss Neutrality and Security: Armed Forces. National Defence and Foreign Policy, ed. Marko Milivojevic and Pierre Maurer, 175-193 (New York: St. Martin's Press), 1990.

222

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 2 3 in a pool of great powers. Concurrently, however, with growing interdependence, the costs of economic marginalization have grown substantially. Thus, the major change for the Euro-neutrals since the end of the Cold War is that their primary preoccupations have been reversed.3 For example, during the Cold War, the Euro-neutrals necessarily focused on security and defense issues such as the arms race, since at any given time, they could be pulled into an armed conflict. After the Cold War, the prospects of large-scale war diminished, while the prospects of more inter-state and intra-state wars have replaced that likelihood. On the other hand, during the Cold War, the Euro-neutrals were relatively comfortable in their respective economic arrangements with the EC through the EFTA. However, after the Cold War, the Euro-neutrals' economic positions have been affected (as the rest of the world has been affected) by the world recession, and the EFTA, the prospective EEA, and the EC/EU have become the primary points of focus for the economic well-being of the Euro-neutrals. Nevertheless, despite the changed circumstances, it is not an "either-or" situation regarding the preservation of neutrality, nor will it be for the foreseeable future. If anything, the price of surrendering neutrality in today's

^euhold, "An Austrian View," 230-231.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 2 4 rapidly changing Europe is too high and the risks of isolation are too low.4 However, the Euro-neutrals must recognize that they ”... cannot afford to remain indifferent to what amounts to a far-reaching restructuring of postwar Europe. The time has come to qualify neutrality in order to make it compatible with European integration."5 "Qualifying" neutrality is much closer to "redefining" neutrality, rather than abandoning it. History has shown that the more events occur to disrupt the European vision of integration, the more insecure the EC becomes and the more coercive it becomes on its demands toward potential new members. Given the course of events during 1992, the EC's visions were tempered by reality, but in turn, this made the EC highly defensive and insecure. Moreover, a huge piece of humble pie was dished out to the EC during the Edinburgh summit when "... the EC accommodated Denmark [by securing opt-outs] on the Maastricht Treaty."6 Quite understandably, the EC is concerned about the potential precedent such flexibility might set and fears this type of flexibility can be

4Gasteyger, 204.

5Jurg Martin Gabriel, "Switzerland and Economic Sanctions: The Dilemma of a Neutral." In Swiss Neutrality and Security. 232-245, emphasis added.

“"Memoradum on Denmark and the European Community: The Maastricht Treaty on European Union," Royal Danish Embassy, Washington, D.C., December 1992.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 2 5 considered as weakness and a dilution of the European Union goal. In reality, however, accommodation to Denmark was the best route the EC could have taken and revealed that the EC is coming to grips with its diverse membership, which will only grow with additional enlargements. Thus, during the EC/EU membership negotiations, the Euro-neutrals will be able to commit to the principles of the CFSP, since it is

p r i m a r i l y security-related and has yet to be developed. It would be naive of the EC to assume that a verbal concession would be all that it takes to have a country "change its ways". Neutrality is such a large part of each of these country's political culture that they will likely continue it either implicitly or explicitly, as both the Irish and Danish cases fully reveal. The goal of the Euro-neutrals currently negotiating with the EC is to secure the likelihood of full membership by January 1, 1995, so that by 1996, when the IGC is scheduled to further develop the CFSP, they will be able to participate as full members in the "fleshing out" of that policy. It is highly unlikely that by saying yes to CFSP, they will be saying no to neutrality; the issue is simply not that clear cut.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 2 6 Austria Although Austria's neutrality was a result of the Cold War, a large portion of the Austrian population is hesitant to give up neutrality after the Cold War. Interestingly, during the Cold War, many Austrians began to attach great affinity to neutrality as a source of national identity, and this has been passed through the generations. As such, most Austrians would rather adapt their nation's neutrality than give up what they consider to be a fundamental element of their national identity that has served them well for several decades. The Austrian government understands this, and since it views neutrality as a means and not an end, it is easier to allow the concept to continue in its evolution than it is to strip away something that the population holds so dear in its national identity; thus there is an irrational factor at play regarding the concept of neutrality, not only in Austria, but in all of the Euro- neutral states, as well as Ireland. Austria's EC Membership Application Austria's 1989 application for EC membership incorporated a neutrality reservation. The Austrian government sought "... to secure a certain leeway so that [Austria] can continue [its] policy of neutrality."7 Indeed, Austria was prudent to incorporate such a

7FBIS-WEP-89-195. 11 October 1989, 1.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 2 7 reservation since at the time of application, the Soviet Union was still very much in existence and would likely feel threatened if Austria had placed the bid without it. Above and beyond the concerns of the Soviet Union, however, was the fact that Austria, out of the four Euro-neutrals was the first to apply for EC membership. While the other three had the way paved for them by Austria, Austria was stepping out on a limb and testing the waters. Given the importance of neutrality's credibility factor, especially during the Cold War, it would have appeared inconsistent for Austria to have not requested this reservation in its EC application. Indeed, by incorporating the neutrality reservation, Austria was negotiating from a maximalist approach, once again, a very judicious move. In this way, a genuine compromise could be reached with the EC. Had Austria not mentioned neutrality in its application, it may have become a foregone conclusion to the EC that Austria no longer wanted to retain its neutrality. Nevertheless, Belgian Foreign Minister Mark Esykens took it upon himself to suggest that the EC should meet with the Soviet Union to discuss the implications of Austria's bid for EC membership - without Austria's participation. Needless, to say, Austria took great offense at Belgium's gesture. With the fall of the Berlin Wall three months later, however, such a meeting never occurred.®

*Lahodynsky, 26.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 2 8 However, this did not appease Hr. Esykens' suspicions, as he interrogated Sweden when it placed its bid for EC membership two years later. By May 1990, Austrian Chancellor Vranitzky "... stressed the flexibility of Austrian neutrality.... [by stating] 'neutrality is compatible with the cooperation process of the EC.'"9 Later that year, one of the EC's Vice Presidents, who is currently in charge of EC External Affairs (Trade), Germany's Martin Bangemann, also raised a few remarks to Austria regarding its neutrality reservation. Mr. Bangemann stated: I personally regret that Austria pointed out in its application for EC membership that it will continue to observe its commitment to neutrality as before.10 He also suggested that Austria should ask itself the following question: "[h]ow do we have to define our neutrality so that it first corresponds to the commitments we undertake as a new member of the Community and, second, that it is useful within the framework of the European security system."11 The following month, the Austrian government endorsed the objective of EC political union, including the security dimension; however, Foreign Minister

’"Vranitzky Says Neutrality 'Compatible' With EC," FBIS-WED-90-095. 16 May 1990, 1, emphasis added.

,0"EC Vice President on Membership, Neutrality." FBIS-WEU-90-210. 30 October 1990, 4-5.

"ibid.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 2 9 Mock stated that "... I do not believe that there will ever be a European defense community or a European federal army. "12 The EC's Report on Austria/s Membership Application By August 1, 1991, the EC Commission responded to Austria's EC application by stating: [t]he EC will generally benefit from Austria's membership. Austria would enlarge the circle of those countries that, as a result of their economic, monetary, and budgetary capacity, are able to make economic and monetary union progress quickly.13 However, the Commission also noted that Austria's neutrality ... causes problems for both the EC and for Austria itself. On the one hand, there is the question of whether permanent neutrality is compatible with the provisions of the existing treaties. On the other, the development of the negotiations within the framework of the government conference on Political Union would have to lead the EC to request clear promises by the Austrian authorities regarding their legal ability to accept those obligations that arise from the future foreign policy and common security policy.14 In response to the EC's avis, Austria accepted the obligations inherent in EC membership and Austrian Foreign Minister Alois Mock greeted the opportunity to "'be a partner with equal rights and full codetermination'." Vranitzky stated that "Austria is not becoming an EC member simply to seek economic advantages. 'We realize very clearly

12"New Government Will Endorse EC Political Union," FBIS-WEU-90-221. 15 November 1990, 2.

,3"EC Application Report," FBIS-WEU-91-148. 1 August 1991, 2.

I4Ibid.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 3 0 the EC's significance for peace and security in Europe and for all future developments on this continent. Austria wants to participate in particular in this peace-making role of the EC'."15 Mock also stated that he foresees Austria's ability to participate in EC peacekeeping forces without any problems: [i]f it is possible to participate in peacekeeping activities within the framework of the worldwide collective security system of the United Nations, we can also do that in a collective system of European security, be it within the framework of the CSCE or, later, of the EC.... Nor is it necessary to formulate neutrality in a new way.16 Indeed, with this statement, Mock implies that since Austria has had extensive experience with collective security in the UN, Austria will be able to bring the advantages of its experience in the UN to the new European security framework as laid out in the CFSP. Moreover, if neutrality was compatible with UN membership during the Cold War, then neutrality will be consistent with the CFSP envisioned under the Maastricht Treaty since in the post-CoId War era, the CFSP will likely be adopting some of the UN's procedures on a regional basis. Moreover, the Chancellor commented on the

ls"Treaty Obligations Accepted," FBIS-WEU-91-148. 1 August 1991, 2- 3, emphasis added.

