ANNIVERSARY 1998-2018

The fi ght for liberal values Annual Report 2017

CENTRE FOR EUROPEAN REFORM

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THE CER IN NOVEMBER 2017 About the CER FROM LEFT TO RIGHT, TOP TO BOTTOM: John Springford, The Centre for European Reform is a European think-tank with Ian Bond, its head offi ce in London. It seeks to achieve an open, outward- Christian Odendahl, Simon Tilford, looking, infl uential and prosperous European Union; and a Noah Gordon, Agata mutually benefi cial relationship between the EU and the UK. Gostyńska-Jakubowska, The referendum makes the CER’s work more relevant and Bea Dunscombe, Kate Mullineux, necessary than ever. The EU badly needs reform, while the UK’s ties Sophia Besch, Jordan with it need serious and sensible analysis. The CER favours as close Orsler, Sophie Horsford, as possible an economic and political relationship between the UK Beth Oppenheim, Lucy Slade, Charles and the EU, while respecting the result of the referendum. Grant, Nick Winning We are extending our reach geographically. In January 2017 we opened an and Luigi Scazzieri offi ce in Brussels, to house a third of our research staff . In October 2016 our Absent from the photo: chief economist moved to Berlin. Half our researchers are from EU countries Camino Mortera- other than the UK. Martinez

In addition to our Brexit-related events and publications, we will keep working on the trials and tribulations of the eurozone; on the EU’s single market and its energy and trade policies; on its foreign, defence and security policies – including the EU’s relations with its neighbours, and with Russia and China; on the way the Union handles refugees and migration; on law enforcement and counter-terrorism in the EU; and on improving how the Union’s institutions work and relate to voters.

The CER’s work will continue to be guided by the same principles that have served us well since our foundation in 1998: sober, rigorous and realistic analysis, combined with constructive proposals for reform.

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ABOVE: (L to R) Starting again Wolfgang Ischinger, by Nick Butler Nick Butler and David Miliband

th The young executive assistant was charming. “Here’s the cheque. Good CER 10 birthday luck. Sooner you than me though – must be a nightmare working with party, 2008: all those Europeans”. Suddenly the Centre for European Reform had its Hosted by the fi rst funds. Charles Grant dates the CER from the month that we fi rst then German Ambassador acquired an offi ce, in January 1998. But conception came somewhat Wolfgang earlier – in the back row of the post-lunch session of a conference in Ischinger, Königswinter on the Rhine in 1994, when two slightly bored attendees London started to whisper and pass notes to one another. But for the whispers I might have slipped out to climb the Drachenfels.

The need for an entity designed to improve process will somehow be stopped or reversed, the quality of the debate on the EU in the UK, but the CER cannot realistically plan on that and to encourage Britain to lead the necessary basis. The strong likelihood is that in March 2019 process of change and reform in Europe – Britain will be out of the EU and into some form instead of standing on the sidelines criticising of transition process. In the eyes of the rest of – seemed obvious to David Miliband and me the EU we will be a ‘third country’, without a seat that afternoon. Creating that organisation at the table. The belief of those leading the CER took time, and required much help – not least – that the UK should be at the heart of Europe from David Simon, then chief executive of – may be unchanged but we will not be able to BP and a committed European. He made the work as if nothing has happened. In 1998, under introductions, then I made the calls and learnt a pro-European British government, everything the pleasures and pain of gathering the people seemed possible. Now, even if the negotiated and the money. settlement of Brexit keeps us reasonably close in terms of trade, the politics will be very Now, two decades on, we have to start again. diff erent. Europe will move on and so will the We might hope as individuals that the Brexit UK. Divergence between Britain and Europe

13898 CER TEXT annual_report_2017 GB.indd 3 06/02/2018 11:12 seems very possible and for some very welcome. themselves. The CER, starting again, should Instead of working with the grain, we will fi nd focus on the positive necessity and potential of ourselves working against it. engagement, looking to the future not the past.

But that is not a counsel of despair. Politics To infl uence European policy we will have to be never reaches a permanent conclusion. The in Europe physically, which is why the opening 1975 referendum which confi rmed the UK’s of an offi ce in Brussels is so important and why position in Europe was not the end of the story. that step will probably have to be followed by Nor is the referendum of 2016. The political expansion in Berlin and an offi ce in Paris. For wheel keeps turning. the CER, however, being European and British does not involve any trade-off , or a hard choice The CER is not a campaigning organisation. between the two. We can and must be both, Others will do the campaigning – and one and one day there will be a British government hopes they will be more eff ective than they which will recognise the importance and value of were in 2016. The CER’s role is to present the the European relationship, and which will need facts and the arguments which substantiate objective and practical advice. our continuing belief that Britain and Europe belong together. In the post-medieval world, The techniques of persuasion will have to change sovereignty is an illusion. Economic, security and as well. We might like to think that a combination environmental issues don’t recognise national of hard facts and serious analysis expressed borders. They all require common responses in beautifully written pamphlets will always across Europe, and beyond. Splendid isolation triumph over sound bites and emotion, but we will not last long. must learn from recent experience that that is not always the case. We might not like populism The CER has long been writing not just about and the emotional side of politics, but we have Britain in Europe, but about Europe in the world. to fi nd ways to counter their eff ectiveness. We With America (before and no doubt beyond cannot allow those we disagree with to win just President Trump) wanting to limit its own global because we are too fastidious to take them on. role, Europe will have to step up or fi nd itself surrounded by a series of failed states. With China Accepting that we have not succeeded in determined to join the United States in playing achieving our original goals is the essential fi rst a leading role in the global economy, based on step. The quality of the debate on Europe in science and technology, Europe will have to Britain has not improved. UK politicians were develop a new competitiveness or fi nd itself not at the heart of Europe even before the Brexit undermined by unemployment and declining vote. The reforms across the European Union living standards. With the Middle East and North which were necessary then largely remain Africa destabilised by rapid population growth, necessary today. But recognising those facts religious confl ict and potentially by a new era is not a cause for the ultimate blasphemy of of low energy prices, the risk of new waves of despair. It is simply a realistic acknowledgement migration crises on Europe’s borders is high. of the point from which we (re)start. In our beginning is our next beginning. It is on those key questions that the CER can build a new agenda – demonstrating that Which takes me back to that fi rst cheque – a responses are possible as well as necessary but generous donation from Michael Green, the that the only eff ective answers will be collective head of Carlton Television, without which we and pan-European. We will need more Europe, could never have moved from conception to whether the UK is a formal member of the birth. The charming executive assistant remains European Union or not. in my mind. A young man in his fi rst job. I remember his name. Somewhere I must have Our agenda and aspiration therefore does not his card. I wonder whatever happened to change because it remains based in reality. ? But the context in which we are working will be diff erent.

