Why 2009 is a crucial year for Europe

Summary

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Podcast Summary: Why 2009 is a Crucial Year for Europe

LSE: Public lectures and events, LSE European Institute’s Future of Europe Lecture Series
Speaker: Bruno Le Maire, French Minister of State for European Affairs
Date: February 5, 2009
Host: LSE Film and Audio Team

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Episode Overview

This episode features Bruno Le Maire, then France’s Minister for European Affairs, delivering a public lecture at the LSE on why 2009 stands as a pivotal year for Europe. Set against the global financial crisis, Le Maire’s address covers the urgent economic and political challenges facing the EU, the necessity for intra-European solidarity, reform, and global coordination, as well as France’s vision for the future of European integration, security, and enlargement. The talk is followed by a robust Q&A with the audience.

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Key Discussion Points and Insights

1. Setting the Stage: Europe at a Turning Point

• Bruno Le Maire opens with humor about languages and the value of institutions like the LSE and the need for fresh economic thinking ([04:10]–[05:41]).
• Emphasizes the renewed partnership and trust between France and the UK since 2008.
• Stresses that 2009 marks a “crucial turning point” economically and geopolitically.
• Major outstanding questions for Europe: managing the crisis, building a new financial order, responding to China, US, Iran, and Middle Eastern peace efforts ([05:41]–[07:40]).

2. The Economic Crisis – Europe’s Greatest Test

• Le Maire describes the scale: “Europe has been facing its strongest recession since 1945.” ([08:26])
• Highlights unemployment spikes, especially in Spain, and imminent risks of social unrest.
• Warns against protectionism, citing dangers to “global trade, free movement of capital, the end of poverty for millions…” ([11:22]).
  • Quotes Shakespeare: “Time is out of joint.” ([08:59])
• Makes a vital distinction:
  • Some defensive, temporary national measures may be necessary, but outright protectionism is disastrous and must be avoided.
  • Calls for strong, coordinated European and global responses: “When the house is on fire, there is no time for complacency.” ([13:46])
• Calls Franco-British cooperation, EU-wide coordination, and solidarity the only responsible path forward.

3. The Need for Regulation and Reform

• Strongly advocates for international regulatory overhaul:
  • “Self-regulation does not work… We need transparency, responsibility and accountability.” ([17:45])
  • No taboo on topics such as bankers’ salaries, tax havens, hedge funds, or accounting rules.
• Highlights the upcoming (April 2009) London G20 summit as a moment for Europe to show unity and leadership ([17:45]).

4. Political and Geopolitical Roles for the EU

• Europe must simultaneously handle economic rescue and international security challenges.
• Recent EU achievements:
  • Mediation in Georgia, military operations in Chad, presence in Gaza, anti-piracy off Somalia ([19:23]–[21:01]).
• On defense:
  • EU is now a “fully fledged organization,” not just a financial backer.
  • Calls for complementarity between EU defense efforts and NATO, not competition ([22:04]).
  • France considers full reintegration into NATO’s military command, expecting stronger EU-NATO cooperation.
• On enlargement and Europe’s “attractiveness”:
  • The Balkans are the next region eligible for EU membership, but future expansion requires institutional reform (Lisbon Treaty).
  • The Union for the Mediterranean offers a platform for neighbors, but is “not a way of putting aside Turkey.” ([28:00])

5. Values, Instruments, and the Challenge of Unity

• Returns to Shakespeare: “Something is rotten in the state of this world.” ([25:46])
• Expresses strong conviction that Europe, if united, can meet the challenge, with France and Britain as special leaders.

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Notable Quotes & Memorable Moments

• On economic recovery and cooperation:
  • “When the house is on fire, there is no time for complacency.” – Bruno Le Maire ([13:46])
  • “Coordination is a difficult but vital task for all our country.” – Bruno Le Maire ([18:05])
• On financial reform:
  • “Self regulation does not work. We need transparency, responsibility and accountability.” – Bruno Le Maire ([17:45])
• On EU’s roles in crises:
  • “Time is over when the EU was only a backup organization invited to pay the bills to donor conferences.” – Bruno Le Maire ([20:15])
• On enlargement & Turkey:
  • “This is not a way of putting aside Turkey. This is a way of associating all those countries to the development of the EU.” – Bruno Le Maire ([28:00])
• On protectionism versus defensive measures:
  • “The difference is very hard to see and very hard to draw, but this is the difference between protectionism as such and defending our industry.” – Bruno Le Maire ([54:21])
• On Europe as a solution:
  • “Europe is a solution to the crisis. And Europe has its own attractiveness and will remain very attractive for many countries which are just at the border of Europe.” – Bruno Le Maire ([43:11])
• On institutions and unity:
  • “The big states have big responsibilities. That's so simple like that.” – Bruno Le Maire ([67:44])

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Q&A Segment Breakdown

On Union for the Mediterranean and Turkey ([27:35]–[30:28])

• Q: Is the Union for the Mediterranean a fair offer to Turkey?
• A: Le Maire insists it's fair, and not a substitute for Turkish EU membership, but a platform for joint projects involving all Mediterranean neighbors ([28:00]).

