Stubb: Europe will bounce back

Photo: Mihkel Maripuu

Former Finnish prime minister, Vice President of the European Investment Bank Alexander Stubb, who refers to himself as a European Union geek, sees Brexit and the Trump presidency as consolidating effects for the EU.

You were in Tallinn for the Baltic Sea Strategy annual forum that looked at the region after 2020. What are the major challenges countries here face?

They are the same in any region: security, technology, environment, economic growth etc.

I believe it is good that we meet to discuss these topics. I’m secretly proud of the initiative Toomas Hendrik Ilves and I undertook back in 2006 and that later became a European Parliament initiative. It is good to see so many people looking for common solutions to problems together.

Many Baltic Sea states have a common problem – the one country that is not part of the strategy, namely Russia. How should the EU, but especially countries in the region, approach this problem?

I’ve always been a supporter of purposeful approach, so I believe cooperation is the best path. Of course, there are situations where this approach is limited.

For example, because of Russia’s actions in the Crimean Peninsula or Ukraine, there are certain rules we must follow in dealing with Russia. Cooperation is unfortunately limited today, and with good reason. At the same time, cooperation is pursued on the micro level, for example in environmental matters.

Your main task at the EIB is thinking about Europe’s future and development. The looming departure of the UK heralds major changes for the EU. Where is the union headed?

I believe Europe will bounce back. We went through a difficult phase between 2008 and 2016.

Paradoxically, Brexit was a wake-up call for many of us. We realized that if we cannot produce results, if we cannot contain the debate, explain how Europe works better, if people do not feel they belong in Europe, then we will see other member states leave.

Brexit created a kind of united front and brought Europe together in a way I have not seen before during my academic, public, or political career in Europe.

It did not matter which international conference or discussion you attended in 2008-2016, the European Union was a laughing stock: we were told the euro is not sustainable, that the union would fall apart etc. The tone has changed completely now as many countries see the EU doing pretty well.

The EU budget plan is a divisive factor unfortunately.

Arguments surrounding the budget plan are especially sharp right now as Brexit will leave a hole in the union’s budget the European Commission expects other member states to patch. How to soften that debate?

Every time you talk about money, and especially how it’s distributed, it’s a divisive factor. We can see it on the level of countries too. The European Commission is something of a finance minister in its attempts to distribute funds.

Some experts say Brexit will create a dent of €12-14 billion a year in the budget. We have to repair it somehow. Naturally, this means there will be winners and losers.

The new plan also includes a proposal to tie qualifying for EU funding to democratic values. Do you believe it is a good measure with which to call member states to order?

I’m just a lowly banker, so I will not take a political stand in this matter. However, it was interesting to see the balancing act the commission pulled off by presenting two somewhat opposite proposals. I believe the commission has come up with some interesting ideas.

Is liberal democracy still a common value shared by all EU member states?

It is endangered everywhere in the world. I always mention three key moments in the past 30 years. First, when our values won in 1989. Then we have 2008, when we had the collapse of Lehman Brothers and war in Georgia – our values came under fire. And thirdly, the year 2016 that brought Brexit and Trump – that was the final assault in some respects.

That is why we are seeing some confusing election results, a lot of populist parties. Europe is very successful in creating growth and jobs, while it is not very good at equal distribution of income or wealth, and it is something we need to work on.

When people do not feel they get their fair slice of the pie, when income inequality is growing, people are rightly disgruntled.

Donald Trump becoming U.S. president has meant that the relationship between the USA and the EU has not been as predictable recently. How has Trump affected the EU?

Paradoxically enough, Trump is a consolidating factor in Europe. We are seeing it in trade, and I’d say we are also experiencing it when it comes to values. I have never seen European hearts beating as strongly as they do now.

The popularity of the EU is greater than ever in polls which I am glad to see. Naturally, it also has to do with economic cycles: people like the EU more when the economy is doing well and less when it is in trouble.

I believe that a lot of people recognize – whether they are pro or against the EU – its necessity as a creator of prosperity and jobs.

Trump has been a consolidating factor, as has Brexit. When the latter happened, a lot of people thought of their country and asked themselves: “Do I really want this?” If we leave aside radicals, the answer to that question is: “No, I don’t!” It is better to find a way to cooperate than it is to split up.

What could be the best deal for the EU and the UK that is still realistic today?

Leaving aside details of free movement, the customs union, and jurisdiction of courts, two things matter above all. Firstly, the agreement needs to be friendly and achieved in a civil manner, without trench warfare and accusations. Secondly, the UK needs to remain as close to the EU as possible.

Of course, I was always against Brexit and still am, but if it becomes reality, we will still be connected through our economy, trade, values, and security. It would be foolish to ruin relations.

I believe the United Kingdom will end up somewhere between Norway, Switzerland, and Canada when it comes to its status, maintaining a special relationship with the EU.

As a supporter of NATO, do you believe Finland will join the alliance?

Everyone knows where I stand on NATO. We should have joined in 1995.

I believe Finland will join NATO eventually, but I have no idea when. I do not want to say I’ve lost hope, but it seems to be taking a long time. If one is against NATO, one can always resort to the argument of bad timing.

But I always say thank God the Baltics are NATO. The fact that Estonia, Latvia, Lithuania, but also Poland, Norway, Denmark, and of course Germany are part of NATO has created an impenetrable security umbrella over the Baltic Sea. We should be tankful in Finland and Sweden.

Finland is heading into parliamentary elections next year. How do you see Finnish politics now that you are no longer actively part of it?

I made a conscious choice not to partake in the political debate in Finland two years ago. On the one hand, I wanted to protect myself and my family, and secondly, as former prime minister, everything I said would be interpreted by the Finnish media as criticism of current decisionmakers.

The thought of entering the public debate in Finland again makes me feel uncomfortable. Foreign and security policy is the only exception – I do have something to say about that from time to time.

Next spring will also see European Parliament elections. Do you plan to run?

I’m a former politician. I’ve said in Finland that should I run for the European Parliament it would be on my way to the commission.

I’m convinced that if we want a more democratically legitimate European Union, it would be good to have prospective commissioners also run for the European Parliament, as it is with national elections: first, you run in the election and only then can you become a minister. That is the only condition under which I would run.

However, there are a lot of obstacles on that path, so it is not something I’m really thinking about.