Speech by Mr Jukka Valtasaari, Secretary of State: Finland and the EU Presidency, Zagreb 17th May 1999

At the Diplomatic Academy of the MFA of the Republic of Croatia, Zagreb, 17 May 1999

Mr. Jukka Valtasaari,
Secretary of State,
Ministry for Foreign Affairs of Finland

I would like to thank the organisers of this seminar for inviting me to speak about the Finnish EU Presidency.

I am here at a particularly important moment in the history of Europe and that of the Union. The Kosovo crisis has clearly shown us the importance of dialogue and co-operation in Europe. In this task diplomats of every European nation will play a key role. We still have a lot to do; that is, Europe together with other global actors will have a lot to do.
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Finland has been member of the EU for four and a half years now.
Our experience of membership has been in many ways positive.

EU membership in general and the euro in particular have brought Finland economic stability. This has had a positive influence on inflation and interest rates. It has been important for us to be able to sit at the table where the matters that can have a significant impact on our economy are decided. All the nations of this continent are becoming more and more interconnected and thus interdependent.

We believe that the EU too has gained from its last enlargement.
The Union´s area of interest has widened. All member states and the Union as a whole are more than ever before aware of the Nordic areas of Europe; The Northern dimension of the Union has emerged geographically and conceptually.

Our accession to the Union went smoothly and the majority of Finns are today in favour of EU membership. This is a good starting point for our Presidency.
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The rotating Presidency provides an opportunity for each EU member to take a fresh look at the Union´s traditional agenda at regular intervals.

Now it is our turn. Less than two months from now, Finland will assume the Presidency of the Council of the European Union for the first time.

We have taken this task very seriously indeed. We have prepared ourselves to chair about 3,000 meetings, most of which will be held in Brussels, with some in Luxembourg, Finland, New York and Geneva. In these meetings we must master the substance of certain issues that we had the liberty to take more superficially until now. Moreover, we have been thinking about the type of leadership that can be reasonably exercised by a small country.

Unlike most continental European nations, the Finns never had the time or the resources to develop heavy bureaucratic structures, nor have they any liking for them. Finns adopted the principles of flat organisation. An individual in a Finnish organisation is expected to use his or her common sense, will be given a lot of freedom and is fully responsible for the way it is used. The Presidency is like a game where all the players must be well prepared and must trust each other.

It is also important to remember that small countries, which cannot assume that their values are automatically shared by others, must blend their national priorities with regional, continental or even global ones. In other words, leadership requires that others perceive the country in the leadership role as a relevant actor and a credible partner. We must consistently promote policies that represent the interests of all members.

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Obviously, internally the most important task of the Presidency is to be an efficient and honest leader in the service of the EU, and in this role to push forward the Union´s internal and external agendas.

In parallel with this internal function of the Presidency, we must also play on the global stage. What is the perception of the Union isn the world at large? The economic and political success of the Union as an actor among other big actors such as the USA, Asia or Africa will depend on the capability of the member states to agree among themselves and - following this - on their capability to co-operate with the outside world. More about this later.

Now I will go back to the internal agenda. What will this agenda look like? Let me give you a brief outlook.

First, we want to contribute to a successful enlargement of the Union. It is a task of historic proportions and it needs to be completed if we want a unified Europe without political or economic fault lines.

The tragedy in the Balkans demonstrates that EU enlargement - involving commitments both by the members and the applicants - must be pursued vigorously. If not, there is a risk that former political divisions will be replaced by economic ones and that our resolve to bring about a unified Europe will be seriously questioned.

Promoting the enlargement process is one of the most important tasks of the Finnish Presidency. This will demand persistent work from all partners: from the applicant countries themselves, from the 15 member countries, including us, and from the Commission. The agenda for enlargement during the Finnish Presidency is going to be heavy. Many subject matters are rather technical in nature, and others are sensitive, arousing much interest and expectations in the applicant countries.

