It can be suffocatingly hot in Brussels at this time of the year. Thousands of EU bureaucrats and politicians are packing their bags to start what they believe are their well-earned summer holidays. But this will be one of the hottest and longest political summers in the history of the EU.

Members of the EU political elite have a number of issues to deal with. Some are legacy, slow burning issues. Others are new crises that have erupted this year. It is becoming increasingly clear that the lack of economic and fiscal reform will keep posing existential risks for the EU.

Fiscal and monetary policies are still not synchronised as member states jealously defend their right to decide on tax matters in their own countries, while the ECB ponders when it will be the right time to start increasing interest rates and stop printing money to buy mostly distressed sovereign debt.

The EU economy is again showing signs of anaemic growth. It has been living on the artificial steroids of low interest rates for too long. While this has staved off an economic recession since the financial crisis of 2007, it has certainly not been enough to compensate for the lack of political determination to implement the economic reforms that are needed to stimulate growth.

The Brexit process is proving to be messier than many ever imagined. One direct consequence is that the 2001-2007 EU budget will have an acrimonious approval process as member states including Malta try to deflect as many of the budget cuts in the allocation of cohesion funds.

The Polish government has already declared that it will not budge on refusing to accept the 24 per cent cut in the funds that his country will receive in the life of the next EU budget.

The EU economy is again showing signs of anaemic growth

Perhaps the most difficult challenge that the EU will be facing this summer and beyond is the growing tide or euroscepticism in many of the member states. Of course, the biggest challenge will come from Italy which now has a collation government made up of two eurosceptic parties. Even if the rhetoric of the new Italian government is somewhat more subdued than it was during the March election campaign, Italy will certainly use its veto on various issues that require unanimous consent unless it gets what it wants on the issues of immigration and debt and deficit management.

Hungary and Austria have already turned far right with anti EU feeling permeating their governments’ political rhetoric. Spain has a weak government and may soon end up facing a new election. The trade war with the US does not promise any good especially after the clumsy behaviour of Trump in the G7 meeting in Canada.

We have our own issues with the EU. Negative perceptions about Malta are proving difficult to manage. Our national airline will continue to come under scrutiny from EU competition authorities to ensure that it remains untainted by state aid. The requirements for the upgrade of our infrastructure remain a daunting task for the next two decades.

With a rising population and high building density in areas like Sliema and St Julian’s, not only do roads need to be upgraded, but also water and drainage systems that were built at a time when these areas had a quarter of the population they have today. The reduction in the cohesion funds comes at an awkward time when these massive infrastructure projects need deep financing pockets.

I consider the immigration problem as the most daunting issue facing the EU in the next year and beyond. Clearly, if Italy pulls out of its role as being the first place of refuge, irregular economic and political immigrants from North Africa will try to find new routes.

The EU is not prepared to face another migration crisis and political leaders disagree on how to find a fairer way of distributing even a minimum target number of immigrants that may be allowed to settle in the EU.

With Libya looking ever more like a failed State, migratory pressures continue to build up. There is no point in looking at the Dublin treaty for solutions. Southern European countries including Malta cannot on their own solve the migrants’ crisis.

EU citizens are rapidly losing faith in their traditional politicians and the institutions they manage. They would rather trust new and untried politicians than accept a recipe of ‘more or the same’ unproductive policies. This is not good for the future of the EU.

johncassarwhite@yahoo.com

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