Brussels Summit: Consensus Left Off The Table

European leaders have met in Brussels to discuss a number of issues including the eurozone crisis, Serbia’s bid to join the EU and the expansion of the Schengen zone. But there was not much unity on how exactly to salvage the eurozone.

­The main tactical arguments all boiled down to the issue of growth versus austerity. While German Chancellor Angela Merkel has been a long-term proponent of austerity, a number of politicians have recently questioned the approach, saying it could undermine recovery. EU Parliament’s President Martin Schulz, a German Social-Democrat, noted that for too long, crisis management “has erred too far toward austerity.”

British Prime Minister David Cameron, backed by his Italian and Dutch colleagues Mario Monti and Mark Rutte, complained that a draft statement paid far too little attention to a proposal by twelve EU leaders to increase market deregulation in order to boost economic dynamism.

But European Commission Chairman Jose Manuel Barroso said the real problem lay with countries’ failure to implement agreed-upon reforms. He also stressed the need to concentrate on developing the EU’s internal market, and noted that the EU was entering a new phase of economic regulation.

Mariano Rajoy, Spain’s new prime minister, has been pleading for the EU to ease its strict budget deficit limits and set more realistic targets for his country, where the deficit hit 8.5 per cent of GDP this week, far above the 6 per cent target set by Brussels. But Barroso and Finnish Prime Minister Jyrki Katainen were quick to reject such a plea, saying it was wrong to give any particular country leeway on meeting its fiscal targets.

Herman Van Rompuy, who secured a second term as European Council President during the summit, summed up the main issues. The first was how fiscal discipline could be combined with growth and employment stimulation; another was how to improve internal competitiveness.

Van Rompuy also spoke about the decision to grant Serbia candidate member status.

“This is a remarkable achievement, a result of the efforts demonstrated by both sides in the dialogue between Belgrade and Pristina.”

Serbia applied for membership back in 2009, but its bid was stalled because of its lack of progress in talks with Kosovo and its failure to hand over men accused of war crimes by the International Criminal Court. In 2011 Serbia captured and extradited Ratko Mladic and Goran Hadzic, who were on the court’s most wanted men list, although Germany opposed the approval of its candidacy back in December due to stalled progress on Kosovo.

Finally, Van Rompuy said a “road map” for Romania’s and Bulgaria’s entry into the Schengen zone had been agreed upon, and that the EU’s Justice and Home Affairs Council is set to decide on the matter in September. The countries’ previous bids to join the zone had been opposed by the Netherlands, Germany, France and Finland, who argued that Romania and Bulgaria still needed to improve their border controls and justice system.

A budget pact, which is set to impose tighter fiscal controls from Brussels, is expected to be signed on Friday.