On France rejoining NATO and Russia ([30:35]–[36:08])

• Q: Will France’s NATO return deepen splits over Russia?
• A: Le Maire reassures the aim is EU unity and stronger European voice in NATO, not splitting over Russia ([33:30]).

On Political Shifts in the EU ([36:17]–[38:43])

• Q: Would a parliamentary majority change affect policy?
• A: Policies need cooperation, regardless of political leanings ([36:56]).

On Stability of the Euro ([38:51]–[41:31])

• Q: Is the euro at risk?
• A: “Euro is a very stable currency and will remain a very stable currency in the coming weeks, in the coming months and in the coming years.” ([40:12])

On EU Integration’s Opportunity Costs ([42:03]–[44:33])

• Q: Are there downsides?
• A: Le Maire sees only positives, referencing successes in new member states and quoting Voltaire ([43:33]).

On Infrastructure Investment ([45:26]–[47:59])

• Q: Is there a pan-European infrastructure investment strategy?
• A: The need is recognized, but EU budget constraints hamper unified investment; Le Maire advocates for larger EU budget in future ([46:13]).

On Defining Protectionism ([47:59]–[54:21])

• Q: Can limited defensive measures avoid true protectionism?
• A: Le Maire stresses balance: supportive, proportionate measures coordinated at the EU-level vs. harmful, unilateral protectionism ([49:17], [53:13]).

On Fiscal Stimulus Coordination ([55:14]–[58:38])

• Q: Can the EU lead on fiscal stimulus?
• A: Fiscal policy remains national; Le Maire calls for more future coordination to ensure fairness and effectiveness ([55:49]).

On Enlargement, Turkey, and Confidence ([58:50]–[64:13])

• Q: On EU enlargement and Turkey’s application.
• A: Supports Balkan enlargement post-Lisbon Treaty but is cautious about Turkey, maintaining that Turkey is not ready for membership ([61:19], [62:55]).

On Leadership and Coordination ([64:33]–[69:53])

• Q: Who are the “crucial actors” for Europe in 2009?
• A: All actors have roles, but “big states” – France, Germany, UK – must lead on financial and economic reform; unity is fundamental ([67:44], [69:38]).

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Important Timestamps

• Main address by Bruno Le Maire: [04:10]–[26:22]
• Union for the Mediterranean/Turkey: [27:35]
• NATO, Russia, and Security: [30:35]
• Political dynamics in the EU: [36:17]
• Euro stability: [38:51]
• EU Integration benefits: [42:03]
• Infrastructure investment: [45:26]
• Protectionism vs. defensive measures: [47:59]
• Fiscal stimulus coordination: [55:14]
• EU enlargement and Turkey: [58:50]
• Actors and leadership in the crisis: [64:33]

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Conclusion

Bruno Le Maire’s address underscores the existential challenges faced by Europe in 2009, from financial collapse to political unity and global responsibility. He calls for strong EU coordination, robust financial regulation, a renewed Franco-British partnership, and clarity of purpose in both economic and geopolitical spheres. The EU, he insists, must adapt—outward-looking and united—to reclaim credibility. The Q&A displays both the complexity of European integration debates and the pressing anxieties present during the crisis, with Le Maire advocating pragmatism, solidarity, and institutional reform as Europe’s best path forward.

Transcript

[Event Moderator]

