EU Leaders Look for Reform, Greater Unity Ahead of Brexit

By Valentina Pop Features Dow Jones Newswires

The European Union is officially out of crisis mode, EU leaders signaled at a summit in the Estonian capital on Friday, where they addressed overhauls to reshape the bloc once Britain leaves in two years time.

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Over the past seven years, EU leaders have stumbled from emergency summit to emergency summit, initially caused by the global financial crisis and later, by Russia's intervention in Ukraine, terrorist attacks and the unprecedented wave of migrants and refugees from the Middle East who entered the bloc in 2015.

Last year, the U.K.'s voted to leave the bloc and the rise of nationalist, anti-EU politicians seemed to leave the EU on the brink.

But at a four-hour dinner on Thursday night and discussion Friday on fostering the bloc's digital innovation, the mood had visibly changed even if different views remained on the bloc's future.

Leaders "were pretty much all on the same page, so I was very pleased with the debate," said European Commission President Jean-Claude Juncker.

The re-election of German Chancellor Angela Merkel and the recent speeches of Mr. Juncker and French President Emmanuel Macron setting out their post-Brexit visions gave a new impetus to leaders to think beyond the next few months.

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There are ideas already in the works, such as an increase to the common EU defense budget that countries would be able to tap when jointly purchasing military hardware, harmonizing asylum procedures and expanding the EU's border protection force.

There are also more far-reaching changes: a eurozone budget complete with its own finance minister, a European Monetary Fund for future debt crises and an EU prosecutor able to fight terrorism and organized crime. Mr. Juncker has proposed scrapping the double-headed leadership of the EU and creating a single EU president while Mr. Macron is talking of halving the number of EU commissioners.

Leaders agreed in Tallinn to hold monthly summits through the rest of this year to work on these ideas.

Even Brexit didn't sour the mood in Tallinn. Unlike other recent EU gatherings to think about the future, British Prime Minister Theresa May was invited --and she came hammering home her promise the U.K. will remain a close partner on security and defense issues.

Mrs. May abided by suggestions from Brussels that she avoid using Thursday's dinner to push her proposals on Brexit although the British prime minister held a number of bilateral meetings on the sidelines.

But while there is agreement that now is the moment to look ahead, reaching agreement on long-term changes is far from certain.

Central European states that haven't adopted the euro fear that carving out a eurozone budget would leave them with fewer EU funds. Ms. Merkel and Mr. Juncker say that is not their intention and insist they want to use funds to encourage them to join the single currency.

Fiscal hawks, such as Dutch Prime Minister Mark Rutte, said discussions must stay focused on economic reforms and not drift into vague navel-gazing.

"Macron has ideas, but so do we. Let's implement what was agreed, let's under-promise and over-deliver," he said.

Lithuanian President Dalia Grybauskaite also expressed skepticism at what she described as "a lot of proposals without substance."

Donald Tusk, who holds the European Council presidency position Mr. Juncker wants to abolish, said he would consult capitals over the next two weeks and draft a leaders agenda for the future they can sign off next month.

But he also warned the bloc needs to focus on "real solutions to real problems" and must ensure that its debates about the future avoid opening fresh divisions.

We "need to keep the unity of the 27 Member States, also in the context of the new ideas," he said.

Write to Valentina Pop at valentina.pop@wsj.com

(END) Dow Jones Newswires

September 29, 2017 10:51 ET (14:51 GMT)