For the moment the details of Brexit are all important but time will pass, a deal of some sort will be done, and it is important that we do not waste time refi ghting old battles. Little purpose will be served by pointing out the negative Nick Butler consequences of Brexit – they will speak for Co-founder, CER

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Continuity and change over 20 years by Charles Grant

In 2018 the Centre for European Reform celebrates its twentieth ABOVE: birthday. Having been conceived in the mid-1990s at a British-German (L to R) Charles Grant and Königswinter conference, we opened an offi ce in January 1998. The Michel Barnier story of the CER refl ects that of the UK’s place in Europe and Europe’s Conference on place in the wider world, and falls into two halves – the fi rst ten years 'The future and the second ten years. of the EU', Brussels The CER was born into a climate of global Russia was imperfectly democratic but in too optimism, particularly in Western countries. much of a mess to threaten its neighbours. In economic and strategic terms, the world China was focused on economic growth rather was unipolar. America’s strength ensured than challenging the West. was a friend that democracy and liberalism were steadily of the US and the EU, and fairly democratic. extending across much of the globe. Most There were always transatlantic tensions, of Central and Eastern Europe had become especially after the arrival of George W Bush in democratic, as had parts of Africa, East Asia and 2001, but these were usually containable. Latin America. A plethora of international treaties and organisations that covered subjects ranging Much of this benign climate endured through the from trade, to climate, to arms control, to war fi rst ten years of the CER. Even the 9/11 terrorist crimes were gradually enmeshing the world in attacks led to our publishing an optimistic set a system of global governance. Western military of essays on how the common threat of Al- interventions in places like Bosnia, Kosovo and Qaeda would bind the West and the Russians Sierra Leone succeeded. more closely together. In those early years our

13898 CER TEXT annual_report_2017 GB.indd 5 06/02/2018 11:12 focus was on the EU’s enlargement, how the EU The euro crisis engendered recession, could help Russia to modernise its political and austerity and high unemployment in several economic systems, whether the UK would join EU countries. This fuelled the rise of populist, the euro and how the UK was leading plans for eurosceptic forces. So did the refugee and EU defence. A CER report in 1998, ‘Can Britain migration crises, which became acute in lead in Europe’, suggested the abolition of the 2015 – provoked in part by the failed Western Western European Union and a new role for interventions in Iraq and Libya and by the non- the EU in defence; a few months later Tony Blair intervention in Syria. and Jacques Chirac echoed these ideas in their Saint-Malo declaration on European defence. We Meanwhile, as China’s economy continued published a lot on the reform of EU institutions to experience annual growth close to 10 per and – especially after the of 2003 created cent, its geopolitical clout grew. Its success a transatlantic rift – ways of bringing Europe and made its overtly undemocratic system seem an America back together. appealing model to other regimes. It became bolder in challenging America and its allies in East Asia. The high oil price until 2014 enabled The fi nancial crisis which began in 2007 and Vladimir Putin to restore Russia’s military “ strength and entrench his authoritarian, 2008, and which evolved into the euro crisis in 2010, nationalistic regime. The West did little beyond undermined the standing of elites across Europe.” wringing its hands when Russia invaded parts of Georgia in 2008. Its response when Russia invaded Ukraine in 2014 was more In its early years the euro seemed to work well robust, but still not enough to prevent the and in 2000 EU leaders promised to make the EU annexation of Crimea and the destabilisation “the most competitive and dynamic knowledge- of parts of eastern Ukraine. In Turkey, after based economy in the world”, through their several promising years of reform, Recep ‘ agenda’ of economic reform. In 2001 Tayyip Erdoğan’s regime started to resemble we published the fi rst of our ten annual Lisbon Russia in its authoritarianism and anti-Western scorecards, in which we awarded marks to nationalism. each EU government for its performance in implementing the promises made on economic And then came 2016. In Britain, those reform. Although real progress was made in campaigning to leave the EU latched onto the some countries, in areas like labour market fact that many Britons did not believe they reform and removing the red tape that impeded benefi ted from trade, migration, globalisation start-ups, there was insuffi cient reform, and EU integration. Fifty-two percent of the particularly in Southern Europe. British were prepared to give the country’s liberal establishment a good kicking. A few And that contributed to the euro’s problems. We months after the British voted to leave the were prescient in spotting that not all was well EU, many Americans voted for Donald Trump in the eurozone. In 2006, shortly after he joined for comparable reasons. Both events, but the CER, Simon Tilford wrote a seminal report, particularly the second, damaged the West. ‘Will the eurozone crack?’, arguing that diverging productivity and growth levels between the Trump shows little interest in the traditional north and south of Europe made the euro Western and American concepts of rule of law unsustainable in the long term, unless the south and human rights. His sympathy for regimes – embraced radical reform. At the time many whether in Russia, Saudi Arabia or elsewhere eminent economists dismissed this report as – that reject liberal values and abuse human eccentric and eurosceptic. rights has weakened the Western brand. So has his hostility to the Western-led system of As our fi rst ten years drew to a close, Europe’s free trade and global governance – as seen problems mounted. The Iraq War had a number in his opposition to NAFTA, the Trans-Pacifi c of negative consequences that did not become Partnership, the World Trade Organisation and apparent until several years after the event. the Paris climate change agreement. Sterling Crucially, the war weakened and sapped trust eff orts by some of Trump’s top offi cials and in the UK’s liberal, pro-EU establishment. The foreign allies have limited the damage that fi nancial crisis which began in 2007 and 2008, Trump has infl icted, for example on NATO, but and which evolved into the euro crisis in 2010, his own instincts may be harder to restrain in a undermined the standing of elites across serious security crisis. Europe. It also damaged the Western brand in other continents.

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In 2017 the EU coped quite well with this new The eurozone grew at over 2 per cent in 2017, and much more diffi cult environment. Brexit its best performance since the euro crisis began. ABOVE: turned out to be a one-off problem, with no Once Germany has a government, Angela Merkel Martin Selmayr country preparing to follow the UK out of the will work with ’s Emmanuel Macron on CER/Kreab club, and support for anti-EU parties waning reforms for eurozone governance, with the breakfast on in many – though not all – parts of the EU. emphasis likely to be on strengthening the 'The future The refugee and migration crises, though still banking union, some sort of ‘European Monetary of Europe', alarming, abated; Turkey stemmed the fl ows Fund’ and an initially small eurozone budget. Brussels into Greece while the EU’s dealings in Libya led The EU has pushed ahead with trade deals with to lower numbers crossing the sea northward. Canada and Japan and has many others in the pipeline. However, it has moved too slowly on its Perhaps the most worrying political plans for a capital markets union and has done development in 2017 was the growing rift too little to develop policies that encourage between Poland and Hungary (and to a lesser innovation. The EU’s new budget cycle, which will extent other Central European countries), start in 2021, off ers opportunities for developing on the one hand, and France, Germany and more growth-friendly policies – so long as the Brussels institutions on the other; their European leaders can avoid becoming bogged arguments over quotas of migrants, respect down in interminable rows over how to make up for the rule of law and plans for EU integration the loss of Britain’s contributions. appear unresolvable in the short term.

The CER in 2017 Brexit has inevitably made an impact on the tackled institutional and many other themes CER’s work, both in terms of its content, and the in a major report published in November 2017, demand for our analysis. But the overall mission ‘Relaunching the EU’. In this we argued that remains the same – to come up with new ideas Emmanuel Macron’s idea of a multi-tier Europe, and policies that will help to make the EU more in which some countries integrate further but open, outward-looking and eff ective. At least others are not obliged to follow, is the best way half our work has nothing to do with Brexit. We forward for the EU. Such ‘fl exibility’ could make are busy with subjects such as eurozone reform, the EU less brittle and in the long run more innovation, trade, energy, migration, police and viable. Taking the idea of tiers a little further, judicial co-operation, the EU and China, the EU if neighbours were allowed to join some but and Russia, transatlantic relations and EU defence. not all EU policies, further enlargement could become easier for existing members to swallow, And we shall keep working on EU institutions, and the EU could be a more infl uential player in as we have done for the past 20 years. We its neighbourhood.