’‘"Comment on EC Reservations,” FBIS-WEa-91-150. 5 August 1991, 3-4.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 3 1 resilience of neutrality, despite the end of the Cold War: ' [i] t is true that [Austria's neutrality] was born on the soil of the East-West conflict, but it is not necessarily concentrated on it forever. For there can also be other armed conflicts where one has good reason to keep out of them.17 Clearly, there was mutual interest as well as steadfastness on the parts of both Austria and the EC regarding Austria's potential EC membership. As Austria saw it, however, it was in a position to be a tough negotiator since the EC had much to gain from its membership. Austria was determined to secure its special interests, one of which was maintaining neutrality.18 Austria's Reaction to the Maastricht Treaty Austrian officials greeted the Maastricht Treaty, insisting that it presented no new problems for Austrian membership, even in the defense dimension. Indeed, Foreign Minister Alois Mock stressed that "[f]or the EC to make the WEU a pillar of its defense policy means that things will become easier for a neutral country because the WEU is an organization outside the EC.1,19 Nevertheless, it is explicit within the EUT that the WEU is designated to respond to requests on behalf of the EU on defense matters.

17"Vranitzky on EC Reservations, European Army," FBIS-WEU-91-150. August 5, 1991, 2-3.

l8"Mock: Reevaluation of Neutrality 'Not Necessary'," FBIS-WEU-91- 150. 5 August 1991, 3.

l9FBIS-WEU91-239. December 12, 1991, 1, emphasis added.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 3 2 Mock was particularly pleased with the three-pillar approach to the European Union, which placed the inter-governmental CFSP pillar along side, and not part of, the supranational EC pillar. Although the WEU is designed to be the organization which will respond to requests of the EU on defense matters, there is no current demand that the Euro- neutrals join the WEU. After all, "'[n]onalignment is possible for the neutral states in the sense that there is no demand that they join the WEU, which is expected to develop into the EC's defense force.'"20 Clearly this is the issue of concern for the Euro-neutrals, thus, de factorially, the Euro-neutrals will be able to get what they want, at least as regards security issues, especially if they cooperate and let the EC know that they have certain requirements which must also be met before becoming full EC/EU members. In March 1992, Chancellor Vranitzky "... very cautiously hinted that in a future collective security system, neutrality might prove to be 'superfluous and obsolete.' But for the time being, this issue is not on the agenda."21 The importance of this statement lies in the precondition of an existing collective security arrangement

2d"EC's Van den Broek on Cooperation With New Members," FBIS-WEU 93- 020. 2 February 1993, 4-5, emphasis added.

21"Vranitzky Hints Neutrality Might be 'Obsolete'," FBIS-WEU-92-042. 3 March 1992, 4, emphasis added.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 3 3 which could guarantee Austrian security. Until that point of time arrives, however, Austria will cling to its neutrality. This was most recently reaffirmed when Foreign Minister Mock stated that "[b]efore one thing is fully available, I have no reason to give up the other, particularly since it is compatible with EC membership."22 In July 1992, Austria's newest President, Thomas Kleistil took office. Chancellor Vranitzky was quick to point out the distinctions between collective security and collective defense: N/A system of collective security, such as the future European security system, should not be confused with a military alliance.'"23 Indeed, for these reasons, Austria considers its neutrality to be consistent with the goals of the EPC/CFSP. Austria's EC Membership Negotiations On January 27, 1993, just prior to the start of EC membership negotiations, EC Commissioner Mr. Hans Van den Broek stated that he hoped that the EFTA countries would be able to participate in the CSFP (as observers, and therefore without a vote), as the negotiations proceed. He also stipulated that "[m]embership negotiations will be about European union and not about the EC as it is today."24

22,1 Mock: Neutrality Compatible With EC Membership," FBIS-WEU-93-216. 10 November 1993, 11.

^Lahodynsky, 25, emphasis added.

“"EC's Van den Broek on Cooperation," 4.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 3 4 Somehow it is not surprising for the EC to negotiate on something that does not yet exist, especially when it is feeling vulnerable and insecure. Yet at the same time, Van den Broek readily acknowledges that WEU membership will not be a "requirement."25 Vranitzky was quoted to have said "...'a certain harmonization'" is likely to occur between at least Austria and Sweden during membership negotiations.26 It would be wise for such collaboration to occur, especially given the Director General for Foreign Policy Relations of the EC Commission Guenter Burghardt's latest comments toward Austria regarding its neutrality. Essentially, "[he] ... does not see any chance for the future of Austrian neutrality [and commented that] one must 'marry the bride as she is,'" referencing the EC's so-called "finalite politique" as the ultimate guideline.27 However, the fact remains that European Union is still a goal, and not yet a reality, so it is easy to pay lip-service to such a goal, especially if, in the process, a nation is securing an opportunity to co-determine how that goal is to be developed, as the Euro-neutrals plan to do during the 1996 IGC. EC membership negotiations officially began with

aIbid.

^"Vranitzky on EC Reservations," 2-3.

^"EC Official Sees No Chance for Austrian Neutrality," FBIS-WEU-93- 107. 7 June 1993, 2.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 3 5 opening statements to the EC Commission on February l, 1993 from Austria, Sweden and Finland. In the opening statement, Foreign Minister Mock reflected on the importance of diversity in Europe: [t]he Community's founding fathers conceived integration as a means to achieve unity, not uniformity. A new European identity will have to take account of the history, culture and traditions of the different peoples and will have to complement, not replace the manifold existing identities.28 Particularly humorous is a Financial Times article written the day after negotiations opened whose title says it all: "New Applicants To Give Up the Neutrality Habit."29 Such a statement indicates a blatant lack of understanding of what neutrality is and what the neutrals intend on doing with their policies of neutrality. Indeed, less than a week prior to the start of the negotiations, Austrian Foreign Minister Mock reaffirmed Austria's support for retaining its neutrality status.30 Moreover, at the opening of negotiations, the Swedish Minister for Europe, Ulf Dinkelspiel, stressed that Swedish non-alliance will still

“"Declaration by the Federal Minister for Foreign Affairs Dr. Alois Mock on the Occasion of the Opening of Accession Negotiations with the European Community, February 1st, 1993." The Embassy of Austria, Washington, D.C., 1993., 13, emphasis added.

“David Gardner "New Applicants To Give Up The Neutrality Habit," Financial Times (February 2, 1993), 2.

“"Mock Reaffirms Support for Neutrality Status," FBIS-WEU 93-017. 28 January 1993, 3.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 3 6 remain.31 In addition, Finnish delegates let the Commission know that Finland "... would insist on an independent defense and military nonalliance."32 It's hard to imagine that the Austrian, Swedish and Finnish Governments changed their positions overnight. However, given that neutrality is such an "arcane and esoteric"33 issue it is understandable that the layman, in this case David Gardner, would consider neutrality to be "dropped." However, it is not as black and white as this article implies. Although neatly-packaged answers are always tempting to believe, since they leave no room for further inquiry, they are not realistic - especially in the case of the concept of neutrality. The existence of neutrality cannot be so neatly wrapped up in yes/no formulas. For example, the article implies that since all three applicants support the ideals of the CFSP, they are therefore "giving up the habit of neutrality." In actuality, however, saying that a nation is committed to the ideals of the EUT which may include a common defense is not the same as dropping neutrality. After all, as the EUT incrementally specifies, the EUT must first achieve a regional security formula before it can get

31 "Sweden Presents 'Demands' to European Community," FBIS-WEU 93- 020. 2 February 1993, 5.

“"EC Talks' Agenda, Negotiating Team Outlined," FBIS-WEU 93-017. 28 January 1993, 30.

K e n n e d y and Specht, 409.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 3 7 to the collective defense formula. Thus, the on-going negotiations primarily involve the three nations joining the EC, only one of the three pillars of the European Union. It is likely that many of the issues to be discussed during the negotiations will be the issues left unresolved within the EEA Treaty. Not unexpectedly, most recent polls indicate that ”[i]f the European Union were not to agree to neutrality, 48 percent of those asked said they would not want to join, while 34 percent said that neutrality should be amended, and another 8 percent were of the opinion that neutrality should be given up."34 Needless to say, both the Austrian Government has its work cut out for it in convincing the populace to say yes during the referendum, as does the EC/EU in reconciling the compatibility of neutrality with its integration goals. Sequence of Entry Prior to confirmation at the Edinburgh summit that EC negotiations would begin in February between the EC and all willing EFTA countries, there was a widely-held assumption that sequentially, Austria would be the "first" to be let in to the EC since it was the "first" to apply of the EFTA members in July 1989. However, this assumption defied all logic of the EC's past negotiating strategies. As has been

^"Fifty Percent Against EC If Neutrality To Be Given Up," FBIS-WEU- 93-227. 29 November 1993, 6.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 3 8 noted, Finland and Sweden started negotiations concurrently with the EC on February 1, 1993. Given the pattern of accessions of the EC in 1973 and 1986, it is more probable that the fourth EC enlargement (first EU enlargement) will occur on January 1, 1995 with all willing EFTA members. Although negotiations are held in a bilateral fashion between the Commission and each nation that applies, this enlargement differs from the last insofar as the common thread of neutrality is concerned. Indeed, to allow in states one-by-one would serve to reaffirm the uniqueness of each acceding member whereas to lump them together minimizes this. Coordination will thus become a major task. It will be necessary to make sure that in the short to medium term the various organizations and institutions subscribe to common European ground rules and strategies. Instead of harmful rivalry, a reasonable division of labour should be sought. On the other hand, 'political Darwinism' can be predicted to be at work, so that only the politically and institutionally fittest will survive in the long run.35 Ultimately, however, the organization which is being pursued is the organization which can make or break a deal. It was stated back in 1972 that: "[i]t can be argued that ultimately a decision on admitting new members is more concerned with the national policies of existing members than with the external policy of the Community.1,36 This is

^Neuhold, "An Austrian View," 231.

