Values and transparency

The new Commission faces a complex European political landscape. Eurosceptic parties from many member states will put pressure on their governments after performing strongly in May’s European Parliament election, even if they are struggling to translate this into power in the parliament itself. Tensions have increased between eastern and western member states on migration and non-discrimination in areas such as LGBT rights and on the rule of law and corruption. Older members of the Union are deeply uncomfortable with allowing divergence from what they see as core EU liberal principles. However, some eastern members clearly want to rally around what they see as important socially conservative principles.

This will be a difficult tension to de-escalate. Brussels is likely to continue to appeal to the younger generation in newer member states with an emphasis on the single market and youth mobility while ratcheting up pressure for their governments to unwind steps taken to exert control over the media and the judiciary. Governments in Poland and Hungary in particular have become adept at using a mix of anti-Brussels and anti-Berlin rhetoric and large scale social welfare to shore up their electoral coalitions. There is also some truth in their complaint that they have sometimes been treated as second-class member states when Paris and Berlin have hammered out their preferences for the Union, and this will be a perception that this Commission and incoming Council President, Charles Michel, will need to address.

These rifts may yet have consequences for investors. Investment has been pulled to the EU’s new member states by competitive wages and stable and rapid spending growth. Despite being concerned – in private and in public - about anti-LGBT sentiment in Poland, a crackdown on the foreign-funded third sector in Hungary, or the seemingly perennial problem of corruption in Romania, international businesses remain attracted to the region. But a growing strain of national preference and suspicion of outside – even western European - influence could easily develop into something more openly discriminatory, even if EU law nominally forbids it.

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This blog was written for Global Counsel's panel discussion on the new European Commission in 2019 and forms a part of a wider briefing pack.