Still, the first test may be the re-establishment - after the war - of stability in the Balkans and the reconstruction of the economies of the region. A number of proposals, including a stability pact (the equivalent of a new Marshall Plan) and a big-scale peace conference, have been mentioned. The task will be daunting.

Second, we want to achieve significant progress in justice and home affairs. What do citizens think of the Union? What difference does the Union make to them? Do they feel its impact as a positive force for good in their daily lives?

Topics such as money laundering, trafficking in drugs and people and other crimes are of great concern to our citizens. European-level cooperation on these global issues is vital.

Within the Union, well-being and prosperity are to a large extent dependent on the mobility of production factors. Free movement of persons is in its turn closely linked to smooth judicial cooperation among member states. To move from one’s own country to another, in a multicultural and multilingual union, is difficult enough. It should be made easier by establishing similar or at least predictable legal procedures, regarding visas, immigration, border control and legal protection in different parts of the Union.

Third, Europe needs stable economic growth and the right conditions for business to function.

Implementation of the final stage of Economic and Monetary Union at the beginning of 1999 has affected EU activities. The transition to a single currency and common monetary policy is a fundamental step in the Union´s history. The Union´s visibility is rapidly increasing. The euro is also on the global scale one of the driving forces. For some, its is perhaps only now that Europe has become a truly integrated continent.

The introduction of the euro has also created completely new pressures for Member States to coordinate the rest of their economic policy as well. When the euro was introduced those countries participating gave up their monetary policy, which traditionally was one of the tools to smoothen cyclical fluctuations. The euro has thus linked the economies of the 11 Member States more closely together. They will share a single monetary policy and a single exchange rate. Economic policies and wage determination, however, remain national responsibilities. To the extent that national economic developments have an impact on inflation prospects in the euro area, they will influence monetary conditions in that area. It is for this basic reason that the move to a single currency will require closer Community surveillance and co-ordination of economic policies among euro-area Member States.

Low growth rates in the EU show that there is still work to do. We must work on competitiveness, on the smooth functioning of the internal market and on new technologies. Job-creation is possible only by improving the environment in which companies function. Only companies can create permanent jobs. It seems to be that in a world where capital and production processes are mobile, industries move and governments deal with consequences.

Fourth. External relations.

We Finns give particular attention to the Union´s external affairs. It is crucial that the Union brings more coherence to its common foreign and security policy. And, as I said at the beginning of my speech, we must here keep in mind the other significant global actors: the USA and the whole vast transatlantic dialogue, Asia, Africa, The Middle East and so on.

The EU´s external agenda is not that much different from the global agenda in the field of foreign policy. Roughly the same topics are discussed in several international forums: in the UN, NATO, the OSCE...One of these topics - apart from Kosovo of course - is Russia.

The current Presidency - held by Germany - is preparing the first common strategy on Russia. Immediately after the adoption of the Russia common strategy at Cologne, we will submit an implementation plan. This will emphasise the rule of law in general and the safe production of nuclear energy in particular. Finland will also start to work out the next common strategies - whatever they will be.

The policy of the Northern Dimension of the Union will be further refined during our Presidency. There will be a special ministerial meeting in November. The Northern Dimension is based on four assumptions.
- First, with the accession of Finland and Sweden, the EU acquired a common border with Russia.
- Second, western institutions such as the EU and NATO are extending eastwards, while the centre of gravity of post-Soviet Russia has moved north-west.
- Third, nearly half of Russia´s export transit routes are in the Baltic Sea area.
- Fourth, most of Russia´s raw materials, including its energy resources, are in the north.

In our view, the agenda of the Northern Dimension of the EU combines regional, European-wide and global interests. It also offers an opportunity to identify long term joint interests and the potential of Russia. It also permits us to avoid the worst in the short term.

One conclusion from Amsterdam was that there is no excuse for being slower or sloppier in our collective foreign policy than in our national ones, if we want Europe as a political actor to be taken into account and not taken for a ride.

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Finland is a small country. And small steps have always been the Union´s way of approaching issues. No doubt this will continue and offer even small countries a good opportunity to lead, provided they get the big picture right.