*Henig, 144-145.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 3 9 certainly as relevant today. In fact, the EC decided that each applicant must deal bilaterally with the Community, although possibly at an advanced stage and for particular items two or more negotiations might be joined together.37

Sweden The true art of adaption can be seen in Sweden's tradition of neutrality. Sweden has retained neutrality as a foreign policy tool for about two centuries, and there is still no pressing reason for it to give it up, or to stop redefining it now in today's changed circumstances. Prior to WWII it was a rather passive stance; after WWII it became more active and concentrated on reaffirming the armed aspect of neutrality through military self-reliance and dissuasion. In February 1991, Swedish Foreign Minister Andersson visited Brussels and announced that Sweden would apply for EC membership that summer. He discussed Swedish membership with no other than Belgian Foreign Minister Mark Eyskens, one of the most zealous proponents of a federal EC. Not surprisingly, as he had been in the case of Austria, Mr. Eyskens was very curious about Sweden's neutrality policy and argued that "if we create a Europe in which all antagonisms between East and West have disappeared, there is no longer any need for neutrality." Mr. Andersson simply

’’ibid, 33.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 4 0 responded with "[y]ou can become a member with your neutrality intact .... There is nothing that has been said or written which makes Swedish membership impossible."38 Sweden's EC Membership Application Prior to submitting its EC application, an internal discussion occurred between the Swedish Government and Parliament.39 Indeed, "... both the committee report preceding the parliamentary decision in December 1990 and the Government's statement to Parliament in June 1991, immediately before the formal application, expressed the assumption that Sweden could continue this policy as an EC member."40 Therefore, just as the Austrian Declaration of Neutrality could not be understood in a vacuum, disregarding what occurred prior to it in the form of the Moscow Memorandum and the State Treaty, the Swedish membership application cannot be viewed so narrowly either. It is a matter of reading between the lines ... by not spelling it out so specifically, Sweden would have more room for maneuver. But in this respect, Sweden has always been able to be more flexible in its approach to neutrality policy

^"Issue of Country's Neutrality Within EC Discussed," FBIS-WSU-91- 031. 14 February 1991, 26-27.

*The Swedish Government had announced on October 26, 1990, that it would ask Parliament to concur with a Swedish EC membership application. Parliament approved this statement on December 12, 1990.

4DWahlback "Swedish Security in a Changing Europe," 1, emphasis added.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 4 1 than Austria, which had to follow the "rules" a little more closely. Thus, while Austria specifically included a neutrality reservation, Sweden (nor Finland, nor Switzerland for that matter) even mention the term neutrality. This is not because each does not want to retain it with EC/EU membership, but because of Austria's ground-breaker, it is implicit that neutrality will be retained. In other words, it is not even up for discussion since it is a given precondition. For example, approximately one year prior to Sweden's EC application, Social Democratic Prime Minister Ingvar Carlsson stated: ... the future of our neutrality policy is quite clear: We have no reason to change our course. Everyone must know and everyone must be able to depend on the knowledge that Sweden will be neutral if a war should break out ... 41 The Social Democratic Party was particularly cautious over compromising Sweden's neutrality status by applying for EC membership. However, one year later, on 1 July 1991, Sweden did apply for membership under the Social Democrats, after serious economic problems and growing public support. Of interest is that although the major conflict between political parties in Sweden rested on the neutrality issue as concerns EC membership application, opposition leader Carl Bildt, who is now Sweden's Conservative Prime Minister

4,"Carlsson Presents Views," FBIS-WEU-90-119. 20 June 1990, 39, emphasis added.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 4 2 (since October 1991) echoed the importance of Swedish neutrality and stated: [i]t is ... important to realize that the all-European security system which must now be established will become a complement to existing national and collective security arrangements, but will never fully replace them."... "the hard core of the neutrality policy retains its importance as the ultimate Swedish security policy even in a far more peaceful, far freer and far more open Europe than of today.42 Indeed, this sounds very similar to the statements Austrian Foreign Minister Mock made one year later in reference to neutrality's resilience beyond the confines of the Cold War as a response to the EC's avis. In April 1991, Foreign Minister Sten Andersson indicated that "Sweden's neutrality would not be a problem"43 with full EC membership. However, Swedish Armed Forces Chief General Bengt Gustafsson stated that "[i]n the midst of all these uncertainty factors... one should not turn one's back on neutrality. 'We should wait and see whether neutrality is still a means to an end.'" 44 EC's Report on Swedish Membership Application During the month of August 1991, two events occurred of significance to Sweden: the attempted Soviet coup failed and the EC Commission formally responded to Sweden's

c"Bildt Attacks Carlsson's EC, Neutrality Views," FBIS-WEU-90-188. 27 September 1990, 25-27, emphasis added.

^"Swedish Foreign Minister Views EC Membership," FBIS-WEP-91-072. 15 April 1991, 1.

44"Armed Forces Head on Baltic Events, Neutrality," FBIS-WEU-91-065. 4 April 1991, 49-50.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 4 3 membership application. With the failure of the Soviet coup, Sweden felt a bit more at ease. Although some newspapers reported that Sweden would abolish its neutrality,45 in September 1991, the new Prime Minister Carl Bildt took office and after the EC Commission's avis, Mr. Bildt promised to keep the policy of neutrality.46 EC Commission Vice President Frans Andriessen stated that "'Sweden will no longer be able to lay claim to its traditional neutrality'.... 'But a different view is now being taken of the concept of neutrality, and it does not have to be an insurmountable obstacle.'"47 Moreover, the Commission will be looking for "'specific and binding assurances' from Sweden regarding the CFSP. In response,

4S"World Wire: EC Pushes Entry by Sweden." Wall Street Journal (August 3, 1992), A13-14.

^Craig Whitney, "Swedish Coalition Plans Overhaul of Policies." New York Times (October 6, 1991) 1, 11:1, emphasis added.

^"EC Recommends Sweden Be Accepted as Member," FBIS-WEU-92-150 4 August 1992, 2.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 4 4 Prime Minister Carl Bildt stated: [w]e see no difficulties for Swedish involvement in EC security and foreign policy as far as ve know it today.... As far as defense policy is concerned, the EC repeats the phrases from Maastricht about a possible common defense policy. 'But we are not there yet,' Bildt replied. 'People inside the EC do not themselves know what they want. We Swedes, therefore, cannot reach a decision on something that does not exist as yet./4S Ulf Lindell, Second Secretary at the Swedish Embassy in Washington D.C. echoed this essential point during a personal interview: "... some issues have not been settled within the existing Community of twelve, and we as yet not being members, cannot be asked to have a definite policy on issues that the twelve have not made a final decision on either."49 Indeed, it is precarious to negotiate on speculation. Sweden's Reaction to the Maastricht Treaty In a speech to Parliament in January 1992, Mr. Bildt "... confirmed that in view of present strategic realities in Northern Europe the 'hard core' of Sweden's security policy would still be non-participation in military alliances. This included the obligation to maintain an adequate independent defence capability to enable Sweden to remain neutral in the event of war in our immediate

^"Reaction to EC's Statement on Membership," FBIS-WEU-92-151. 5 August 1992, 43, emphasis added.

*Ulf Lindell, Second Secretary at the Swedish Embassy, Washington D.C., personal interview by author, February 1993.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 4 5 vicinity. 'Sweden is not defended by anyone else', he added, 'and Swedish defence is for Sweden only.' He also stressed, however, that we do not know what the future may hold and that there is no reason for Sweden to close any doors as regards the future."50 Indeed, Sweden is simply keeping all of its options open so that it can secure the option to say no. Incorporation of WEU into CFSP will not be discussed until the 1996 IGC. At that point, Sweden intends to be an EC member, and at that point it can decide whether or not it wants to become a full member of the WEU. However, in the meantime, WEU Secretary General van Eeklen has indicated that the EFTA countries wanting to join the EC should be able to establish closer relationship with the WEU even before accession. Sweden's EC Membership Negotiations On February 1, 1993, Swedish European Affairs Minister, Ulf Dinkelspiel, presented the opening statement of Sweden's accession negotiations with the EC. Early in

^Wahlback, "Swedish Security in a Changing Europe," 1-2, emphasis added.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 4 6 the statement, Dinkelspiel specifically declared that: [w]e wish to participate in the construction of a new European security order on the basis of the UN Charter, the principles and decisions of the CSCE and other relevant principles of international law. To this end we wish to participate fully in the Common Foreign and Security Policy (CFSP) within the framework of the Union.51 Clearly, Sweden places the universal collective security experience of the UN and somewhat regional collective security experience of the CSCE as the fundamental overarching framework of any collective security system that is to develop in Europe. In addition, the principles of openness and transparency were well-received by Sweden, as well as the principle of subsidiarity. Moreover, he was certain to point out that Sweden's defense practices had not changed, but would not affect the development of the Union: Sweden's policy of non-participation in military alliances remains unchanged. At the same time we recognize that the eventual framing of a common defence policy, which in time might lead to a common defence, is one of the CFSP goals which is to be further discussed in the context of the 1996 review conference. We will not hamper the development of the European Union as it moves towards this goal.52

51"Statement by Mr. Ulf Dinkelspiel, Minister for European Affairs and Foreign Trade, at the opening of Sweden's Accession Negotiations, 1 February 1993" Ministry for Foreign Affairs, The Royal Embassy of Sweden, Washington, D.C., 1993, 5, emphasis added.

aIbid, 6, emphasis added.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 4 7 Finally, Dinkelspiel made reference to Nordic cooperation: [t]he long-standing tradition of cooperation between the Nordic countries will no doubt also be an asset for our future partners in an enlarged Community. We wish to see this cooperation recognized in an appropriate form in the accession treaty.53 Indeed, later in the year, he reaffirmed that although the idea of a Nordic Union is resurging, it "... can only be realized from the aspect of real-politik within the framework of the EC. It is not an alternative to EC membership."54 Nevertheless, it also provides a "security blanket" should EC/EU membership not work out as expected. However, Dinkelspiel is perfectly aware of the EFTA's strong negotiating position when he reaffirms EFTA's importance and emphasizes the necessity to allow for Central European integration with the west as quickly as possible. In order to do this, Dinkelspiel suggests that the more quickly the EFTA and EC get their integration resolved, both with the EEA and EC membership, the more quickly they will be able to assist the east. After all, " __ membership for the EFTA countries represents a strengthening of the EC," and he clarified that M/... in round terms' Sweden would pay 20 billion kronor a year to the EC and get back 10 billion

“ ibid.

