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Daniel Mondekar: Deepening Integration Will Solve Euro Area Problems

Published on , , Zagreb, Twitter: @AdelinaMarini
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“The Greek crisis taught us that there needs to be more fiscal and political responsibility”, said in an interview for euinside the Chairman of the European Affairs Committee in the Croatian Parliament, Daniel Mondekar. In his opinion, it is the easiest to say that the Germans are to blame for the Greeks’ hardships. What is expected of Greece, however, can also be seen in the recommendations to countries like Bulgaria, Romania, Croatia, and Hungary. It is about totally normal things like a well established health-care system. The difficult situation in some countries is caused by irresponsible governance. This will be solved by deeper integration, for with it countries will learn that they are not lonely islands that care about nothing. “The deeper integration will have that butterfly effect, which could really, if there are able and responsible politicians, have a multiplied effect on a state level”, added the young Social Democrat. 

My conversation with him was on September 18th,  at a moment when European subjects in Croatian public space are limited to solving the refugee crisis. There are parliamentary elections coming up in the country this autumn and it is highly unlikely that European issues will push through ahead of national and regional ones, especially at the background of highly tense relations with Serbia and Hungary. Nevertheless, Mr Mondekar hopes that this time the too familiar old subjects of the Croatian Fascist past and the independence war with the famous question “Where were you in ’91?” will not prevail in the pre-election campaign. He wishes that the campaign is built mainly around Croatia’s visions for the years until 2020 and 2050. And if some European subjects sneak in that would be great. To him, important issues are the development of the digital market and the energy union. All subjects, he says, no one talks about in Croatia.

Alas, they are not the most popular issues in the rest of the EU either. Centre stage in media attention in the EU, except to the refugee crisis, is given to the continuation of deepening of integration within the euro area. This subject opened the autumn political season in the European institutions as well, where a substantial discussion started of the five presidents’ report, which provides for two stages of deepening. The first one is full implementation of current legislation, which would achieve a considerable integration effect, the report’s authors believe – the bosses of the ECB, EC, EP, the Eurogroup, and the European Council. The second stage envisions the creation of new community institutions and possible changes in the founding treaties of the EU. Another important issue in the European agenda is Great Britain’s request for a reform of the EU, accompanied by a referendum on its staying part of the EU. 

These issues are very important to Daniel Mondekar as well, who claims that what happens in the euro area is especially important to Croatia for the state is highly euroised. He says this has a background story. Croatia was extremely dependent on the German mark, which was later replaced by the euro. At the moment loans in Croatia are in euro, prices are often discussed in euro, car prices are compared in euro, the price per square meter of properties is also in euro, regardless of the official currency being the kuna. It becomes clear from Mr Mondekar’s words that any future membership of Croatia in the common currency zone is too distant. He reminds that the country is still in an excessive deficit procedure, has sizable macroeconomic imbalances, and “we are trying to get closer to the advices and recommendations of the EC within the European semester.”    

In this setting I was very curious as to what does the Chairman of the European Affairs Committee think of the idea of the prominent British pro-reformist think tank Open Europe that euro area membership becomes voluntary. At the moment, all non-euro states, excluding the ones having opt-outs, must adopt the common currency when they fulfil the requirements for it. However, an exact date for it does not exist in any of the accession treaties. Daniel Mondekar sees a lot of problems in voluntarism, least of all because it is not yet clear what could the entrance and exit criteria be. This is, however, the lesser issue. “You cannot enforce discipline, be disciplined, and when you hit a wall say ‘Okay, goodbye’. We will write off part of the debts and say ‘bye’”.

There is only one direction for the euro area’s development and it is towards stronger integration. This, however, does not mean having a separate parliament, for such a decision will confuse citizens. In all cases, a stronger coordination between member states that are in the euro area is called for, as well as more frequent summits of the states sharing a single currency. The future of the euro area, however, depends heavily on Greece, where the problem is far from solved, says Daniel Mondekar. He does not expect a disintegration of the euro area.. 

Otherwise he agrees with some of the United Kingdom’s requests for changes in the EU, mostly with having Brussels stop regulating minor things like the size and shape of cucumbers. Brussels should interfere only where it is necessary and where it is clearly written. All in all, European institutions should be working on major issues only is Daniel Mondekar’s opinion, which coincides fully with the Juncker Commission’s vision. Another initiative that the Social Democrat is supporting is the introduction of green cards for national parliaments. This means giving them the possibility to propose bills to the European Parliament. He is certain many of London’s demands could be met without changes in the treaties, where there are still too many “grey areas” in subsidiarity, meaning what can be done on the institutional level and what at the national level. 

He is definitively against any changes in the Treaty. Many things in the Treaty of Lisbon have not yet been used to their limit. Let us first identify those grey areas, let us see what is there that we have not used yet in it and then start to talk about changes, he pleads. “If I have to be honest, changes in the Treaties are Pandora’s box.” He is convinced it will not go as far as a BRexit, unless rhetoric in the United Kingdom does not intensify from the Conservatives’ side, but also from Labour. In this sense, Daniel Mondekar was not too surprised at the election of Jeremy Corbyn for leader of the Labour party nor does he expect him to be a severe socialist as many have forecasted. “I do not expect he will turn the Labour party into SYRIZA. But he is sure to further raise the discussion of Great Britain's future in the EU. Whether this will contribute to a BRexit – I doubt it”, he says.

In his opinion Great Britain’s exit from the EU would be extremely dangerous to the Union, for it brings in tow the question of Scotland,but also Ireland, for the latter is heavily dependent on the British market. 80% of Irish export is to the United Kingdom, shares Daniel Mondekar. He regrets that, according to recent polls, citizens of South East Europe are least concerned about the BRexit possibility. “And it is not because we consider Great Britain to be too far away, but because European issues find no media coverage in South Eastern Europe”. Not much is written about a BRexit nor about the negotiations on the Transatlantic Trade and Investment Partnership (TTIP), or the energy union. Great Britain’s exit will cause great commotion in the entire EU – from Germany to Bulgaria and Greece, summed up Daniel Mondekar, firmly believing his party is going to win the upcoming parliamentary elections in Croatia. 

*The video attached is in Croatian language

Translated by Stanimir Stoev

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