Well, ladies and gentlemen, as you might imagine, I'm delighted to welcome this evening to the school Monsieur Bruno le Maire, who is, as you know, France's Minister of State for European Affairs. He's speaking to us this evening within the LSE European Institute's Future of Europe Lecture series, which is sponsored by Financial Times Business. Now, Minister, I'm sure you're very aware of the school's very close times ties with France. It's hard to know where to begin, really. They are so extensive. We have well over 200 French students at the LSE. We have hosted many distinguished speakers from the French policy making community in the last few years, including your predecessor, Jean Pierre Juliet. In the spring of last year we hosted an excellent one day conference to mark the launch of the French Presidency last June, working in partnership with the Embassy. And I'm pleased to say that the Embassy also supports the continuing Franco British dialogue in which eminent scholars from Sciences Pour come to share their wisdom and to debate with public audiences here at the lse. We now have five joint Master's degrees with Science Pour, whose Dean of studies, Laurent Bigon, is seconded to us for a year to help help deepen the partnership between our institutions. And we're also delighted to have with us for two years Marie Mandras of Sciences Po, who is with us here as LSE Sciences Po Alliance Professor. But more about our speaker. Bruno Le Maire achieved the double distinction of graduating through both Normale Soupes and Sciences Pour. He was Principal Private Secretary to to the French Prime Minister from 2006, 2007 and before that he held advisorships to the Prime Minister, to the Foreign Minister, to the Interior Minister. He's a member of the national assembly for the Department of the eure and he has been a political advisor for the governing UMP party since 2008. And he's also written some very fine books and prize winning books on, amongst other things, on Homme d', Etat, on Statesman and on Le Ministre.

[William Horsley]

Minister.

[Event Moderator]

It's hard to believe that it was a Frenchman, one Charles Maurice de Talleyrand Perigord, who, no less, who cautioned against too much enthusiasm. Sieur tout Padre de Zelles, as he famously said. This from the country which has given us Nicolas Sarkozy and Bernard Kushner. How foolish we were to think that we could pause to gather breath after such a hyperactive and notably successful French presidency of the eu. Now that Europe will need French adrenaline to help it meet the challenges which it's facing, which you'll be Describing here this evening seems to me self evident. And how pleased we are that you are here this evening to help maintain that momentum. Last week, Minister endiberation, you said that contrary to received opinion, Europe is taking part in the construction of a new world order. Well, I think you are right. I certainly hope you are right. But at the very least, it is a proposition which we will need to test. And I suggest we might start doing so in the next hour or so. So, Monsieur le Maire, the floor is yours. And please tell us why 2009 will be a crucial year for.

[Bruno Le Maire]

Ladies and gentlemen, dear friends, it is a great honor and pleasure for me to take part in the course of lectures organized by the lsc, European Institute on the Future of Europe. I'm considered in France to be a close friend of Germany.

That's true.