13898 CER TEXT annual_report_2017 GB.indd 7 06/02/2018 11:12 Evidently, however, a large chunk of the CER’s in Berlin since the autumn of 2016. That two work is about Brexit. We regret that Brexit is likely of our researchers are German – Christian plus to happen and hope that our work can help Sophia Besch, our defence analyst – enabled us to minimise the likely damage. Some versions to publish some fi rst-class analyses of German- of Brexit would be very costly in terms of lost specifi c issues in 2017. Similarly, the nationalities economic output, and others less so. All of them of Agata Gostyńska-Jakubowksa, Camino will diminish Britain’s voice in the world, to a Mortera-Martinez and Luigi Scazzieri have greater or lesser extent. Our job is to make the strengthened our coverage of Poland, Spain and case for the best possible deal, that is to say one Italy, respectively. The strength of our research which – within the parameters set by the realities team was recognised by Prospect magazine, of European and British politics – maximises which awarded the CER its prize for the best UK- economic ties and other sorts of co-operation, based international aff airs think-tank. including on foreign policy, defence and security. At the end of the year we were sad to bid Our job is to make the case for the best possible farewell to Simon Tilford, our deputy director, “ who has led our work on economics for more deal, that is to say one which maximises economic than a dozen years. We wish him luck in his ties and other sorts of co-operation, including new role at Tony Blair’s Institute for Global foreign policy, defence and security. Change. In his place John Springford, who has ” driven much of our work on the economics of Brexit, becomes deputy director, while In early 2018 it seemed plausible that Britain was we have hired a new economist and trade heading for ‘Canada Plus’, a free trade agreement expert, Sam Lowe. Earlier in the year we were modelled on that between the EU and Canada, sad to lose Rem Korteweg, who had worked but with a wider scope, notably on security on foreign policy and trade for four years, to co-operation and services. We think it likely that the Clingendael Institute in The Hague. Nick such a deal will be much more damaging to Winning, an experienced journalist, joined the the British economy than many Britons expect, CER as our fi rst ever full-time media offi cer. Luigi though we hope that this prediction turns out to Scazzieri, the 2016-17 Clara Marina O’Donnell be too pessimistic. If economic weakness in 2018 fellow, stayed on to work on the Middle East starts to push public opinion towards regretting and other issues. His successor as the Clara Brexit, and if the Labour Party becomes bolder, Marina O’Donnell fellow is Noah Gordon. Beth there is a chance of achieving a softer Brexit Oppenheim joined the CER to research the than currently seems likely. For example, the UK Brexit negotiations. In the admin team, we said could end up in a customs union with the EU and farewell to Daniel Crewes and Anna Yorke while might stay in several of its regulatory agencies. welcoming Bea Dunscombe and Lucy Slade.

The CER has a particular role to play in helping We were very sad that Stephen Tindale, the each side of the Brexit negotiation understand eminent environmentalist, died in July. Stephen what the other thinks, and why. We do this worked at the CER from 2010-15 and wrote through publications, seminars and, especially, memorably on issues such as climate and energy. our informal contacts with offi cials and politicians in London and many other European The CER’s advisory board continued to give capitals. We can only play this role by remaining us much good counsel. Alex Stubb had to scrupulously independent of all parties, resign because of his new appointment at the governments and institutions. We think that European Investment Bank. Susan Hitch retired our educational eff orts are sometimes fruitful, from the board after many years of service. though many infl uential and powerful fi gures in The new members were Jonathan Faull, who the UK remain woefully ignorant of the EU and was the most senior Briton in the European how it works. Commission; David Claydon, the co-CEO and co-founder of Macro Advisory Partners; and Throughout our 20 years, about half the CER’s Paul Adamson, the editor of E!Sharp and researchers have been non-British. To reinforce chairman of Forum Europe. the fact that we are a European think-tank rather than a British institute looking at the EU, As we have done for 20 years, in 2017 we we opened a Brussels offi ce in January 2017. continued to host memorable events, most This has made the CER more visible in the EU’s of them small and intimate but some of capital and helped us to host more events there them large and spectacular. The majority than ever before (20 in 2017). We have also had took place in London and Brussels but we our chief economist, Christian Odendahl, based also held seminars in Washington, Moscow,

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Paris, Berlin, Warsaw, Dublin and Levi (in the Stiftung Wissenschaft und Politik, which included ABOVE: Finnish Arctic). Our dinners and breakfasts a dinner speech by National Security Adviser (L to R) Hilary featured Commissioners Anders Ansip, Jyrki HR McMaster that was extremely tough on Benn, Yvette Katainen, Julian King, , Cecilia Russia and North Korea, and contributions from Cooper, Ian Malmström and , as well as three other senior administration offi cials (Wess Bond, Chuka British politicians such as Keir Starmer, Labour’s Mitchell, Brian Hook and Matthew Pottinger). Umunna and Brexit spokesman, and Damian Green, then the Keir Starmer Conservative deputy prime minister. Our Labour The 18 longer reports and policy briefs that party conference fringe event had all all-star we published in 2017 covered a wide range of Fringe line-up of Keir Starmer, Yvette Cooper, Hilary topics, including the relationship between the meeting at Benn and Chuka Umunna. So did our Tory party EU, the Eurasian Economic Union and China’s Labour party conference fringe, which featured a wide range ‘One Belt, One Road’; whether the EU could conference of Conservative opinion on Europe: Andrea use its structural funds to promote the rule on 'How to Leadsom, Vicky Ford and Dominic Grieve. of law within member-states; the role of the handle Brexit', Trump administration and the EU in the Middle Brighton To mention just fi ve events from the autumn East peace process; how the EU could work that stick in the memory: a breakfast in Brussels with third countries to manage migration; and in September with Martin Selmayr, President the institutional governance of the eurozone. Juncker’s chief of staff , on the future of the EU; Inevitably, several policy briefs covered aspects our annual Bodrum conference in October, of Brexit, such as the possible utility of the which included a dinner speech by Mehmet ‘Swiss model’ for the UK, the impact of Brexit on Şimşek, Turkey’s deputy prime minister; our European energy markets, Germany’s priorities in annual economics conference at Ditchley Park the Brexit talks, the role of EU institutions in these in November, on whether populism is driven negotiations and the conundrum of the border mainly by economics, which included Marco on the island of Ireland. Buti, Barry Eichengreen, Jean Pisani-Ferry, Norbert Röttgen, Ludger Schuknecht, Poul One policy brief deserves particular mention. Thomsen, Adair Turner, Constanze Steltzenmüller In February we published ‘The €60 billion Brexit and Jeromin Zettelmeyer; in the same month bill: How to disentangle Britain from the EU our Brussels conference on the future of the budget’, by the Financial Times’ Alex Barker. EU, which featured a keynote speech by the Downloaded 22,000 times, this predicted that Commission’s Brexit negotiator, Michel Barnier, the 27 would unite around the Commission’s as well as contributions by John Bruton, Hélène calculation that the UK would have to pay about Rey, Monique Ebell, , George €60 billion in order to leave the EU, and that Robertson and Sophie Magennis; and our the UK would pay. The conclusion to ‘phase one’ Daimler Forum in Washington in December that of the Brexit talks in December showed that we run with the Brookings Institution and the Barker’s predictions had been broadly correct.

13898 CER TEXT annual_report_2017 GB.indd 9 06/02/2018 11:12 Ten ingredients of success Over 20 years we have moved with the times of the conversation); and the multinational – for example by publishing fewer longer character of the CER's research team. reports and more short pieces, and becoming active on social media. But we believe that the The next fi ve were the contribution of our fundamental ingredients of our success have advisory board, whose distinguished members endured. Our fi rst annual report, for 2002, advise us on our work programme and strategy; looked back on our fi rst fi ve years. In that report the strength of our website, with its clear and I set down the ten factors which I thought had unfl ashy style; our proximity to governments helped the CER to thrive. and EU institutions – we often talk to politicians and offi cials, across the continent, which helps to make our proposals well-informed “We do not want to grow larger, lest we lose the and ensures that the right people listen to our virtues of teamwork, focus and quality control. ideas; our proximity to the private sector – we ” spend a lot of time talking to business people, which enables us to stay abreast of trends in the They are still pertinent today and will I hope corporate world and to advocate a pro-market continue to guide us for the next 20 years. agenda; and the nature of our proposals, which The fi rst fi ve of those factors were teamwork as I wrote in 2002 “are sometimes radical, but – everybody helps their colleagues with … usually down-to-earth and practical, which publications; presentation – everything increases their chances of being adopted”. we publish is rigorously edited so that it is readable; proximity to the media – all As I also wrote in that fi rst annual report, “we researchers know that a big part of their job is do not want to grow larger, lest we lose the to help journalists from across the globe, thanks virtues of teamwork, focus and quality control.” to which we are often quoted; the high level Whatever the state of the EU and of the UK’s of debate in our seminars – most of which are relationship with it, we believe there will be a small and invitation-only (I have long believed demand for the serious, sober, practical and that there is an inverse correlation between the original work that is the CER’s hallmark. number of people in a seminar and the quality