^"Dinkelspiel Attacks EC Unresponsiveness, SDP Waffling," FBIS-WEU- 93-176. 14 September 1993, 57.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 4 8 kronor."55 Nevertheless, as Carlsson most recently warned "... membership should not come about at any price."56

Finland Finland/s somewhat asymmetrical neutrality, elaborated in the Finnish-Soviet Treaty of Friendship, Cooperation and Mutual Assistance of 1948, was formally brought to a close in 1990.57 While the Finnish Center Party government advocated a moderate approach to the EC during 1991-1992, the European recession and lack of progress on the EEA, and loss of its major trading partner, the Soviet Union, encouraged Finland to apply for membership so that it would not miss the opportunity to join when the other EFTA members joined.58 Finland's EC Membership Application One month prior to Finland's application for EC membership, the Finnish government had a debate over the future of Finnish neutrality. While the Center Party under Prime Minister Esko Aho and Foreign Minister Paavo Vayrynen

“"Dinkelspiel on EC Membership, Related Issues," FBIS-WEU-93-107. 7 June 1993, 49.

“"Carlsson: Rapid EC Membership 'Not a Goal in Itself'," FBIS-WEU- 93-229. 1 December 1993, 42.

^"Papers on Poll Showing Majority Back EC," FBIS-WEU-90-220. 14 November 1990, 32.

“"Rapid Moves Toward EC Membership Ruled Out," FBIS-WEU-91-116. 17 June 1991, 27.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 4 9 would like to retain the term neutrality, the Conservative Party and the Finnish People's Party want to "... relegate the whole word neutrality to history and speak of nonalliance.... [since] neutrality as a concept is in 'an intellectual crisis'".59 Finland formally applied for EC membership in March 1992, and like Sweden, did not mention neutrality in its letter of application. Of particular interest is that when asked during an interview why Finland did not mention neutrality in its EC application, Finnish Foreign Minister Paavo Vayrynen responded: [p]artly because of the experience that Austria has had with its application. We were told that the fact that neutrality was expressly mentioned in the Austrian application has complicated the matter.60 Indeed, Austria had essentially served as the "ground- breaker" for EC negotiations on the issue of neutrality - since Austria explicitly mentioned it, the others could implicitly rely on neutrality's resilience in conjunction with EC membership. Indeed, Vayrynen was quick to point out that although Finland, like Sweden, chose not to expressly mention neutrality, this did not mean that they were willing

’’"Cabinet Talks on 'Neutrality'," FBIS-WEQ-92-044. 5 March 1992, 24.

®"Vayrynen Interviewed on Neutrality, NATO Ties,” FBIS-WEU-92-061. 30 March 1992, 27, emphasis added.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 5 0 to forego it: [w]e have never hidden our intention to maintain our neutrality. That means for Finland that the essence of our neutrality can be characterized by two elements. We do not belong to any military alliance, and we have an independent defense system. 1 The EC Commission responded rather quickly, and favorably to the Finnish application on November 4, 1992. Once again, as was the case of Sweden, newspapers reported that Finland would be dropping its neutrality.62 However, this was far from the truth. Finland/s EC Membership Negotiations Finland's Foreign Trade Minister, Mr. Pertti Salolainen, presented the opening statement to the EC. He stated: [s]ecurity and the ability to hold our own in difficult times have ... been important to us. However, Finland has never wanted to isolate itself. On the contrary, we are convinced that only open- minded co-operation and interchange can create real security.... In these negotiations, we will defend our own views and pursue our own interests just as others do.63 Finland foresees agricultural and regional policies, not the CFSP, to be the most sticky areas to resolve within the

“ ibid.

®"Top EC Body Backs Talks with Finland," Boston Globe (November 5, 1992), 2:6.

“"Statement by Mr. Pertti Salolainen, Minister for Foreign Trade of Finland," The Ministerial Meeting Opening the Conferences on the Accession of Austria, Sweden and Finland to the European Union, Brussels, 1 February 1993, The Embassy of Finland, Washington, D.C., 1993, 1-2.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 5 1 negotiations with the EC. Finland does not expect to introduce any new aspects in the security policy; it will simply reaffirm its commitment to the principles of the EUT's CFSP. Simultaneously, Finland did let the Commission know that it "... would insist on an independent defense and military nonalliance."64 At the Foreign Ministry they feel that specific assessments of its position on European union will scarcely be demanded of Finland since some EC countries have not vet accepted the Maastricht treaty and Denmark rejected it in its national referendum. In its report on Finland, the EC Commission proposed that the member countries could ask Finland for guarantees that it will politically commit itself to a common European defense. As the Foreign Ministry interprets this, it is the EC's way of saying that nothing will be required of Finland, nor will Finland be required to prepare for military action.65 During a personal interview with Second Secretary Mr. Ari Heikkinen of the Finnish Embassy, I asked whether he thought the EC was being too black and white about this issue. He replied: [a] year ago the EC was very clear and said that neutrals could not be accepted as full EC members, but nowadays they have readjusted their position - mostly because of changes in Russia. It is easier for the EC to let these front-line countries defend themselves. This makes our lives much easier in the negotiations.66

“"EC Talks' Agenda, Negotiating Team Outlined," FBIS-WEU 93-017. 28 January 1993, 30.

“ibid, emphasis added.

“Ari Heikkinen, Second Secretary at the Finnish Embassy. Interview by author, 4 February 1993, Washington D.C. Tape recording. Embassy of Finland, Washington, D.C.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 5 2 Thus, not only will the EC be receiving funds from the EFTA Euro-neutrals as net contributors to the EC budget, but the EC will also be saving money by not having to worry about their defensive capabilities. Further reflection of Finland's evolving neutrality is that it joined the North Atlantic Cooperation Council (NACC) as an observer, the organization established to bridge the West with the East given the security vacuum left from the demise of the Warsaw Pact. Moreover, in a display of independence, Finland purchased U.S.-made F/A-18 fighters over the Soviet-made MiG-29 and the Swedish-made JAS-39 Gripen in May 1992.67

Switzerland While there are claims that the EC suffers from a democratic deficit, it can also be said that in Switzerland there is a "democratic surplus."68 Indeed, Switzerland exemplifies federalism, neutrality and independence. It is the most obstinate of all Euro-neutrals and it considers itself to be the source of these enduring principles. As J.J. de Dardal, Political Counsellor at the Swiss Embassy

^Theresa Hitchins "Scandinavia Pursues New Bridge to West." Defense News (Jan. 25-31, 1993), 8.

“Desmond Dinan. Professor at the George Mason University. Interview by author, 10 February 1993, Arlington, VA. Tape recording. The George Mason University, International Institutes, Arlington, VA.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 5 3 put it during a personal interview: [t]he Swiss are most concerned with matters of principle, and they vote more along principle lines than on economic lines. The reason for this is because we have to attribute more to things that others take for granted, such as national identity. It is difficult to define what the Swiss are unless you refer to our political system and our political idiosyncracies.69 Indeed, when asked about neutrality, Mr. de Dardal replied: "[the Swiss] believe they invented neutrality."70 Moreover, [i]t is ... clear that the idea of abandoning neutrality is still anathema to many, if not the majority of Swiss citizens.... It will not and cannot give up its neutrality merely for the sake of a remote prospect of European political integration. Nor can it give it up more than once: neutrality, in the Swiss view, in order to remain credible, is not something that can be 'hired and fired' according to rapidly changing circumstances and opportunities. Neutrality once lost cannot easily be recuperated. So if Swiss neutrality has to be redefined or even abandoned as a price for Switzerland's membership in the EC, this will only be done if and when European economic and political integration has advanced to the stage of irreversibility and leaves no other promising option open. The prospect of this happening in the foreseeable future is still considered remote.71 By October 1991, the Swiss Federal Council had come to accept not only the EEA but full membership in the EC: Swiss President Rene Felber stated: "The option of joining [the EC] is no longer an option, but a goal of Swiss foreign

WJ.J. de Dardal, Political Counsellor at the Swiss Embassy. Interview by author, 2 February 1993, Washington, D.C. Tape recording. Embassy of Switzerland, Washington, D.C.

w Ibid.