I know this country quite well and I speak the German language. By the way, I intended to deliver my speech in German, but my advisors told me it was a bad idea. I fear, however, that the bad idea for me is to speak in English, considering my terrible French accent. I'm honored to be here in one of the most respected and influential schools in Europe. Europe needs such high profile institutions, notably in economics. That's the reason why I personally contributed to the creation of the Paris School of Economics a few years ago. More than ever, we need fresh ideas to reform our market economies. I'm proud that some French economists, like Jean Tirol or Michel Aglieta, were more than others aware of the flaws of financial capitalism. This is my first visit to London, a few weeks after my appointment as the French Minister in charge of of European Affairs. I was eager to come here very quickly after my first visit abroad in Berlin. This is a sign of confidence between France and the United Kingdom. Our two countries have entered into a new era of entente formidable last year after President Sarkozy's state visit. I wish to take part very actively to this renewed partnership on every subject of common interest in the field of European affairs. I will not enter into the track record of the French presidency of the European Union as you all know it. This was a great success for France and for Europe. But pretending it would be considered here as a new proof of French arrogance which can only be compared to British eccentricity. As everybody knows in Europe. This must be the reason why we can so easily understand one another by reference to the title chosen for this speech. I would rather look forward to the challenges ahead of us. 2009. We all must be aware that 2009 will be a crucial turning point for the world, both from an economic and geopolitical point of view. Will all states be able to cope with the economic crisis? Will be able to build a new financial order? Will China and the United States keep a cooperative stance? Will Iran finally change its behavior towards the international community? Will the new American administration be in a position we hold with all its partners to give a new impetus to the Middle east peace process? There are many questions waiting for immediate answers. In this great international bargain, Europe will have a key role to play. It will have to prove that it can obtain concrete results. Moreover, in the coming months, the leaders of the EU will be facing their public opinion through the elections to the European Parliament and in some member states, general elections. Governments will have to give an account of their action to avoid their voters to lose their jobs and houses in the context of a rising economic crisis. One of the questions from the voters will is the EU the relevant level to tackle the crisis or is it not? To reach those goals, Europe has to change its old habits. For a long time, Europe was essentially inward looking. It has now to become outward oriented. For many years, Europe mainly took care of itself, of its institutions, of its internal rules. This time is over and our efforts have to be dedicated to a global influence in the world of the 21st century. The main hacky of the French presidency of the EU is to have brought back politics into the eu. For us, this has been a decisive step forward. We have enabled Europe to assert itself power politically. So it is now much easier to convince our public opinion that the EU can be an answer to their problems. Yes, Europe is one of the most relevant answers to meet current challenges. Yes, Europe is a relevant level of action between national states and the global world. The French presidency has provided tangible proofs of those facts. But now more has to be done. In 2009, we are witnessing an economic and financial crisis of historical dimensions. The very long period of global expansion has been brutally brought to an end. The global economy is confronted to a very sharp downturn. World GDP is expected to stagnate. World trade is expected to shrink by 5% in 2009 after a long period of strong growth. Europe has been facing its strongest recession since 1945. By many aspects, this crisis cannot be compared to any other economic downturn. Emerging countries are hardly hit. The US economy is is no longer the main engine of the world economy. And nobody knows today when and how strong it will recover. Unemployment rate is up all around the world and some European countries are very hardly affected. I was very impressed by the unemployment figures published in Spain this week, more than 200,000 jobs lost in only a month and 1 million jobs lost last year. These are clear signs of anxiety among our citizens. And there are risks of social unrest. This crisis is an unprecedented shock for our world. As Shakespeare would say, time is out of joint. We know it from the past. There are two ways for the world in front of such events. The first way is protectionism. This is a very dangerous one. Of course, in time of crisis, all citizens are expecting their leaders to do whatever is possible to preserve jobs. We shouldn't be naive in preserving our legitimate economic interest in front of unilateral actions from other major powers. We cannot but react in Europe and ask for reciprocal benefits in trade. Let's be realistic. Some measures may be unavoidable to protect business and jobs in our countries. But they have to be limited, controlled and proportionate, using our European framework. In the field of state aid and trade policy, protectionism is another matter. It is when countries close borders, refuse cooperation, stigmatize foreigners. This is a real threat for the world economy. This is also a real threat for Europe. Between EU member states. Such behavior would simply be a disaster for every country and for the world as a whole. It would lead to very negative economic consequences. All the benefits of globalization would be put at risk. Global trade, free movements of capital, the end of poverty for millions of people in the developing world. In Europe, protectionism would simply be absurd, considering all the benefits we have gained from the single market and economic integration. I fear protectionism would also mean negative political outcomes, the return of xenophobia, the rise of extremism. We have to consider the seriousness of these risks and to remember that there is another way. This is what I call international cooperation. This is not the easiest behavior to adopt. Collective action may not be a natural stance in time of crisis. However, this is the greatest challenge for our time. A lot of work has been done by the French presidency of the eu, in close links with its main partners. We owe to Prime Minister Brown's leadership the principles of the European banking rescue package in October. It was a good example of the strong Franco British cooperation President Sarkozy asked for last year during his state visit to the uk. We also have a European framework for national recovery plans. But challenges remain. Europe has to go ahead towards more coordination to fight the crisis. This is the strongest message I have delivered in every place since I took office in December. Coordination between the member states and is the right way for dealing with the crisis. In the short run. We have no Other option but to mobilize every euro or pound at our disposal. This is an urgent need. When the house is in fire, there is no time for complacency. European and global coordination are keys in that respect. At the global level, the IMF is a strong advocate of fiscal stimulus all over the world. This is welcome and things are moving in the right direction. We are reaching a critical mass in terms of recovery plans adapted to the specific situation of every country. Chancellor Merkel has proposed a new International Economic Council. This idea should be discussed. It could be a right answer. To strengthen coordination. We will be all the more convincing towards our international partners that we will be exemplary at the European level. We have institutions in place and instruments at our disposal. They have to be fully mobilized in support of a strong coordination of national recovery plans. We also need a truly European industrial policy, a European energy policy and a renewed stimulus for research, education, infrastructure. Member states have announced national plans, notably in support of the car industry. That's a good thing. But these initiatives cannot fully reach their goals without a proper coordination. That's why I'm asking for. In Brussels and in European capitals, we need a strong commission and a strong presidency of the Council to promote collective action in Europe in support of our economies. France, the UK and Germany bear a special responsibility in that respect. We are three strong industrial nations. Competition between our companies is a good thing in normal times, but would be counterproductive in time of crisis. A good cooperation between France, the UK and Germany is a prerequisite for an appropriate EU response to the crisis. Competition cannot be the only rule for Europe in the current circumstances. We need solidarity more than ever. There is also a great challenge in terms of financial reform. The London Summit next April will be a key meeting. Europe has to deliver a strong message to the rest of the world. President Sarkozy is determined to promote a united European voice during the next meeting in Berlin around EU members of the G20. I may not be very consensual with everybody here, but I am convinced that we need a strong, coherent and complete regulation. In the financial sector, self regulation does not work. We need transparency, responsibility and accountability. No option should be out of the table on salaries and bonuses, tax havens, supervision and controls, hedge funds, accounting rules, securitization, leverage. We need a strong international regulatory framework. And I know that the UK is very actively preparing the London Summit.