Charles Grant Director, CER

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ABOVE: Cecilia What a diff erence a decade Malmström

CER/Kreab makes breakfast on 'The future by Simon Tilford of EU trade policy', Brussels When I joined the CER in 2006, there was broad optimism about the European economy and the prospects of economic convergence between richer and poorer members of the EU. Most economists focused on improving the supply-side performance of EU countries rather than on broader macroeconomic questions. In my fi rst major report for the CER, ‘Will the eurozone crack?’, I warned that growing imbalances within the currency union threatened its stability and, if left unaddressed, its integrity. But I did not imagine that the eurozone economy in 2017 would be barely bigger than in 2006. Back then no one imagined Europe could suff er a lost decade of the kind we had already seen in Japan, accompanied by very low infl ation, zero interest rates and exceptional monetary policies like quantitative easing. A few prescient people argued that Britain’s preferred role of bridge between the US and decision to stay out of the euro would the rest of Europe, few thought the UK would ultimately condemn it to an outer sphere of wilfully burn one end of the bridge down. the EU, emboldening the eurosceptics’ claim that the country could not defend its interests Back in 2006, the democratic systems of the within the Union, but such voices were few new Central and East European member-states and far between. I certainly could not foresee of the EU were still consolidating. There were a time when the UK would forego the benefi ts some concerns about both the Czech Republic of EU membership for the hard-to-pin-down and Slovakia, but Hungary and Poland appeared freedoms of life outside the EU. While some to have made remarkably smooth transitions questioned the ability of the UK to carry out its to democratic governance. There was very little

13898 CER TEXT annual_report_2017 GB.indd 11 06/02/2018 11:12 to suggest that 12 years hence both would The UK’s decision to stay out of the eurozone was be seeing increasingly determined attacks on well-grounded. Had it joined, it is possible the the rule of law or that people would be openly country’s membership would not have survived raising the spectre of Central European countries the fi nancial crisis. However, if Britain had made falling under the sway of Russia. it through the crisis without crashing out of the currency union, it would not have voted to There was widespread European disillusionment quit the EU and would now face far fewer risks, with the US, largely as a result of the Iraq War notwithstanding the continued straitjacket of and the personalities who had prosecuted it. eurozone membership. Whether or not Britain No US President, including Ronald Reagan, had manages to rescue something from the current been held in such contempt as George W Bush, mess – I suspect it will ultimately end up with whose administrations had done much to bolster something that looks like membership of the the anti-Americanism that was always latent in EEA – it is impossible to know whether the UK much of Western Europe. But however alienated will resolve its ambivalence over the EU any time many Europeans felt from Bush’s US in 2006, it soon. On an optimistic note, the current situation was unimaginable that the US would openly is at least giving British politicians and voters a question the rules-based international system crash course in what the EU is and what Britain that it underwrote and from which it benefi ted gains from being a member of it. Britain’s young so much. The idea of President Donald Trump are strikingly pro-EU, too. was entertained only in one Delphic episode of The Simpsons. The political crisis in Poland and Hungary, and more broadly the fragility of democratic norms in Central and Eastern Europe – the Baltic states “Warsaw and Budapest are checking out of the aside – poses a bigger challenge to the EU obligations of EU membership, while wanting to than Brexit. Governments are reshaping their countries’ constitutions away from liberal values. retain the rights and fi nancial benefi ts.” Warsaw and Budapest are checking out of the obligations of EU membership, while wanting to retain the rights and fi nancial benefi ts. The major Fast forward to 2018: the eurozone has survived risk is not a formal EU exit, but a de facto exit with its membership intact, despite an awful from the values of the EU, something Russia fully decade. Its resilience is remarkable – it has understands and is working hard to bring about. survived huge policy errors during and after the crisis, without a populist backlash in any of Much will depend on what happens in Poland, its crisis-hit members leading to one of them by far the biggest and most important of these leaving the currency union. While it suff ers countries. While the current situation looks from a profound lack of democratic legitimacy dire, there are still grounds for some optimism. – having much reduced the policy space open Polish voters remain overwhelmingly pro-EU, to governments – it appears strikingly robust. It including a majority of the governing Law and is true that political upheavals often come after Justice party's voters. The EU has to fi nd a way the moment of maximum economic crisis has of demonstrating to Poles that they cannot passed, but there now seems no obvious short- combine illiberal populism at home with all the term threat to the survival of the currency union. benefi ts of EU membership. More generally, in considering its various sets of criteria, the EU Of course, much will depend on the length and needs less Maastricht and more Copenhagen. strength of the current economic upturn, and how widely its benefi ts are shared across the Only Brexit Britain rivals the Trump eurozone. The longer and stronger the recovery, administration’s disregard for key national the more space the authorities will have to interests. At the moment, it is hard to keep up counter the next recession: fi scal positions will with the damage being done to US interests, be stronger, allowing governments to boost and hence to broader Western ones. Bar a move spending without breaking the fi scal rules, while against Trump by the Republican Party, the the ECB will have been able to raise interest chances are that he will see out his full four-year rates signifi cantly, allowing it to cut them to term. Moreover, his base remains supportive, fi ght off recession. Forecasting downturns is suggesting that it is not beyond the realms all but impossible, but there are grounds for of possibility that he could be re-elected, or cautious optimism that the recovery could last that the next Republican candidate for the several years. presidency will also be avowedly populist. While US demographics favour the Democrats,

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increasing the chances of a liberal or centrist ways many members of the EU have hitherto president at some point, it is more than possible eschewed. Finally, it will mean encouraging more ABOVE: that Europeans are going to have to deal with a civic, less exclusive national identities; should it (L to R) US they do not recognise or understand for some fail to do so, Europe will not be able to cope with Emmanuel time to come. the inevitable fl ow of people from the south and Macron and east. All of these challenges would have been Simon Tilford What does all this mean? It means that Europe is easier to meet with a fully-signed up Britain. on its own in a way it has not been in the post- As it stands, an awful lot of responsibility rests Roundtable on war period. It cannot rely on the US as it could in on the shoulders of the French and German 'Brexit and the the past. It faces hostility to the east from Russia governments. future of the and Turkey, an increasingly assertive China, and EU', London, serious populist pressures within its borders. It September has to ensure that economic growth benefi ts 2016 people on middling and low incomes, and demonstrate to voters that EU governments are able to address their fears. Crucially, it has to do these two things in a way that is consistent with non-discrimination within the EU and openness Simon Tilford to the rest of world. That means spending much Former deputy director, CER more on defence and using military power in

13898 CER TEXT annual_report_2017 GB.indd 13 06/02/2018 11:12 Foreign policy in 2017 by Ian Bond

ABOVE: It is tempting to reproduce large parts of last year’s annual report Rose wholesale this year. The European neighbourhood remained violent Gottemoeller and chaotic; Syria’s civil war may be closer to its end now than a year Dinner on ago, but the agony of its people continues; Turkey’s relations with the 'The strategic EU have continued to deteriorate; migrants have continued to fl ow challenges facing Europe', to Europe, though many have drowned in the Mediterranean; Russia Brussels continues to destabilise Ukraine, and its forces in that country continue to infl ict military and civilian casualties; China continues to rise. Russia’s President Vladimir Putin and China’s President Xi Jinping look secure in their positions; Xi, in particular, increased his power both domestically and on the international stage. There have also been important changes, as the capital of Israel. He also announced that however, many of them linked to the arrival of US the US would withdraw from the Paris climate President Donald Trump. America’s confrontation agreement, setting him at odds with almost with North Korea has intensifi ed, as Pyongyang’s every other country in the world. Trump has nuclear and missile programmes have advanced, repeatedly shown his disdain for the EU, NATO posing a more direct threat to the US. And in and the WTO – international institutions which the Middle East, Trump has added fuel to a have underpinned the liberal international number of fi res, threatening the agreement order and America’s pre-eminence for decades. that ended Iran's nuclear weapons programme and overturning the longstanding international Though the new French president, Emmanuel consensus on the non-recognition of Jerusalem Macron, has shown welcome signs of ambition

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and fresh thinking about the EU, the diminished policy achievements in 2017, even if its co- international standing of Chancellor Angela operation with NATO improved. The EU High Merkel and Prime Minister , both of Representative for foreign and security policy, whom lost ground in elections, has left Europe , had been almost invisible a weaker player in international crises. The EU in international eff orts to resolve regional could point to few if any signifi cant foreign confl icts.