^Gasteyger, 203, emphasis added.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 254 policy. m72 Switzerland's EC Membership Application May 1992 was quite a month for Switzerland. Known to be a staunch isolationist, the Swiss people signaled their desire to "join the world" by voting positively in a referendum on becoming a member of the World Bank and International Monetary Fund on May 17, 1992.73 A day later, the Swiss Government filed an application with the EC for full membership, hoping that the Swiss people would provide a similar positive feedback come the referendum. The Government's primary fear is that if it does not join the EC as a full member, and remains outside of the economic integration of Europe, it will lose its competitive edge.74 Although long the proponent of a "third way", the Swiss government has come to realize that this is only a form of marginalization from the EC. Although once appearing to be a perfect solution, this third way, originally embodied in the EEA, results in negative long-term results for Switzerland - having to obey the rules but not being able to contribute directly to the decision-making. With the difficulties of negotiating the EEA, and with Switzerland's

^FBIS-WSO—91—204. October 22, 1991, p.27.

^"Swiss Approve Joining IMF and World Bank." Washington Post (May 18, 1992), A13.

MAlan Riding, "Dropping Isolation, Swiss Seek to Enter Europe's Institutions," New York Times. May 19, 1992, Al.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 5 5 switch from being its most adamant supporter to its most adamant opponent, it is clear that Switzerland, out of all the neutrals, will be the most difficult case to square with the newly emergent Europe.

Swiss Referendum on the EEA In a December 6, 1992, national referendum, Swiss voters rejected their government's proposal for joining the EEA.75 There was much debate within Switzerland over the vote and an internal rift between those wanting to eventually join EC and those seeking to maintain the country's neutrality.76 One week later, the Danes secured their opt-outs from the EUT during the Edinburgh Summit. Indeed, had the two events been switched in time, the Swiss vote might have turned out positively. In Switzerland, however, there is much more than simply neutrality that is keeping it from joining the EC - it's the very nature of its federal system and its direct democracy that it does not want threatened by integration. Although the referendum was specifically on the EEA and technically not on the EC, the message from the people was the same. As Mr. de Dardal put

^one Tempest "Swiss Reject Bid to Join Europe Trade Bloc," Los Anaeles Times. December 7, 1992, A14.

76Rone Tempest "'No' to Europe Leaves Two Swiss Towns on Opposite Sides of Internal Frontier." Los Anaeles Times (December 8, 1992), A4:l.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 5 6 it: [t]he Swiss don't see the need for pooling. This is why we resented so much the idea that we should link forces with other EFTA partners to negotiate with the EC or to have a seat at a multilateral working group on this subject.77 Few countries can enjoy the luxury of principle, but even this is changing for Switzerland. As a result of the negative referendum on the EEA, Switzerland will now try to optimize its bilateral relationship with the EC through its existing FTA, and circumvent the EEA.

Ireland as a Model for the Euro-neutrals Ireland does, in fact, serve as a viable model of practicing neutrality within the EC, despite the EC's deeper integration goals. Although some scholars, like Trevor Salmon, would dismiss the validity of the Irish model to the Euro-neutrals looking to gain EC membership, since Ireland has been, as he calls it, "unneutral," other scholars, such as Patrik Keatinge and Bill McSweeney, find some utility in learning from the Irish model. Indeed, Ireland is the only model of an EC member that retains a professed neutrality policy, which reaffirms that neutrality can still be

^J.J. de Dardal. Political Counsellor at the Swiss Embassy. Interview by author, 2 February 1993, Washington, D.C. Tape recording. Embassy of Switzerland, Washington, D.C.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 5 7 practiced in an increasingly interdependent world.78 Primarily because of the inter-governmental nature of the EPC, Ireland's neutrality has, thus far, not been compromised, nor is it expected to be compromised by the EU's CFSP. Moreover, given the background on the development of neutrality in the cases of Austria and Sweden, the validity of the Irish model can admittedly only go so far. While it is rare, if at all, that any of the four Euro-neutrals consider Ireland's brand of neutrality to be similar to their own, especially during the Cold War, Ireland's experience of being the only professed neutral within the EC does serve some utility. Thus, rather than dismissing a potential model, it is essential to draw on Ireland's experiences, limited though they may be. During a personal interview I asked Professor Desmond Dinan of the George Mason University whether Ireland served as a valid model for

1®Keatinge, "Neutrality and Regional Integration: Ireland's Experience in the European Community," 79-80.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 258 the Euro-neutrals. He responded: [t]he only model Ireland provides [to the Euro- neutrals] is that it legitimizes EC membership. Any nation which is serious about neutrality would not compare itself to Ireland. If Ireland was a true neutral in the sense of the others, it could not be in the EC. All of the others evaluated the situation and stayed out. Ireland joined. How can it claim to be neutral?79 In response, I stated that Ireland was in the worst shape economically, so it was not in the same position as the other Euro-neutrals. Ireland was in a position where it needed the EC more quickly than the others did - economics was the primary motivator for Ireland then, as it is now for the Euro-neutrals preparing for EC membership. In this way, Ireland simply preceded the others by twenty years. Moreover, the fact that Ireland "legitimizes EC membership" is reason enough for the Euro-neutrals to want to draw some parallels during their ensuing negotiations with the EC. In comparing the experience of the Euro-neutrals to Ireland Professor Keatinge explains that: [a]s long as they are relatively strong economies, they can afford to bargain from the outside and thereby maintain the essence of their neutrality norms. With a relatively weak economy, Ireland has necessarily had a different approach. Just the fact that Ireland has necessarily had to take a different approach than the others, however, does not

’’Professor Desmond Dinan, Director of European Studies, George Mason University, personal interview by author, February 1993.

®Keatinge, "Neutrality and Regional Integration: Ireland's Experience in the European Community," 79-80.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 5 9 invalidate its practice of neutrality. Indeed, by joining the EC, Ireland was better able to be recognized as an independent state, separate from the United Kingdom. This was particularly important to Ireland, since it was clearly dependent on Britain economically prior to its EC membership. Thus, it was a politically prudent move by Ireland to join the EC when it did. "It allows Ireland to make a more significant impact on world developments than it otherwise could."81

Denmark as a Model for the Euro-neutrals Quite interestingly, there may be another EC member which serves as an even more analogous model to the Euro- neutrals. Denmark did, in fact, practice a policy of neutrality for hundreds of years before it joined the Atlantic Alliance in 1949. Thus, Denmark represents a formerly-neutra1 nation within the EC (as do Belgium and Luxembourg). However, Denmark has been a "footnote country" since it joined the EC, requiring exemptions here and there. As such, Denmark represents an example of a "former neutral" which has retained elements of that neutrality, although it is a member of the EC and of NATO, and recently an observer

81Collins and McCann, 135, emphasis added.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 6 0 of the WEU. This "latent neutrality"82 was especially visible during the December 1992 Edinburgh Summit which allowed for Danish accommodations to opt-out of the EUT's CFSP, EMU and European citizenship. Indeed, neutrality, even in its "latent" form appears to be alive and well in Europe - and more specifically, within the EC. Although the EC likes to appear to be completely "in control" in bargaining positions, in this latest scenario on the Danes stalling of the EUT ratification process, it was one against twelve and the one secured its wishes since the alternative was a prolonged and perhaps aborted ratification process. Likewise, regarding the negotiating positions of the EFTA Euro-neutrals, they are, in fact, on more equal footing than the EC cares to acknowledge. While it is true that Denmark was already a member when it secured its opt- outs (as was Britain), and the EFTA Euro-neutrals are on the outside looking inside, they will be net contributors to the EC budget and this can be a most powerful bargaining chip during a world recession, if used skillfully. Consequently, Denmark may be the more appropriate comparison for the scenario under consideration especially since the three Euro-neutrals conducting membership negotiations with the

cCarsten Holbraad's 1991 book Danish Neutrality discusses the continuity of neutrality in Danish foreign policy. He refers to the most recent phase as "latent” neutrality. Prior to that time, Denmark practiced what he refers to as aligned, isolated, defenceless and non- aligned neutrality.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 6 1 EC/EU may get to the point in the negotiations where they feel they must profess to be "dropping" neutrality, upon the EC Commission's request, in order to join the EC. If this does occur, at least the Euro-neutrals can gain solace by witnessing Denmark's experience in the EC as a "former neutral," yet in practice, they will retain it, just as the Danes do. Ironically, during the formal opening of the Euro-neutrals' negotiations with the EC, Denmark, which served as the EC President to the Council of Ministers from January - June 1993 "... reeled off a list of membership requirements so intimidating that few existing member states would apply and several of which, such as foreign and defence policy, Denmark itself got opt-outs from at December's Edinburgh summit."83

°David Gardner, "New Applicants to Give Op the Neutrality Habit," The Financial Times (February 2, 1993), 2. Indeed, the EC's bark is much worse than its bite, and its rhetoric is often grand, while its actions remain on a more nuts and bolts level, as will be the case in these negotiations. For example, during the negotiations, agriculture will present more of a stumbling block than neutrality.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. CHAPTER V

CONCLUSIONS

And the end man looked for cometh not, and a path is there where no man thought. Euripides Purpose of Research In a world of big and small states, both Austria and Sweden qualify as small to perhaps mid-sized states. Given the unchangeable fact of their respective sizes and geo strategic locations in Central and Northern Europe, both have sought to preserve their respective sovereignty and national identities as best as possible. One of the most useful tools for both Austria and Sweden has been the practice of neutrality as an aspect of their security policies. Given its utility and adaptability for small states, neutrality will remain a useful tool and will continue to be practiced, albeit at an adapted level, in the post-Cold War world. While Austria's neutrality was adopted during the Cold War, Sweden's neutrality has been practiced for centuries. While Austria's neutrality is constitutionally-declared, Sweden's policy of neutrality is self-declared. While Austria has focused on the legal aspects of neutrality,