In that field.

The stakes are high because a financial crisis is not only a banking meltdown, it leads to an overall systemic and economic crisis. We cannot accept our prosperity to be jeopardized by speculation, greed and irresponsibility. What is the exact contribution of innovative finance to our global prosperity? Can we accept bankers to sell products they don't really understand? Is it normal that speculation has become the main activity of the banking sector? How can we accept that the viability of public finances is put at risk by one economic activity at the expense of all the others? There should be no taboo. To sum up, coordination is a difficult but vital task for all our country. I know that France and the UK strongly share this view. We have special responsibilities as EU member countries and as members of the international community. We also know that this crisis reveals the need for better global governance and stronger institutions at the EU level, with the Lisbon Treaty, and at the global level. This is our common goal inside the eu, at the un, in the IMF and the World Bank. More than ever, the European answer to the economic crisis is a real test for the eu. Whether Europe dominates the crisis or the crisis will dominate Europe. Europe's credibility as a political project for the coming years is at stake. This is also true in the field of geopolitics. Europe has to face the two challenges at the same time. Saving the economy and being active on the international stage. These are the two faces of the same reality. During the last month, the EU appeared as a major player in all international crises. Just the most significant examples. The EU ended the war in Georgia. The EU is in Chad to protect refugees from Darfur through a military force fully operated by the EU and commanded by an Irish general. The EU was also there to call for a ceasefire in Gaza, not waiting for the US to take over the responsibility. And last but not least, the EU operation currently underway against maritime piracy under British flag. What should be expected in 2009? Time is over when the EU was only a backup organization invited to pay the bills to donor conferences. The EU is now a fully fledged organization, capable not only of raising military capacities, but also of deploying a whole range of instruments, political, economical and humanitarian ones. France and UK strongly contributed to this evolution after the St. Malo declaration in 1998. Whatever the international crisis in 2000 may be, the EU must be ready to respond. In that view, we can rely on the development of the European security and defence policy. We can also rely on the strong expectations of our citizens in that field. During the French presidency, we have relaunched the European defence. The EU updated its security strategy and elaborated new capacity projects. This was an important step in the right direction, but we have to make further progress. In very concrete terms. We have to Take operational decisions on defence capacities and on industrial corporations. One reason to be optimistic is to consider that past debates are now closed. The development reached by ESDP in the past years means there is no longer any competition between the EU and and NATO. The EU has proved its full autonomy and capacity in this field. We now share one single goal promoting and developing complementarity between EU and NATO. The development of European defence now allows France to consider a renovation of its relationship with NATO. The 2009 NATO summit in Strasbourg and Kiel next April. April will be an important step at the occasion of the 60th anniversary of NATO jointly organized by France and Germany. Another way for European to promote peace and stability is attractiveness for its neighbors. But this attractiveness has to be carefully managed. One of the first expressions of our attractiveness is enlargement. This was an obvious response to Central Europe after the fall of the Iron Curtain 20 years ago. It should not be expanded to the Balkans once these countries satisfy their obligations and once the Treaty of Lisbon, which will adapt the EU institutions for further enlargement enters into into force. However, beyond the Balkans, enlargement cannot be the answer to the desire of Europe demonstrated by our neighbors. The Union for the Mediterranean is the first example of an offer of a comprehensive answer to our southern neighbors. A project respecting the sovereignty of all participants and taking into account their different levels of relation with the eu. The Czech presidency will work on Eastern partnership. It will help the EU build an overall relation with countries willing to come closer to the eu, like Ukraine, without dealing with the issue of a caxation. For the time being, France fully support this strategy. This is the only way for Europe to export its stability without jeopardizing its internal cohesion. Ladies and gentlemen, dear friends, 2009 is a very challenging time for Europe and for the world. I know that I take the risk to repeat myself, but I am deeply convinced that 2009 is a decisive moment for our world. To quote Shakespeare once again, something is rotten in the state of this world. To cure its illness, Europe has the necessary values. Europe has instruments at its disposal and a critical mass for action. It has now to prove its willingness to contribute to this global effort and to unite. I trust that that France and the uk, two strong members of the EU and the world community, will be able to help the world make good collective decisions within the months to come. This is our country's mutual responsibility. This is our country's mutual challenge. Thank you very much.

[William Horsley]

Well.