The Middle East and North Africa On the positive side, determined action by the US, Russia, Iran and their allies pushed back the For the EU, the prospect of Iran resuming so-called Islamic State, forcing it out of most of “ the areas it had captured in previous years in Iraq its nuclear programme was extremely and Syria. That still left both countries in states unwelcome. of chaos; and Europe nervously awaited the ” possible return of those who had gone to fi ght in the region and might now try to continue their One of the signal achievements of EU foreign jihad at home. policy, the deal by which Iran agreed in 2015 to end its nuclear weapons programme, known On the negative side, none of the confl icts as the Joint Comprehensive Plan of Action in the region seemed any closer to a political (JCPOA), came under enormous strain in 2017 settlement by the end of the year. Though because of Trump's opposition. Though he did forces loyal to Bashar al-Assad continued to not re-impose sanctions, in October Trump make progress in Syria, with a good deal of help refused to recertify Iran's compliance with the from Russia, regaining many rebel-held areas, terms of the agreement, making it possible for fi ghting and civilian casualties continued. Since the US Congress to impose sanctions (though the outbreak of the civil war in 2011, the EU it has not done so thus far). Trump also threw had supported the UN-led peace process, but America's weight behind Saudi Arabia, and by 2017 the initiative had shifted from the UN particularly its young and hot-headed Crown to Russia: President Vladimir Putin organised a Prince, Mohammed bin Salman, encouraging his summit with Turkey and Iran in November to confrontation with Iran (including in the bloody discuss starting negotiations with the Syrian war in Yemen). For the EU, the prospect of Iran government and various opposition groups. resuming its nuclear programme and of a wider war in the Gulf was extremely unwelcome. In Libya also, the EU gave political backing to the UN-led peace process, but could not even The Obama administration had pushed in vain get all EU member-states on the same page, for progress in the Middle East Peace Process, let alone the warring factions in Libya. The hampered by a bad relationship with Israeli EU was backing the losing side in the fi ght Prime Minister Benjamin Netanyahu; Trump, who for political control in Libya, and its eff orts to has a much better relationship with Netanyahu, help the economy and to tackle migration had said that he wanted to strike the "ultimate deal", limited success. Meanwhile, Italy was supporting and put his son-in-law Jared Kushner in charge the UN-endorsed Government of National of achieving it. Trump's equivocal attitude to Accord (GNA), hoping inter alia that it would the two-state solution increased Palestinian help to control the fl ow of migrants across suspicions of his initiative, however, making a the Mediterranean; while France launched an breakthrough unlikely. But Trump's decision in initiative in July to bring together the GNA December to recognise Jerusalem as the capital and the rival military strongman Khalifa Haftar of Israel, fl ying in the face of decades of UN (perhaps believing that Haftar would be a more resolutions, has probably ensured that there useful partner in fi ghting Islamist extremism in will be no progress in the peace process for the Libya). By the end of the year the EU was trying foreseeable future. The close alignment between to work with both Libyan factions, but seemed Trump and Netanyahu will also ensure that the not much closer to solving the migration EU continues to have only marginal infl uence on problem or creating stability in Libya. In a policy Israeli policy. brief in November, Luigi Scazzieri and John Springford looked at the shift in EU migration Perhaps most seriously for the EU, relations policy from dealing with those who reach with Turkey, a member of NATO and a key Europe to working with countries of origin and partner of the EU in the Middle East, continued transit to prevent migrants getting that far. to deteriorate in 2017. The administration

13898 CER TEXT annual_report_2017 GB.indd 15 06/02/2018 11:12 of President Recep Tayyip Erdoğan became PKK, a group responsible for terrorist attacks in increasingly authoritarian. A controversial Turkey over several decades. Turkey's decision to constitutional reform, passed by a narrow buy an advanced Russian air defence system, the majority in April, added to European worries S-400, undermined NATO. Though formally EU about Erdoğan's tightening grip on power. accession talks with Ankara stagger on, support Ankara's diffi culties with the EU were matched by for them among member-states is getting harder its problems with Washington, which backed a to fi nd, with the new Austrian government calling Kurdish force in Syria closely associated with the in December for a freeze on further negotiations.

Asia The EU has struggled for many years to agree makers, and that North Korea's missile and on and pursue a strategic approach to Asia, nuclear programmes are seen by Beijing as and 2017 was no exception. In many respects it less of a threat to its interests than the collapse was a breakthrough year for China. In the same of North Korea. Trump showed considerable week of January that Trump took offi ce, decrying hostility to China during his election campaign, free trade and claiming that protectionism largely because of what he perceived as unfair would lead to "great prosperity and strength", Xi trade with the US. But during 2017 he veered Jinping was charming world leaders at Davos, between criticising China and threatening trade making the case for globalisation and against sanctions, and fl attering it while suggesting that trade barriers. One could question whether it could do more to rein in North Korea. On a Chinese treatment of foreign investors matched state visit to China in November, he turned from Xi's rhetoric, but there seemed little question blaming China for its trade surplus with the US to that China was consciously seeking to show its blaming American businesses; at the same time, support for the existing world trading system; he urged Xi to put more pressure on North Korea. though at the same time it clearly aspired to a bigger voice in international governance. The line from senior US offi cials at our Daimler Forum in December suggested that the administration is seriously considering a limited The Trump administration's erratic course should pre-emptive strike, designed to give North “ Korea's Kim Jong-Un a bloody nose, despite force the EU to increase its engagement with the risks; the US's priority is to stop Pyongyang traditional Asian partners and China. reaching the point at which its nuclear weapons ” can hit US soil. By the end of the year, China seemed to be getting more serious about the Xi's ambitious programme of infrastructure implementation of economic sanctions against investments along the so-called 'Silk Road North Korea; but it is not clear how Beijing would Economic Belt' from Western China via Central react if the US took military action. Asia and Russia to Europe, and the 'Maritime Silk Road' from China's coast to the Middle East, The EU and its member-states continued to East Africa and Europe, attracted 29 heads of neglect Asia's political and security problems, state or government (and representatives of seeing the continent mainly in terms of more than 100 other countries and international economic opportunities. Though the 2016 EU organisations) to Beijing in May. And, with his Global Strategy recognised a direct connection international prestige burnished, in October Xi between European prosperity and Asian consolidated his domestic power at the Chinese security, the annual report to the European Communist Party's 19th Congress. The question (for Parliament by the EU's High Representative Europe and the rest of the world, as well as China for foreign and security policy covered East, itself) is what he plans to do with this power. South and South-East Asia in just four of its 77 paragraphs. The Trump administration's This question is particularly pertinent in relation erratic course should force the EU to increase its to North Korea. Pyongyang carried out at least political engagement both with its traditional eight missile launches in 2017, including its fi rst partners including Japan, South Korea and inter-continental ballistic missile (ICBM) test, Australia, and with China. The 'Belt and Road on July 4th. It also appears to have successfully Initiative' may bring Europe and China closer tested a hydrogen bomb. together economically, but it also gives the EU an even greater stake in regional security issues The US has long assumed that China had the – and an increased interest in shaping China's ability to infl uence North Korean decision- activities in Europe.