262

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 6 3 Sweden has focused more on the political aspects of neutrality. Accordingly, while Austria sought EC membership with an explicit neutrality reservation (abiding by the legality of its constitution), Sweden chose not to include any such reservation since Sweden considers its neutrality to be axiomatic, and the request for such a reservation would be implicit in any application Sweden filed for EC membership. Nevertheless, both have practiced neutrality during peacetime with the mutual goal of remaining neutral during a potential war. Therefore the difference in their approaches to neutrality does not necessarily signify that one nation takes its policy of neutrality more seriously than the other; rather it illustrates the adaptability of the policy of neutrality. In so stating, however, such flexibility does not discard the important prerequisites for adopting neutrality, and a nation cannot be expected to be taken seriously if it adopts the policy by merely claiming it as a "quick-fix." Indeed, because of credibilty's link to the concept and practice of neutrality, neither Austria nor Sweden want to cast a shadow of doubt over what their neutrality meant prior to the demise of the Cold War. This reaffirms their continued awareness of the responsibility inherent in practicing a credible policy of neutrality, not only to themselves but also to other nations. Moreover, given the increased burdens of self-

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 6 4 sufficiency and the evolving single market of the EC, Austria and Sweden are pragmatic enough to recognize the limits of non-participation in integration which will directly affect them. While Austria and Sweden were able to enjoy the best of both worlds for a considerable amount of time given the EFTA arrangement, the pace of integration has made participation in the EC and EU the best way to secure and preserve national interests, as will likely be demonstrated during the 1996 EU institutional reform conference, when the Euro-neutrals (minus Switzerland), will participate in developing decisions for the EU. Indeed, the very process of joining the EU will reinforce the comparatively strong economies of the Euro-neutrals, and will also economically benefit the current EU members. Furthermore, as the United Nations demonstrated during the Cold War, collective security and neutrality are not mutually exclusive and can co-exist. Essentially, the more there is of one, the less there is of the other, and a shift toward more collective security on a global and regional level is expected to occur in the changed international environment. Nevertheless, what are identified as goals within the EU via the CFSP cannot be expected to serve as reality until that goal is reached in the unforeseeable future. Accordingly, "business as usual" for both Austria and Sweden is not an unreasonable request, and both want to

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 6 5 keep their respective policies of neutrality intact, although both are willing to adapt these policies given the changed international environment and the gradual evolution toward the goals within the Maastricht Treaty. Accordingly, joining the EU will also not impact the independent defenses of the Euro-neutrals since current EU members maintain strong defense capabilities. As such, contrary to some of the EC's fears, retaining neutrality in post-Cold War Europe does not threaten the goal of a CFSP for the EU. In fact, accommodating neutrality within the CFSP preserves the convention of strength in diversity rather than uniformity. The EC/EU must not allow itself to indulge in the single- minded process of seeking uniformity at all costs since this could back-fire and provide the impetus for further conflict throughout Europe. Finally, in the "New World Order," the Euro-neutrals will continue to be available to serve as mediators and impartial bastions in a potentially not-so- peaceful European environment of ethnic conflict and national rivalry. Consequently, the primary purpose of this research has been completed, which was to assess the likely significance of EC and EU membership on Austrian and Swedish neutrality policies. Since reconciliation is possible between the two dynamic processes of neutrality and integration, neutrality does not have to be relinquished in order to become a member

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 6 6 of the EC and EU.

The Means of Neutrality and Integration Neutrality is considered to be a means and not an end in itself for the countries that have practiced it over the past several decades. Neutrality, like integration, is therefore a process, not a fact, and neither is practiced in a vacuum; both evolve and adapt in order to survive in constantly changing domestic and international environments. Therefore, neutrality and integration are not as incompatible as they initially seem, and, in fact, are intertwined. During the Cold War, the Euro-neutrals preferred (and could afford) to keep their distance from such supranational integration organizations as the EC. Moreover, in a bi polar, confrontational environment, perception played a particularly important role. Indeed, an affiliation with the EC in terms beyond a trade arrangement could potentially be perceived by the Soviet Union as an alliance to NATO. Thus, in order to enhance the credibility of their neutrality policies during the Cold War, the Euro-neutrals chose to emphasize the incompatibility of their neutrality status with the EC's integration goals. Consequently, during the Cold War it became a self-fulfilling prophecy that the two concepts were "irreconcilable.” In turn, this

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 6 7 had the effect of making Ireland's move toward integration in the form of EC membership appear that Ireland did not take its neutrality "seriously". However, Ireland was clearly not in the economic position the other Euro-neutrals were, and thus could nc; afford to abstain from EC membership. Nor was Ireland under the scrutiny of the Soviet Union, as were Austria and Finland, in particular. Indeed, joining the EC was not only a wise economic move for Ireland, but also a wise political move since Ireland was able to gain more visibility as distinct from the United Kingdom. Although the Euro-neutrals chose to refrain from the regional integration framework of the EC during the Cold War, they chose instead to participate in universal frameworks, such as the UN (except Switzerland), and to a lesser extent, the CSCE, since they operated outside the trappings of the Cold War. While the changed circumstances have considerably eased the Euro-neutrals' ability to bridge the gap between neutrality and integration and apply for full EC membership, the two were compatible even prior to the demise of the Soviet Union, as the Irish model demonstrates. Accordingly, while neutrality is expected to evolve in such a way as to enable it to continue to operate in an effective and positive way for the Euro-neutrals, it is primarily the international environment that has changed

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 6 8 and not the neutrality policy itself: [y]ou may argue that it is not so much we that have changed — but the situation we were reacting to - responding to - changed - and that made it possible for us to apply for membership.1 In comparing neutrality law with neutrality policy, the law is theoretically more stringent than the policy since the policy is the application of neutrality via the "means" taken by the state. However, in the cases of Austria and Finland, neutrality policy during the Cold War was even more stringent than the application of neutrality law, because these nations needed all the more to uphold their credibility, given the Soviet Union's ever-watchful eye.2 Since permanent neutrality relies heavily during peacetime on perception and credibility through consistency, the Euro- neutrals expended much time in trying not to lean toward either one or the other superpower during the Cold War. Therefore, the demise of the Soviet Union plays a large role in easing the ability to bridge the gap between neutrality and integration - but its role is not exclusive. Under neutrality law, the only "requirements" a neutral must follow are not to be aligned to any military alliance and not to permit any foreign military bases on its territory.

'uif Lindell, Second Secretary at the Swedish Embassy. Interview by author, 9 February 1993, Washington, D.C. Tape recording. Embassy of Sweden, Washington, D.C.

Friedrich Stift, Second Secretary at the Austrian Embassy. Interview by author, 4 February 1993, Washington D.C. Embassy of Austria, Washington, D.C.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 6 9 These elements are likely to remain cogent elements of the Euro-neutrals' foreign policies beyond the Cold War. After all, Denmark and Norway were both formerly neutral and have retained this rule in conjunction with their NATO membership since 1949. Moreover, beyond the Cold War, Sweden has reaffirmed that "no country other than Sweden is responsible for its defense."3 Finally, the EC's visions of European integration tend to be very process-oriented and work from the top down (the European Union) while its day-to-day realities work from the bottom up (the FTA). What the EC needs to do is bring the dream back down to earth and find a balance between illusion and reality. Indeed, the course of EC history is filled with examples of nations reasserting their sovereignty, i.e., the Luxembourg Compromise, and most recently the Danish referendum. The Treaties are filled with escape clauses for "opting-out," which allow for exemptions when "vital national interests" are at stake. Such compromise of the vision has been, and will continue to be, political necessity in order to get all members to ratify a given treaty. Indeed, the EUT is not as visionary as it initially appears, considering the pragmatism of the inter governmental nature of two of the three pillars: the CFSP pillar and internal affairs pillar. Being a means, neutrality has not entirely lost its relevance with the

^lf Linde11 of Swedish Embassy quoting Prime Minister Carl Bildt.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 7 0 changed European and international environment. Neutrality has existed for centuries and has co-existed with the collective security platform of the inter-war years, the League of Nations, and alongside the post-WWII collective security platform, the United Nations. Therefore, despite the collapse of the bi-polar system, the Euro-neutrals, to varying degrees, still consider neutrality as an important foreign policy instrument. Indeed, rather than obviating the necessity of neutrality, the changed international environment may simply necessitate its evolution. Now that the bi-polar confrontational rationale is no longer a major part of the NATO/WEU existence, it is now possible for the Euro-neutrals to join in the regional security element of the CFSP and contribute toward the Europeanization of the Alliance, yet keep a distance from the collective defense elements of the military alliance. In turn, this will make theEU a more regional European security platform. But the UN structurally oversees even this, and the EC's deferralto the UN during the Yugoslavian conflict is indicative of this trend. According to Professor Dinan, "[tjoday we live in a world where neutrality has no strategic value whatsoever, but it has a large role in the domestic politics of each of these countries [the Euro-neutrals]".4 Indeed, it is such

'Desmond Dinan. Professor at the George Mason University. Interview by author, 10 February 1993, Arlington, VA. Tape recording. The George Mason University, International Institutes, Arlington, VA.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 7 1 domestic attachment to the concept, as a source of national identity, that brings the irrational aspect of neutrality out all the mere - wanting to preserve it to the extent that it could potentially be detrimental rather than useful.