[Event Moderator]

Minister, thank you for a very clear and compelling tour d' horizon which I think has left us no doubt on the scale of the challenges. You've kindly agreed, as per the LAC's usual format, to take some questions. We have until about. Until about 7:30. You know the practice. Please put your hand up and I'll try and spot you and say who you are, where you're from or what you're doing. And then if you could just kindly wait for the microphone to be handed to you and speak closely into the microphone. And please don't try to smuggle in sub questions. Keep it simple. One would be great. And you may have a second bash towards the end of the session. Good. So would you like to take them in groups of three or individually?

[Bruno Le Maire]

Individually.

[Event Moderator]

Individually. Okay. Right, the lady.

[Bruno Le Maire]

Yes.

[Event Moderator]

In the dark jacket. Yes. And then William at the back. The lady next to. Yes.

[Mark Langdon]

Next to Elif.

[Bruno Le Maire]

Yeah.

[Tricia]

Thank you for your speech. My name is Ingrid Kilstar. I study at European Institute. I would like to ask you, sir, if you think the Mediterranean Union is a fair offer to Turkey in light of all the negotiations that have been going on the last years.

[Event Moderator]

Is the Mediterranean Union a fair offer to Turkey?

[Bruno Le Maire]

I think it is a fair offer. Not only a fair offer to Turkey, but also a fair offer to all Mediterranean countries. We need to face the challenge of the relationship between EU member states and member states of Africa and states at the Mediterranean border. This is a key issue for the future of Europe. And we did not have before the proposal put forward by President Sarkozy the right forum to discuss proposals and to discuss concrete steps to go forward with those countries. And I really think that this Mediterranean Union is the right way of dealing with the problems between the EU and states around the Mediterranean Sea. This is not a way of trying to jeopardize the future of Turkey, of trying to jeopardize the Turkish candidature to the EU membership. This is a way of associating all states around Mediterranean Sea to look at proposals, to look at projects that we could build together so that we could reinforce the economical and the social development of those countries. But don't make any mistake about this project. This is not a way of putting aside Turkey. This is a way of associating all those countries to the development of the eu. That's the way in which you should understand the project put forward by President Sarkozy and by France. And I'm very happy to see that many countries within the eu, like the UK or Germany, and all member states finally support the project put forward by President Sarkozy. This is a very good thing and know that we are facing also a big crisis within the Middle east with the crisis between Israel and the Palestinian state. I think that we need such projects. We need to put forward some concrete proposals on the table so that we can improve our relationship with that part of the world.

[Event Moderator]

Thank you at the back, William.

[William Horsley]

Thank you. William Horsley, Independent journalist Minister, let me ask you what France wants to get out of joining NATO. And bluntly, there is. There are differences inside NATO and the EU about dealing with Russia. And let me put it rather bluntly. Some might suppose that France's entry into NATO, powerful position, military commands and so on, might actually widen the splits in NATO about Russia. Some are concerned that President Sarkozy's welcome, or at least agreement to President Medvedev's idea of a new security architecture for Europe would undermine or split NATO, perhaps would reward Russian aggression in Georgia. So, taking your point about Europe's ambitions and certain success on the global stage, how would you answer the concerns of those in Eastern Europe, the polls, perhaps in Washington, perhaps in London, that France might actually bend NATO in a way towards this much more compliant attitude towards Russia on things like NATO enlargement, missile defense, the Security treaty and so on. And in particular, if Europe is going to have an influence, surely there is a very special responsibility towards those countries between Europe, the EU and Russia, which have committed themselves to Western identity, to democracy and so on in the face of the new assertive Russia.

[Bruno Le Maire]

As you know, this is a very sensitive issue in France and among EU member states. Let's try to explain with very simple words what is at stake and what are the purposes of the French government.

The idea is not at all to.

Widen any kind of split within NATO. The idea is to bring more unity among EU member states by having France taking fully its part within NATO. This is really what is at stake with this possibility, because it remains only a possibility for the time being, of having France coming back to the military structure, to the military command within NATO. I think that if we want to realise this possibility, we need two preconditions, I would say, even if it is not the right word. The first one is to reinforce the esdp, because there is no more any kind of competition between ESDP and NATO. There is now a strong cooperation, and this cooperation is in the benefit of all member states of the EU and of all members of NATO. This is a key point. We need, on the one hand, the reinforcing of NATO and on the other hand the reinforcing of the esdp, so that both structures could work together and could work closely together. This is the first point. The second point, which is also a key point, is to have European members of NATO playing fully their role within NATO. Never forget that the states which are providing troops for NATO, the major contributors within NATO are just after the Americans, the uk, France, Germany, I mean European states. And it seems to me to be quite clear and quite an evidence that in regards of this contribution of member states to NATO with troops, with arms, we need to have fully our role and fully our part within NATO. That's the second key point. And if those preconditions are met in the future, in the coming weeks, I think that there is a possibility for France to come back within the military structure and the military command of NATO. As far as this idea of split in NATO is regarded in regards of the relation with Russia, I would like to reassure you that of course, absolutely not the purpose of France, the purpose of France is, on the contrary, to reinforce the relationship between all NATO states and all EU member states so that we can cooperate with closely links and we enforce our security. Because the main task we have to build together and what is really at stake with this question of NATO and ESDP is only the security of EU member states and the security of NATO states. That's the key point. The idea is not trying to split or to make any kind of split between NATO states and Russia and to try to put some division among member states. The idea is to build unity and to build more security for all member states.