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Russia and Eastern Europe ABOVE: (L to R) Sinan The EU's relations with Russia stayed stable and countries should be to increase their internal Űlgen and frosty in 2017. Russia's intervention in Ukraine resilience, including by cleaning up corruption Selim Yenel remained a stalemate. The confl ict continued at and strengthening the rule of law. a low level, with almost 200 Ukrainian soldiers CER/ECFR/ th killed, captured or missing in action during the In 2017 Europeans became more aware of the EDAM 13 year. Despite grumbling from some member- way that Russia seeks to undermine its perceived Bodrum states, the EU maintained sanctions against adversaries by non-military as well as military Roundtable, Russia, linked to its annexation of Crimea and means – though Russia's large and aggressive Bodrum subsequent intervention in the Donbass. 'Zapad' exercise in September showed that it was also increasing its military muscle in Europe. At the same time, concern about Russian One positive outcome of this awareness was the interference in Western domestic politics grew, opening of the European Centre of Excellence as there were more revelations from the US for Countering Hybrid Threats in Finland, with EU about Russian eff orts to infl uence the American and NATO backing. presidential election. Whatever the many investigations discover about possible criminal China's 'Belt and Road Initiative' gave Beijing activity by the Trump campaign, they and others an increased stake in the stability of Eastern have already uncovered a great deal about the Europe. In another policy brief in March, I way Russia cultivates individuals, plants fake argued that the EU should seek to build on stories in social media or exaggerates real stories, areas of common interest with China, as a to infl uence particular groups. way of hedging against Trump’s protectionist instincts. So far, the US administration has not In Europe, though Russian attempts to infl uence shifted its approach radically; and concerns elections in France, Germany and elsewhere have grown about whether China wants to be a did not succeed, the EU grew more concerned partner of the EU or to weaken it by cultivating about Russian operations in the Western (in particular) member-states in Central Europe Balkans, and the impact that they might have to promote its interests. But Europeans could on the EU enlargement process, as well as in suff er if, as Putin sometimes suggests, China Eastern Partnership countries including Georgia, and Russia worked together to restructure the Moldova and Ukraine. In a policy brief in March, existing international order. I suggested that the top priority for such

13898 CER TEXT annual_report_2017 GB.indd 17 06/02/2018 11:12 European defence All US presidents call for more burden-sharing and incompatible systems. If PESCO can help to from their European allies. Donald Trump has rationalise the European defence industry, invest taken it to extremes, however. He spurned in innovative technology, avoid cutting across several chances to restate the US commitment work in NATO and fi nd a way to involve the UK to NATO's Article 5 mutual defence guarantee, post-Brexit, then it will have achieved a lot. including at the NATO Summit in Brussels in May (he eventually said what needed to be said after The events and trends of 2017 are a reminder a bilateral meeting with the Romanian president that Brexit may be the all-consuming focus of in Washington in June). He repeatedly spoke in government in the UK, but it is far from being terms that implied that he thought European the centre of attention elsewhere. Nonetheless, allies should pay the US for their defence. Despite the UK has been a leading player in European Trump's views, however, the Pentagon increased foreign and defence policy, and (with France) its contribution to European defence during the one of the few internationally-minded member- year. A CER dinner in Brussels with NATO Deputy states. Much of the Brexit debate has focused Secretary General Rose Gottemoeller in June on future economic relations, but the UK and underlined the range of threats, military and the EU will both suff er if they do not fi nd ways non-military, that NATO allies face from Russia to work well together on security issues. While and other state and non-state actors. pro-Brexit fi gures sometimes suggest that the UK will be free to pursue an independent A combination of fear of the US losing interest foreign policy after March 2019, they can in Europe, worry about Russia's growing military seldom suggest which of the current policies capability, and the removal of British objections they would change. The CER has been working to European defence integration culminated with Germany's Konrad Adenauer Stiftung on a in December with the launch of 'Permanent series of workshops and publications examining Structured Co-operation (PESCO)' – a defence how to plug in the British on security, foreign club linking 25 EU member-states. The shape of and defence policy after Brexit. This project will the initiative refl ected a compromise between remain an important part of our work in 2018. France, which had wanted to limit PESCO to a smaller group of countries willing and able to invest in defence and take part in demanding operations, and Germany, which wanted a more political PESCO with a larger number of states. There are good reasons for EU member-states to work together more closely: Europe has far too many small national defence equipment Ian Bond programmes, resulting in wasteful spending Director of foreign policy, CER

13898 CER TEXT annual_report_2017 GB.indd 18 06/02/2018 11:12 ANNUAL REPORT 2017 February 2018 19 [email protected] | WWW.CER.EU CER events 2017 11 January 24 March Breakfast on 'Article 50 and the best Launch of three publications on possible deal on Brexit' 'Russia and its neighbours: Competition, with Keir Starmer, London co-operation and confl ict' with Steven Everts and Amanda Paul, Brussels 24 January Dinner on 'What future for Europol?' with Rob Wainwright, London 28 March (top right) CER/RIAC launch of three publications on 'Russia and its neighbours: Competition, co-operation and confl ict' 30 January with Andrei Kortunov, Moscow CER/Kreab breakfast on 'A plan for Europe's neighbourhood' with Johannes Hahn, Brussels 29 March Breakfast on 'Has Europe solved its migration crisis or have we just 1 February forgotten about it?' Dinner on 'Making a success of the EU's with Raoul Ueberecken, Brussels security union' with Julian King, London (second from top, right) 29 March CER/Jacques Delors Institut – Berlin roundtable on 'Who pays for Brexit?' 2 February with Alex Barker and Jörg Haas, Berlin CER/Kreab breakfast on 'How to found EU policy-making on scientifi c evidence' with Carlos Moedas, Brussels 11 April CER/Kreab breakfast on 'The future of EU 9 February trade policy' Breakfast on 'Britain and the World Trade with Cecilia Malmström, Brussels Organisation' with Julian Braithwaite, London 20 April CER/Notre Europe – Institut Jacques 21 February Delors roundtable on 'Brexit and the EU CER/Kreab breakfast on 'Can the euro budget' area work without political union?' with Alex Barker and Eulalia Rubio, Paris with Poul Thomsen, Brussels 25 April 6 March CER/Kreab breakfast on 'How to Launch of 'Parliamentarians in Brexit strengthen the European defence talks: Bulls in a china shop?' market' speakers included: Seb Dance, Sylvie with , Brussels Goulard (middle, right) and Jennifer (second from bottom, right) Rankin, Brussels 25 April 15 March CER/Quilliam roundtable on 'The future CER/Jacques Delors Institut – Berlin of European counter-terrorism policy: discussion on Brexit and the EU budget What next after Brexit and Trump?' with Alex Barker and Jörg Haas, Brussels speakers included: Sean Arbuthnot, Julia Ebner and Ghaff ar Hussain, London (bottom, right) 20 March Launch of three publications on 'Russia and its neighbours: Competition, 27 April co-operation and confl ict' Brookings/CER/SWP Daimler US- with Jonathan Fenby and Kataryna European Forum on Global Issues Wolczuk, London speakers included: Markus Ederer, Martin Wolf, Andreas Michaelis, Robert Kagan and Victoria Nuland, Berlin