Neutrality and Interdependence States do not function in a vacuum, although Switzerland certainly makes an attempt to do this, and will likely remain the most obstinate European state to the integration process, and will continue, for as long as it can afford to, to remain outside with a "wait and see" attitude. However, there will be a point where this will begin to cost more than it is worth. Indeed, it is by participation that the Euro-neutrals will be preserving the "end" of neutrality of remaining secure, sovereign and preserving national identity. Economics is the first level of integration. Indeed, there is a direct relationship between a neutral country's ability to be economically self-reliant and a neutral's contemplation of EC membership. The neutral with the worst economy was the first to join the EC (Ireland) while the neutral that has the best economy will be the last to join (Switzerland). Switzerland's negative referendum on the EEA Treaty confirms this all the more. Ireland was simply not in a position to practice the means of neutrality quite as staunchly as the Swiss have been able to do.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 7 2

EFTA-EC Evolution and the EEA Treaty By packaging the EEA Treaty without a true co-decision making court, in which each EFTA member state counts (rather than by being lumped together in a unit), the EC essentially gave the neutral EFTA members no other choice but full EC membership in order to safeguard their sovereignty and national identity - the goal of a neutrality policy. Once the Euro-neutrals join the EC and EUT, a "variable speed" Europe will be encouraged all the more. Contrary to the EC's well known opinions, further "variable speeds" and tiers of opting "in" or "out" in such areas as monetary union, social policy and defense will result in a Europe of greater flexibility and pluralism which means strength in diversity rather than uniformity. This evolution, in fact, accommodates the neutrals all the more since they will help shape and define what that will be as members of the EUT. The Euro-neutrals have always taken the EC "seriously" as an aspiring political unit. The aspiration alone, as was implicit in the 1957 Rome Treaty and the implications for the credibility factor during the Cold War, was enough to keep them out of the EC as long as an arrangement existed that could keep pace with EC integration (i.e., EFTA). In this way, the Euro-neutrals were keeping all of their options open. Indeed, both the EC and the EFTA were pursuing parallel courses; the EFTA members were simply not

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 7 3 the leaders in integration as the EC members were. Thus, once EFTA's goal of a wider Western Europe was achieved in 1984 with the completion of the industrial goods FTA, EFTA was ready to continue to keep pace with the EC's integration. However, the mechanism (EEA) that was to resolve the marginalization issue between the EFTA and the EC turned out to be much less than was hoped for, giving the Euro-neutrals no other choice but to apply for full EC and EUT membership. Indeed, it is because the EFTA states recognize that the process of becoming full EC members is long, that they simultaneously have two plans working in tandem - plan A for the EEA and plan B for EC membership. The completion of the short-term goal of EEA will give improved access to the single internal market and will simplify and expedite the achievement of plan B, the long-term gain. Moreover, Europe needs to deal with its diversity in a positive way by harnessing it as a strength rather than dismissing it as a weakness. Specifically, the EC needs to lighten up on the dogma and illusions and get back to the basics and reality. The EEA's resulting joint court (amongst other things) was not quite what had been envisioned, as Switzerland indicated in its negative referendum on the EEA in December 1992. The desire to partake in the decision-making process provided further impetus in wanting to help shape these decisions in the new European architecture, which means via

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 7 4 the EC and EUT. Moreover, it is understandable that Switzerland also did not want to contribute 2/3 of the combined EFTA amount to be paid to the EC's cohesion funds with the start of the EEA. Yet it is arguable as to whether Switzerland's vote against the EEA was a vote against the EC, since the Swiss have every intention to pursue EC membership while circumventing the EEA and being required to act as a "unit”.5 Therefore, since EEA membership will likely not be a prerequisite to EC membership, it can be argued that Switzerland will actually be able to "have its cake and eat it too". In this way, Switzerland will be preserving the end of neutrality via what it considers to be the retention of sovereignty. At no point will Switzerland participate in something that will undermine its ability to have an effective singular voice in the decision-making process, or take advantage of its wealth. It is characteristic of the Swiss to be the staunchest in their refusal to "acquiesce" to the EC's whims. However, no state is an island and stands entirely alone. Splendid isolation is, at best, only a temporary solution, but it will be Switzerland leading the way on showing how long temporary can be.

5J.J. de Dardal. Political Counsellor at the Swiss Embassy. Interview by author, 2 February 1993, Washington, D.C. Tape recording. Embassy of Switzerland, Washington, D.C.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 7 5 Evolving Security in Europe; the End of Bipolarity Although further "Europeanization" is the ultimate purpose of the EUT in all areas of economics, politics and security, the primary focus of the supranational element within the three-pillar EUT rests within the EC/EMU and therefore remains on an economic level. Political and security issues and internal affairs issues are in separate pillars of the EUT, and will be approached via the inter governmental process. Also, by European choice, the UN has become the main international guideline body for the EU's CFSP. It is this regional structure being overseen by a universal structure, as opposed to the bloc structure, that makes Euro-neutral participation in the EUT more compatible with retaining neutrality. In fact, it can be argued that moving the EPC from the direct EC link from the SEA to the CFSP pillar of the EUT makes the process of joining all the more manageable for the Euro-neutrals since the CFSP and internal affairs pillars will clearly operate on an inter governmental level. Of course, the EC's EPC also worked on an inter-governmental level, thus the difference is not really substantial.6 The EC's deferral during the Yugoslavian crisis to the UN and not to NATO or the CSCE displays an important post-CoId War precedent. Likewise, the UN's request for NATO troops to boost its peacekeeping

‘Time will tell whether or not the EPC's formal link to the EC via the SEA was actually a stronger link than what is provided for in the EU's CFSP.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 7 6 capabilities in Yugoslavia is yet another precedent of a universal framework requesting a regional military alliance for additional resources.7 The planning for the peace force marks the first time the [UN] has worked on a blueprint for tough peace keeping to assist negotiations before they are complete.... It is also the first time that the United Nations has talked with a regional military alliance like [NATO] with a view to using its resources to support a U.N. peace-keeping operation ...* The universal nature of the UN eases the neutrals' commitments to further integration and participation in Europe's regional security development. The UN was especially important to the Euro-neutrals during the Cold War (minus Switzerland - although it participates in many affiliated UN activities, minus full membership in the organization) since the UN was somewhat removed from the bloc-to-bloc confrontation, and allowed a conducive atmosphere for the free movement of ideas. Yet interestingly, after the Cold War, regional European collective security is once again a possibility that will not compromise the credibility of neutrality, since the former Soviet Union is not the consideration it used to be. This, in turn, makes the neutrals more favorable for EC/EU membership since they have expressed their commitment to the CFSP. Indeed, the EC's EPC and the EU's CFSP function more

7Julia Preston, "U.N. Plans Strong Bosnian Peace Force: 50,000- Troop Contingent Would use NATO Resources to Enforce Eventual Accord." Washington Post. March 7, 1993, A28.

8Ibid.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 7 7 along the lines of a collective security arrangement than a collective defense platform, albeit on a regional scale rather than universal scale. This is clear since the WEU is an incremental step away from the CFSP, and it is in the WEU where the defense policy, as well as actual defense capability is to be housed (with NATO's assistance). Since this is the case, and since neutrality has historically co existed with collective security platforms, with all Euro- neutrals participating in both the UN and CSCE, this is not likely to change, and neutrality will be compatible with the CFSP. In the past, it has been easier for the Euro-neutrals to commit to a universal framework of collective security (League of Nations/United Nations) because by going the universal route, members of both sides of the blocs existed within it. This is what was unique about the CSCE; it was a regional security apparatus for Europe which included both sides of the blocs.

The Euro-neutrals' Favorable Negotiating Position vis-k-vis the EC Not all European outsiders are "EC-wanna-bes" and not all European outsiders "need" the EC more than vice-versa. This is especially true for the Euro-neutrals which have always been unique and cannot be so easily pooled with the rest of Europe that is supposedly knocking on the door for membership. Although presumed to be the European hegemon,

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 7 8 the EC does not represent everything to all Europeans, at least not yet. As such, the question becomes how much "EC- ization" has occurred, and how much is expected to be adopted by outsiders looking in? During the negotiation process, concessions will undoubtedly be made on the sides of the three neutrals (and eventually Switzerland), and the EC accordingly "widening" its integration by enlargement and "deepening" its integration with the EUT. As noted during the 1960s negotiations, the Commission was sympathetic towards both Austria and Finland, since neither really had much say in "dropping" neutrality, given the respective relations with the Soviet Union. The Commission somewhat resented Sweden and Switzerland's "choice" to remain neutral, and to negotiate as such. Yet by keeping all options open, as the neutrals attempt to do, they can inadvertently close off many options at the cost of keeping too many doors open - yet another paradox. Although the EFTA countries will be net contributors to the EC budget, they already will be in the case of the EEA, since the requirement remains to contribute to the cohesion funds; so if the EC is getting from the EFTA countries what they primarily want through the EEA, why allow them in the EC? This is clearly an extremely vulnerable position to be in. Since neutrality is an evolutionary process, it can remain by the same name. Yet for EC/EU membership negotiation purposes, and given the negative connotations of

