Is the EU a model for regionalism?

Regionalism can be defined as the growth of societal integration and interdependence at a regional rather than global level. The European Union is widely considered as one of the most ‘successful’ (or most advanced) models of regionalism on the basis that it has achieved an unparalleled level of Supranationalism (the transfer of power from the level of states to that of superior intergovernmental institutions) which can almost be defined as quasi-federalism. Often used by Functionalist theorists of global governance as an example of how integration begets further integration, the example of the EU is seen by many as both the natural and desired model of regionalism. However, recent trends towards de-globalisation and failures of EU regionalism such as the Eurozone crisis has led commentators such as Andrés Malamud to assert that 'regionalism is out, sovereignty back in'. This essay shall weigh up the various arguments in an economic, political and security sense to ultimately determine that the EU is no longer the sole model for regionalism, but elements of its path to regionalism are still copied by many emerging regional organisations.

One of the most distinct ways in which the EU has traditionally been a model for regionalism is in the economic sense. Proponents of the Functionalist theory of integration such as David Mitrany assert that “form follows function”, with the model of integration suggesting that economic trade blocs beget further regionalism. This was evidently the case for the EU, which began as a trade bloc in the form of the 1952 European Coal and Steel Community. This led to the integration of other energy sectors, leading to the European Atomic Energy Community, until the eventual creation of the European Community. Increasing economic interdepence leads to ideas such as standardisation of quality requirements for goods and produce to facilitate easier trade between states. This model of regionalism has evidently been increasingly emulated, as from 1990 to 1994 the GATT was informed of over 33 new regional trade agreements. One of the most distinctive emulations of the EU model came in 1994 with the West African Economic and Monetary Union, one of few regional currency unions globally (the CFA Franc, which is pegged to the Euro). This stems from economic integration meaning trade between constituent nations like Burkina Faso, Niger and Cote d’Ivoire is made easier by sharing a currency.

However, argue there is a limited extent to which West African Monetary Union provides an exemplar of the EU as a model for regionalism, as it may instead serve as an instance of neo-colonialism. Instead of functionalist integration, regionalism may be being increasingly imposed and artificially encouraged by institutions like the EU even where it does not directly align with state interests.  According to more Realist, intergovernmentalist understandings of regionalism, the EU no longer remains a model for most states as exemplary regionalism as it typically fails to align with their interests. For instance, in November 2015 ASEAN announced their “2025 blueprint” for the organisation. As one of the most successful and distinctive regional organisations outside of Europe, it is notable that even this plan failed to include desires for a monetary union. Economic regionalism for this organisation and many like it is thus limited to its “closed” sense; the creation of import substitution and preferential tariffs within the region to prevent outside competition. This does not in itself encourage further economic integration and the increasing competency (powers) of individual institutions as per the European model without the influence of alternative, external factors. These may be exogenous such as the US’s instrumental role in the formation of the EU and the EU’s role in forming regional organisations elsewhere globally, or they may come in the form of desires for security or political collective security.

This may link to what may be deemed the “non-replicability” of the European model of economic regionalism, as well as its failures. The Eurozone crisis was in part caused by the problems of having distinctly economically and culturally different countries within the same monetary union. This led to the problem of Greece, with its low tax collection rate and high public spending, negatively impacting the value of the Euro as it consistently borrowed to fund its expenditure, as opposed to economies like Germany which operate under completely different philosophies. Europe contrasts most regions globally in being relatively homogenous in terms of the general nature of its economies, values, demographic makeup and culture. The economic diversity of South America, for instance, means that Brazil is by far the pre-eminent state in MERCOSUR, making up over 70% of the organisation’s GDP. Although Germany is a benign hegemon in Europe, a power imbalance as distinctive as this is likely to prevent successful economic co-operation and integration as per the European Union as Brazil can simply dominate discussions. Evidently, as such, there is both a global lack of desire to follow the European model and a general understanding that it is untenable for most states. The success of regional monetary unions appears to require either a pre-existing similar approach to fiscal policy, or the transfer of fiscal policymaking to supranational regional institutions. This may seem particularly unlikely in a current environment tending towards populist nationalism and protectionism, ranging from the recent Latin American ‘pink tide’ to the UK’s vote to leave the European Union.

Regional cultural differences are also a reason for which the EU cannot act as a model for political regionalism. The EU typically externally presents itself as a paradigm of “soft-power”, enforcing local standards of human rights via the ECHR and having its own supranational judicial system via the CJEU. Attempts have been seen to be made by some organisations towards political regionalism, such as the Arab League’s condemnation and expulsion of the Syrian regime from the organisation. However, there is much diversity within the area, ranging from traditional monarchies such as Saudi Arabia to authoritarian governments and revolutionary governments like Egypt and Libya. This meant, for instance, in the case of Syria the observation / monitoring missions in Damascus by the organisation failed to last after disagreements amongst the politically diverse member states over Western interference in Arab affairs arose. As such, further political integration is unlikely to follow the EU, whose model suggests that economic interdependence and monetary union leads to a fiscal vested interest in the external reputation of constituent states. The inherent, fundamental disagreements between many of these nations on matters such as human rights ultimately makes the EU an unlikely model for political integration. This is most significantly because it implies pooled sovereignty, with particularly developing nations being likely to fiercely protect their sovereignty having only attained constitutional independence relatively historically recently.

However, arguably part of the initial EU model was regionalism for the purpose of security. Part of the goal of the US in helping to form the EU was to prevent France and Germany entering future conflict by ensuring their interdependence.  Regional Organisations such as the Shanghai Co-Operation Organisation (SCO) have similarly emerged in order to ensure collective security of members like Uzbekistan and Russia.

However, there is a severe limit to the security regionalism of even the EU, who have failed to create a coherent Common Foreign and Security Policy, having only undertaken a few dozen missions since its inception. Instead, NATO has been relied upon to resolve matters such as the campaign in Kosovo in 1999. Additionally, organisations such as the SCO may be seen to have a primarily economic focus, with the SCO being utilised by China as a vehicle to promote and help instate its New Silk Road initiative.

Ultimately, although the EU is evidently one of the most successful regional organisations globally, evidently there are few able or willing to follow in its footsteps. Additionally, even with the EU there is no consistent model for regionalism. Instead, there are several streams, ranging from the quasi-federal Eurozone to the Schengen Area and skeptic countries such as the UK which has now moved to de-regionalisation by beginning the process of exciting the EU. As such, the EU can only be seen as a model for regionalism in an economic sense, and only here in the limited sense of regional free trade agreements. The later regionalisation developments of the EU have either failed (such as security initiatives) or appear inapplicable to other regions.

Tracey Mwaniki