13898 CER TEXT annual_report_2017 GB.indd 19 06/02/2018 11:12 4 May with Stefaan De Rynck and Heather Launch of 'Parliamentarians in Brexit Grabbe, Brussels talks: Bulls in a china shop?’ with John Peet and Joyce Quin (top, left), London 12 September CER/Cliff ord Chance lunch on 'The future of tax competition in Europe' 4-6 May with Gert-Jan Koopman and Pascal Saint- CER/East Offi ce/AIG Arctic Bridge Amans, Brussels Summit speakers included: Esko Aho, Richard 13 September Barrons, Elisabeth Braw, Pauline Neville- Conference on 'The German election: Jones and Andrey Zagorskiy, Levi Implications for Europe' speakers included: Jochen Andritzky, 10 May Michael Arthur, Christine Ockrent (middle, CER/Kreab breakfast on 'Digital left) and Peter Ptassek, London challenges for transport markets in Europe' 18 September with Henrik Hololei, Brussels CER/IIEA launch of 'Ulster's fi ght, Ulster's rights? Brexit, Northern Ireland and the 10 May threat to British-Irish relations' Seminar on 'Brexit: Why Britain voted to with Edward Burke, Dublin leave the European Union' with Florence Faucher, Matthew Goodwin 22 September and Paul Whiteley, Brussels CER/Kreab breakfast on 'The future of Europe' 15 June with Martin Selmayr, Brussels Dinner on 'The strategic challenges facing Europe' 25 September with Rose Gottemoeller, Brussels Labour Party Conference fringe event on 'How to handle Brexit' with Hilary Benn, Yvette Cooper, Keir 26 June Starmer and Chuka Umunna, Brighton Roundtable on 'Scotland, Brexit and the future of the EU' with Michael Russell, London 26 September Launch of 'Brexit and energy: Time to make some hard choices' 26 June with Philip Lowe, London (second from CER/The Briefi ng Circle dinner on bottom, left) 'Europe’s digital economy' with , London 2 October Conservative Party Conference fringe 27 June event on 'How to handle Brexit' Fifth meeting of the Amato Group on with Vicky Ford, Dominic Grieve, Andrea 'Are Libya and Tunisia Europe's own Leadsom (bottom, left), Juliet Samuel and Nauru island? The 'off shoring' of EU Konrad Szymański, Manchester asylum and migration policies' with Giuliano Amato, Eugenio Ambrosi, Sophie Magennis and Fransje Molenaar, 6-8 October Brussels CER/ECFR/EDAM 13th Bodrum Roundtable speakers included: Mehmet Şimşek, Kati 14 July Piri, Kori Schake, Nathalie Tocci, Yaroslav Breakfast on 'The key issues in the Brexit Trofi mov and Selim Yenel, Bodrum negotiations' with Keir Starmer, London (second from top, left) 13 October Launch of 'Brexit and energy: Time to make some hard choices' 26 July with Philip Lowe, Brussels CER/OSEPI launch of 'Brexit maze: The role of EU institutions in the negotiations'

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17 October 27 November 19th birthday party Breakfast on 'Britain's relations with with a keynote speech by Nick Clegg (top, Europe after Brexit' right), hosted by Ambassador Torbjörn with Damian Green, London Sohlström, London 30 November 23 October CER/KAS roundtable on 'Plugging in the CER/KAS roundtable on 'Plugging in the British: EU defence policy' British: EU foreign policy' speakers included: Malcolm Chalmers, with Alan Bowman, Victoria Nuland, Bård Robert Cooper, Nicole Koenig, Tom Holter, Vandvik and Pierre Vimont, London Angus Lapsley and Tim Lawrenson, Berlin

25 October 30 November Breakfast on 'The state of the Brexit CER/GMF launch of 'Relaunching the EU' negotiations' with Charles Grant and Luca Di Preso, with Ivan Rogers, London Washington (second from top, right) 30 November-1 December 3-4 November Brookings/CER/SWP Daimler US- Conference on 'How to save the EU?' European Forum on Global Issues speakers included: László Andor, Marco with Thomas Bagger, Brian Hook, H.R. Buti, Barry Eichengreen (middle, right), McMaster, Wess Mitchell, Karen Pierce, François Heisbourg, Catherine Mann, Matthew Pottinger and Nicolas de Rivière, Luuk van Middelaar, Yascha Mounk, Washington Tomáš Prouza, Norbert Röttgen, Ludger Schuknecht, Brad Setser, Constanze 8 December Stelzenmüller, Poul Thomsen, Paul Tucker, Launch of 'A new deal for the eurozone: Adair Turner, Jordi Vaquer, Stefanie Walter Remedy or placebo?' and Jeromin Zettelmeyer, Ditchley Park with Alan Beattie, José Leandro, João Nogueira Martins and Shahin Vallée, 16 November Brussels (bottom, right) Launch of 'Relaunching the EU' with Jean-Pierre Jouyet, London 19 December CER/Polityka Insight launch of 'A new 20 November deal for the eurozone: Remedy or Conference on 'The future of the EU' placebo?' with a keynote speech by Michel Barnier. with Marek Belka, Lucas Guttenberg and Speakers included: Luis Garicano, Hélène Fabrice Lenglart, Warsaw Rey (second from bottom, right), Martin Sandbu, John Bruton, Monique Ebell, Peter Mandelson, Jean-Claude Piris, Sophie Magennis, Jonathan Portes, Monika Sie Dhian Ho, Raoul Ueberecken, François Heisbourg and George Robertson, Brussels

22 November Launch of 'Can EU funds promote the rule of law in Europe?' with Carl Dolan, Frank Engel, Heather Grabbe and Jasna Šelih, Brussels

22 November CER/Embassy of Ireland launch of 'Ulster's fi ght, Ulster's rights? Brexit, Northern Ireland and the threat to British-Irish relations' with Edward Burke, Caoilfhionn Gallagher and Carolyn Quinn, London

13898 CER TEXT annual_report_2017 GB.indd 21 06/02/2018 11:12 CER publications 2017

What free movement means to Europe and why it matters to Britain policy brief by Camino Mortera-Martinez and Christian Odendahl January 2017 Parliamentarians in Brexit talks: Bulls in a china shop? policy brief by Agata Gostyńska-Jakubowska February 2017 The €60 billion Brexit bill: How to disentangle Britain from the EU budget policy brief by Alex Barker February 2017 Mrs May's emerging deal on Brexit: Not just hard, but also diffi cult policy brief by Charles Grant February 2017 Contested space: Eastern Europe between Russia and the EU policy brief by Ian Bond March 2017 The EU, the Eurasian Economic Union and One Belt, One Road: Can they work together? policy brief by Ian Bond March 2017 Berlin to the rescue? A closer look at Germany's position on Brexit policy brief by Sophia Besch and Christian Odendahl March 2017 Brexiting Swiss-style: The best possible UK-EU trade deal policy brief by John Springford April 2017 Unfreezing TTIP: Why a transatlantic trade pact still makes strategic sense policy brief by Rem Korteweg May 2017 Trump, Europe and the Middle East peace process: A path out of the quicksand policy brief by Luigi Scazzieri June 2017 Brexit maze: The role of EU institutions in the negotiations policy brief by Agata Gostyńska-Jakubowska July 2017 Ulster's fi ght, Ulster's rights? Brexit, Northern Ireland and the threat to British-Irish relations policy brief by Edward Burke July 2017 The Hartz myth: A closer look at Germany's labour market reforms policy brief by Christian Odendahl July 2017 Brexit and energy: Time to make some hard choices policy brief by Philip Lowe September 2017 How the EU and third countries can manage migration policy brief by Luigi Scazzieri and John Springford November 2017 Relaunching the EU report by Charles Grant with Sophia Besch, Ian Bond, Agata Gostyńska-Jakubowska, Camino Mortera-Martinez, Christian Odendahl, John Springford and Simon Tilford November 2017 Can EU funds promote the rule of law in Europe? policy brief by Jasna Šelih with Ian Bond and Carl Dolan November 2017 A new deal for the eurozone: Remedy or placebo? policy brief by Agata Gostyńska-Jakubowska November 2017

13898 CER TEXT annual_report_2017 GB.indd 22 06/02/2018 11:12 ANNUAL REPORT 2017 February 2018 23 [email protected] | WWW.CER.EU CER staff 2017

Charles Grant is the director. His interests include Britain's relationship with the EU, European institutions, European foreign and defence policy, Russia and China.