[Event Moderator]

Okay. From perhaps from this side of the room.

[European Studies Student]

Hello. I study European studies here in London and I was wondering, you've probably noticed that Nicholas Sarkozy and his government are right wing administration. The current European Commission is also composed mostly by right wing members. And the majority of the European Parliament is currently pped so conservative parliamentary group as well. Do you think that a possible shift in the parliamentary majority in Brussels, in Strasbourg, could influence European policies in the future?

[Bruno Le Maire]

First of all, I would like to underline that I did not choose the administration of France or the administration of the European Parliament. People choose this administration, this government and this parliament. I really think that in current circumstances, when we are facing such a huge crisis and such difficulties on the economical and also on the social fields, the question of being on the right wing or being on another wing, I'm not saying on the far right wing, I'm just saying on the right wing, on the left wing is not a problem. The problem is to build cooperation among all those institutions so that we can build some concrete Proposals to face the crisis. But I'm quite sure that even if you have a left wing majority within the European Parliament and a right wing majority within France, and a left wing majority in Germany and a left wing majority in the uk, that's not the problem. The problem is to find a way to cooperate together and to find concrete solutions to fate a crisis and to solve the problems we have to face. That's the problem. You are with responsible people, you are dealing with responsible governments and you are dealing with a responsible European Parliament. In any case, you will need cooperation. In any case, you will need to find those solutions.

[Event Moderator]

Lady Wright of the back in the plum Move.

[Tricia]

Hi, my name is Tricia, I'm an international political economy student and I have a question about the stability of the euro, given the different volatility and the.

[Event Moderator]

Different member nations in the European Union.

[Bruno Le Maire]

I didn't know that the question would be so difficult, otherwise I would have stayed in Paris.

[Mark Langdon]

But.

[Bruno Le Maire]

Europe is facing great difficulties. That's true. And you know that the word that everybody is using nowadays in Paris or in Rome or in Madrid is the word spread. I did not use the word spread before entering into that financial and economical crisis, but now I know the meaning of the word spread. So each day I'm looking at the spreads on a little paper brought by my advisors, explaining to me that spreads are today the most important thing they should look at. My conviction is that even if we have those problems with the euro, even if we have those spreads that we are dealing with very carefully, Euro is not in danger. Euro is a very stable currency and will remain a very stable currency in the coming weeks, in the coming months and in the coming years. We have instruments to deal with the financial crisis, we have instruments to deal with those spreads, and we have instruments to be aware of the situation and to act on the right way. There should be some greater difficulties in the coming days. So I'm really quite confident that the Euro will remain a stable currency in the coming days, in the coming weeks, even if we have to take some concrete actions to ensure that it remains a current currency. But I'm not worried about it. Frankly speaking.

[Event Moderator]

I don't think we've ever managed to get a French minister or policymaker yet to tempt them onto the terrain where they would say the Euro is in danger. It won't happen this evening either, but I'm glad to hear that it's not in danger. Okay, yes, I'll take the gentleman there.

[Bruno Le Maire]

You can include first year Economics Royal Hallway in US or London. We are all aware of the positive sides and benefits of EU integration. But what is, in your opinion, the opportunity cost of this integration? Maybe the possible adverse effects.

[William Horsley]

Thank you.

[Bruno Le Maire]

I don't know any adverse effect of EU integration. You just have positive effects, if you are quite honest with the EU integration, and if you are looking at the situation of countries like Spain, like Greece, like Portugal, and if you are looking at what those countries have achieved in such a short time, the conclusion can only be that EU integration is a positive step for every country which has decided to enter the EU and which has decided to become an EU member.

And that's why you have so many.