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 7 9 neutrality's impact on political integration, rhetorical concessions will likely be made. Perhaps most importantly, all four Euro-neutrals will be net contributors to the EC budget. This comes at a time when the EC 's cohesion fund/RDF recipients (the "poor four") are demanding more funds. Indeed, part of Ireland's quick favorable response to the June referendum was a result of its need for further EC funds from the net contributors. Part of the reason why Denmark said no during its June 1992 referendum was because it does not relish the idea of subsidizing the poor four. In fact, the "big three" that in all practical reality make the broad determinations for the EC, Britain, France and Germany are all feeling pinches in their pockets these days. With Britain's request for annual budget rebates and France's position of now being the highest net contributing nation to the EC, recently surpassing Germany since its reunification, it is probable that all three eagerly await the arrival of the rich EFTA countries. Of interest is that during the Lisbon Summit, it was determined that all internal EC issues must first be resolved before any negotiations on EC membership could begin. These internal issues included the resolution of the EC budget and the ratification of the Maastricht Treaty. By the time the Edinburgh Summit came around, the priority became widening membership to resolve the budgetary and ratification dilemmas.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 8 0 Moreover, the EC's prior two enlargements of Greece, Portugal and Spain proved to be long and laborious processes. In the current case of enlargement, however, all four economies are up to speed, so the transitional arrangements will not be as long. Thus this enlargement is likely to be relatively painless, and the new members will be quickly absorbed, thus more quickly becoming assets to the current EC members via budgetary contributions and further "Europeanization" rather than the dreaded dilution of the European Union goals as set out in the EUT of Maastricht. In turn, however, the EFTA has to be careful of the possibility that the EC may feel the EEA is enough, since the EFTA countries will already be contributing to the EC funds (minus Switzerland). Indeed, this may have been a Swiss concern and what it was trying to avoid by saying no to the EEA. Finally, since all EFTA nations will be holding referenda before acceding to the EC (Finland only under advisement), there are some important lessons to be learned from the negative referenda associated with EC membership.9 It is vital for the governments to coordinate with the people as much as possible during the negotiation stages so that the people will not be surprised or feel overlooked. They are, after all, ultimately the ones that are going to

’This includes the 1972 Norwegian referendum, the June 1992 Danish referendum, and the December 1992 Swiss referendum.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 8 1 determine whether EC membership will occur or not. No matter what the negotiations resolve, it is vital that a consensus is formulated between the governments and the people. Referenda represent the people's seal of approval or disapproval of what their governments have agreed to. Given the reaffirmation of the subsidiarity principle of decentralization during the Edinburgh summit, this should be, theoretically, more simple. The parallel bilateral negotiations between the EC and the three Euro-neutrals (with Norway beginning its negotiations in March 1993), will likely result in simultaneous accession in the 1995-1996 timeframe - an enlargement of the EC from 12 to 16. Yet this is accession to not only the EC but also to the EU. Indeed, if the EC approached integration from the bottom upwards instead of the top-down: ... there might be a more relaxed European Community, content to develop at a pace that gives its citizens time to accustom themselves to a new international system and allowing the idea of a European Union to become a habit before it is prescribed as law.10

Benefits from Coordination Coordination on the sides of the neutrals will only reaffirm the means argument to neutrality. However, it is likely that there is a certain amount of resentment on behalf of Austria toward the others, since it considers

l0Anthony Hartley, "Maastricht's Problematic Future." The World Today. 48, no.10 (October 1992): 183.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 8 2 itself as "first" to apply. This acknowledges on Austria's behalf, however, the tendency of the EC to work in package deals and the likely result, as was in the case of the FTAs that what's good for Austria will also be good for the other three, no matter who applied first. Significantly, in November 1993, the three Euro-neutrals jointly announced during the EC negotiations that "... the foreign and security policy obligations in the Maastricht treaty are not problematic."u Thus, no matter the course of negotiations, whether multilateral or bi-lateral, the earliest likely date for membership is January 1, 1995, and this will likely be for all of the EC's official "Fourth enlargement" via Accession Treaties. This means that there will be a two year period where the EEA will be the closest link to the EC. Thus, it is also in the best interests of the EFTAns to ensure a sound arrangement for the EEA, even if it is now to serve primarily as a "waiting room" for EC membership, something that it evolved into - not something that it was originally designed to be back in 1984. Yet because of the EEA, the negotiations should proceed rather smoothly. As for Switzerland, it will most likely decline the EEA option and go straight to the EC. This would be typical, though, because, being the staunchest

""Finland, Sweden, Austria Stances on EU Membership," FBIS-WEU-93- 216. 10 November 1993, 5.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 8 3 adherent to neutrality in its legal form, Switzerland will not compromise its sovereignty by participating in the EEA. Hence, while it is true that the EC is in the best position to make demands, being the "core" of the newly emerging Europe, it is also true that it must work collectively with its neighbors on the peripheries of Europe - either to the North, South, East, or West. In fact, "... there may be more at stake for the EC in its dialogue with EFTA [and Eastern Europe] than has yet been admitted in the narrow 'take-it-or-leave-it' attitude that it has so far adopted."12 The EC must realize by now that it is not so insulated that it can afford to have this attitude since it faces the basic reality of global interdependence, especially in regional Europe. As Pedersen concludes: [i]t is in the EC's best interest to formulate an open-minded and forward-looking EFTA [and Eastern Europe] policy that does not slam the door in the face of neighboring countries, who are in the process of reinterpreting their international role.13

Pan-Eurooean Integration Finally, it is apparent that as further integration occurs in Western Europe, further disintegration is likely to continue in Eastern and Central Europe, and the former Soviet Union. As efforts continue toward market economies,

I2Wallace and Weasels, "Conclusions," 272.

13Pedersen, "EC-EFTA Relations: Neighbors in Search of a New Partnership," 110.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 8 4 some revert back to the command economies. Such fluctuations have necessarily changed what the EC had planned back in 1987 in the SEA for 1992, and also what EFTA and EC planned in 1985 in the Luxembourg Declaration for the EEA. Such changes provide an external catalyst to further European integration and cooperation, and provide a new responsibility for all of Western Europe to assist in rehabilitating the East. Movements by the EC and the EFTA to form association agreements and bilateral free trade areas confirm this. Indeed, the sooner the "like" countries of Europe integrate (EFTA and the EC) the sooner they can assist the countries of Eastern and Central Europe in their return to Europe. Hence, the EFTA and the EC are working collectively in their approach to Central and Eastern Europe, and view expeditious ratification of the EEA Treaty as one step closer to assisting them. Therefore, in a sense, Western Europe is in a process of reconciliation that must be attended to before the wider Eastern reconciliation is accomplished.14 Above and beyond EFTA-EC collaboration toward the east, the EC Commissioner Van den Broek is entertaining the idea of a "European Political Area" for the east. Since the association agreements with the ex-CMEA countries will only go so far, the EC feels the need to

,4See: EFTA Bulletin, vol.XXXII, no.l {January-March 1991), 11. and EFTA Bulletin, vol.XXXII, no.l (January-March 1991), 28.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 8 5 include them in a political way as well: [t]he EC must seek closer political contact with the countries of Central and East Europe. A European Political Area could be created to achieve this.... Within this [EPA], the East European countries ... could be gradually and constructively involved in the discussions which take place within the EC institutions about matters of common interest. Van den Broek announced that the EC Commission will shortly present concrete proposals in this field.... the EC has provided by far the most aid to C and E Europe and to the former SU. More than 60 percent of the overall support of the group of 24 industrialized nations was provided by the EC.5 By September 1993, the EC held its first political dialogue meeting with Poland, Hungary, the Czech and Slovak Republics, Romania and Bulgaria.16 This is an encouraging sign that the EC/EU is ready to accept responsibility for its statements over the last couple of years toward the Central and Eastern European nations clamoring to get inside the EC's fold. The EC/EU would be wise to include the EFTA nations in such a reconciliation so that a true European Union may be more easily formulated. In conclusion, European neutrality and European integration are both dynamic processes which represent means for nation states to maintain sovereignty and achieve common or similar goals. Neutrality can serve as a means to preserve the sovereignty and national identity of some states while integration serves as a cooperative mechanism,

,s"EC's Van den Broek Proposes 'European Political Area," FBIS-WEU- 93-042. 5 March 1993, 2.

“"EC Launches Political Dialogue With Eastern Europe," FBIS-WEU-93- 182, 22 September 1993, 12.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 8 6 enabling the participants to keep pace with the growing interdependency of the world, whether on an economic, political or security level. Both are tools which ultimately ensure the viability of each nation state which chooses to engage in either process. Thus, despite the European Community's goals of deeper, and increasingly comprehensive integration, the continuation of the inter governmental nature of deeper integration goals, such as the common foreign and security policy, will allow for reconciliation with neutrality. Furthermore, despite the end of the Cold War, European neutrality still has an active role to play in the developing regional European security architecture. As members of the universal collective security organization, the United Nations, Austria and Sweden focused their attention and experience during the Cold War on collective security as opposed to ideologically divided defense blocs. This experience will enable the Euro-neutrals to be potential leaders in any future collective security organization. Therefore, both Austria and Sweden are able to join both the European Community and the European Union without having to relinquish their neutrality. As neutrality is an adaptable process which will continue to evolve by enhancing security through participation in the broader scheme of European integration, so too will the dynamic process of European integration adapt to and benefit from the precepts of European

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 2 8 7 neutrality as the European integration process proceeds "toward an ever closer union."

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