Simon Tilford was the deputy director. He focused on competitiveness, macroeconomics, economic reform and the euro.

John Springford is the deputy director. He specialises in Britain's relationship with the EU, the single market, international trade and the economics of migration.

Ian Bond is the director of foreign policy. He specialises in Russia and the former Soviet Union, European foreign policy, Europe-Asia relations and US foreign policy.

Christian Odendahl is the chief economist & Berlin representative. He focuses on macroeconomics, the eurozone, the European Central Bank and Germany. He also covers trade and fi nancial markets.

Rem Korteweg was a senior research fellow. He worked on transatlantic, Europe-Middle East and Europe-Asia relations, the geopolitics of energy, trade, and security and defence policy. Agata Gostyńska-Jakubowska is a senior research fellow. She specialises in the EU's institutions and decision-making process, Poland's European policy and Britain's relationship with Europe.

Camino Mortera-Martinez is a research fellow & Brussels representative. She specialises in justice and home aff airs, migration, internal security, privacy, criminal law and police and judicial co-operation. Sophia Besch is a research fellow. She specialises in NATO, European defence and German foreign policy.

Luigi Scazzieri is a research fellow. He specialises in European foreign and security policy, the Middle East and Russia.

Noah Gordon is the Clara Marina O’Donnell fellow (2017-18). The fellowship is aimed at those at the start of their careers who are interested in foreign, defence and security policy.

Beth Oppenheim is a researcher. She focuses on Brexit and trade.

13898 CER TEXT annual_report_2017 GB.indd 23 06/02/2018 11:12 Nick Winning is the media offi cer & editor. He is responsible for the CER’s media coverage and strategy and edits research.

Kate Mullineux is the publications manager & website editor. She designs CER publications and organises their production and is responsible for managing all website content.

Sophie Horsford is the fundraising & operations manager. She is responsible for the day-to-day management of the CER, particularly fi nance and fundraising.

Jordan Orsler is the events manager. She is responsible for the planning and execution of the CER's conferences and roundtables.

Bea Dunscombe is the administrative assistant & PA to Charles Grant. She is the fi rst point of contact for visitors to the CER and supports the work of researchers.

Lucy Slade is the events intern. She assists with the co-ordination and administration of CER events.

Anna Yorke was the press & communications co-ordinator. She was responsible for the CER’s communications strategy and press enquiries.

Daniel Crewes was the administrative assistant. He was the fi rst point of contact for visitors to the CER, and assisted with events and general administration.

13898 CER TEXT annual_report_2017 GB.indd 24 06/02/2018 11:12 ANNUAL REPORT 2017 February 2018 25 [email protected] | WWW.CER.EU Advisory board 2017

Paul Adamson Caio Koch-Weser Chairman of Forum Europe and founder and editor Chairman of the board, European Climate of E!Sharp Foundation Esko Aho Sir Richard Lambert Executive chairman of the board, East Offi ce of Chairman of the British Museum and former Finnish Industries and former prime minister of director-general of the Confederation of British Finland Industry Joaquín Almunia Pascal Lamy Former vice president and competition President emeritus, Jacques Delors Institute commissioner, Sir Philip Lowe Carl Bildt Former director-general for energy, European Former prime minister and foreign minister of Commission Sweden Nick Butler Dominique Moïsi Visiting fellow and chairman, King’s Policy Institute Senior counselor, Institut français des relations at King’s College London internationales Tim Clark Lord Monks Former senior partner, Slaughter & May Former general secretary, Trades Union Congress and European Trades Union Confederation David Claydon Co-founder and co-chief executive offi cer, Mario Monti Macro Advisory Partners President, Bocconi University and former prime minister of Italy Iain Conn Group chief executive offi cer, Centrica Christine Ockrent Commentator and writer, and producer of Aff aires Sir Robert Cooper Étrangères, France Culture Former special adviser to the High Representative and former counsellor, EEAS Michel Petite Lawyer Of Counsel, Cliff ord Chance, Paris Jonathan Faull Chair, European Public Aff airs, Brunswick Group Lord Robertson Deputy chairman, TNK-BP and former secretary- Stephanie Flanders general, NATO Senior executive editor and head of Bloomberg economics, Bloomberg Roland Rudd Chairman, Finsbury and Open Britain Timothy Garton Ash Professor, European Studies, University of Oxford Dev Sanyal Chief executive alternative energy and executive Sir John Grant vice president, regions, BP plc Vice president, international government relations, Anadarko Petroleum Corporation Kori Schake Hoover fellow and distinguished professor at Lord Hannay West Point Former ambassador to the UN and the EU Sir Nigel Sheinwald Lord Haskins Non-executive director, Royal Dutch Shell plc and Chair, Humber Local Enterprise Partnership and visiting professor, King’s College London former chairman, Northern Foods Lord Simon François Heisbourg Senior advisor, MWM and chairman of the advisory Special adviser, Fondation pour la Recherche board, Montrose Stratégique Lord Turner Simon Henry Chairman, Institute for New Economic Thinking Independent director Pierre Vimont Susan Hitch Former executive secretary-general, European Manager, Lord Sainsbury of Turville’s pro bono External Action Service projects Sir Nigel Wicks Wolfgang Ischinger Former chairman, British Bankers’ Association Chairman, Munich Security Conference Igor Yurgens Lord Kerr (chair) Chairman, Institute for Contemporary Vice chairman, ScottishPower Development, Moscow

13898 CER TEXT annual_report_2017 GB.indd 25 06/02/2018 11:12 Financial support 2017

In addition to our corporate members, numerous other companies have supported specifi c publications, projects and events.

0-10K

Daily Mail and General Trust Nomura

11-20K

Airbus Group Ltd Kingfi sher Allen & Overy LLP KPMG BAE Systems Lloyds Banking Group Barclays Macro Advisory Partners BDO Global Merifi n Foundation Boeing Montrose Associates British Telecommunications NM Rothschild & Sons Cliff ord Chance LLP North Asset Management Deutsche Bank SecureValue Consulting Ltd Fidelity Worldwide Investment Standard Chartered Ford of Europe The Economist Gilead Sciences International Vanguard Goldman Sachs International Vodafone JP Morgan

21-50K

AIG Europe Ltd Invesco Perpetual Apple Microsoft AstraZeneca Morgan Stanley Bayer AG MSD Europe Inc BHP Billiton plc Porta Advisors BP International Limited PwC Centrica Qualcomm EDF Energy Rio Tinto GlaxoSmithKline Services Unlimited Siemens HSBC Holdings plc Shell International Limited IBM Statoil International Paper

13898 CER TEXT annual_report_2017 GB.indd 26 06/02/2018 11:12 ANNUAL REPORT 2017 February 2018 27 [email protected] | WWW.CER.EU Financial information

Audited accounts for year ending 31.12.2016

Income for 2016: Total £1,257,378 Donations Projects & events

Expenditure for 2016: Total £1,352,050 Staff Administration & travel Events Publishing

13898 CER TEXT annual_report_2017 GB.indd 27 06/02/2018 11:12 Centre for European Reform The Library Ambiorix, www.cer.eu 14 Great College Street Square Ambiorix 10 [email protected] London Brussels @CER_EU SW1P 3RX B-1000 © CER 2018 Tel: + 44 (0) 207 233 1199 Tel: + 32 (0) 2 899 9144

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CENTRE FOR EUROPEAN REFORM

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