Countries trying to enter within Europe. This is really an evidence that today, facing the crisis, facing the current social situation, Europe is a solution to the crisis. And Europe has its own attractiveness and will remain very attractive for many countries which are just at the border of Europe. I'm speaking about Ukraine, I'm speaking about Georgia, I'm speaking about Turkey, I'm speaking about the Balkan states, for example. We have to be proud of what has been achieved within Europe. Looking at the rest of the world, you have to be proud of what has been achieved within Europe. There is a sentence by Voltaire, but I just know the sentence in French. Do you understand French? A little bit, oui. So I will allow to just say a few words by Voltaire in French plus je meau regard. The more I'm looking at myself plus je maquette. The more I'm worried. Pluja de comparable. The more I'm comparing with others.

And I think.

The more I'm comparing myself with others, the more I'm confident that's exactly the situation in which Europe is today. The crisis is striking every country around the world. And I'm quite confident that Europe will be able to face a crisis and will be able to support the consequences of the crisis, provided that it enters into cooperation and into solidarity in the next month.

[Event Moderator]

We've had nice tries from our last two questioners. We're not going to get a French minister to say that European integration is a bad side either, but we'll keep trying. Okay, so who else? Gentlemen, that in grey.

[Mark Langdon]

Okay. Infrastructure investment has been.

[Event Moderator]

Who are you?

[Mark Langdon]

Oh, sorry, big one. Mark Langdon, architect. Infrastructure investment has been proposed by a number of countries across Europe and also in the United States as a potential catalyst to mitigate the economics of situation that we're in, to stimulate activity, et cetera. France has always been very forward in infrastructure investment.

[Event Moderator]

Speak up a little bit.

[Mark Langdon]

Proposals of that nature and I was just wondering to what extent the Minister considered that there is a pan European strategy for infrastructure investment being considered across European countries currently.

[Bruno Le Maire]

Yeah, this is a very good question. There is a European strategy to support investments, infrastructure investments, which are today needed to support the economy. In my opinion, this strategy is not enough. Nobody is responsible for it because we don't have the budget to support those investments at the EU level. But in the future we would need a higher European budget so that we can engage into that kind of investment, which are to me the best response, the best answer to the current crisis. Investment in railways, for example, investment in roads, investment in nuclear plants. That's really the good answer to the crisis. These investments are made at initial level. Today these investments are made by the uk, By France, by Germany, and they have been decided by many governments around the world and especially within Europe. What would be a good answer would be to have the same kind of investments decided at the level of the Commission, provided that there is the budget to support those new investments. And I think that we really should think about the reinforcement of the budget in the future, the budget of the eu, so that if we have to face another crisis or if we have to reinforce and to support that kind of investment at national level, we could also provide EU fundings. This could be today something very useful.

[Tricia]

Mr.

[Event Moderator]

If I may put a question to you, you drew a distinction between this sort of mental mindset which you called protectionism as a matter of whose symptoms are xenophobia. You talked about thinking in terms of barriers, borders, and so on. This has become, I mean, quite noticeable in French discourse, this strong repudiation of protectionism as a creed. But there is of course still a robust defense of protections, or as you put it, limited, controlled and proportionate defensive measures. The problem, as you know, is that measures never look limited, controlled and proportionate to all the countries who are affected by such measures. And I put it to you that such measures, even in these times, and notwithstanding no doubt growing public support for such measures, those measures are, even in the limited way you describe, are a dangerous and high risk road to go down. So I just wondered if you could maybe just draw out a little bit more this distinction that you're making between legitimate, reasonable, moderate measures and full blown protectionism.

[Bruno Le Maire]

The problem is that in a perfect world we should avoid any kind of measures linked to protectionism, but we do not live in a perfect world and we have to find balance between, on the one hand, the request of the people. And you know that I used to be an MP in Normandy, as you just said, and I have this direct link with the people on the ground, as we say, you have to find the right balance between the request of the people and the questions put forward by the people and the requests of the other nations, and for example, the request of nations in Africa or requests.

Of nations in Asia.

If you give the impression to the people in your nation that you are not doing anything to preserve and to protect the interest of your industries, of your automotive industry, for example, and that you are just staying here on your chair waiting for economical attacks from other countries, you really want the risk of supporting xenophobia, extremism, far right wing parties. And this is today a danger we have to keep in mind, because this is a danger that could be a reality and could become a reality in a very short time in EU member states like France, like the uk, like Germany. So I'm not in favor of protectionism, as I said. I'm just in favor of European measures, measures decided at the European level that.

Would prove to our citizens that we.

Are really taking into account their fears and their worries and that we are trying to, to protect our European economy. We are trying to give some support to our industry. This is a very difficult balance we have to find. But this is not protectionism. Protectionism means today that the UK would.

Take some very concrete measures just to.

Protect one of the its plant in New Hampshire, for example, or around London.

Or that France would take some very.

National measures just to protect one of its industry or one of its plants in Normandy or in the south of France, without taking into account the interest of the UK and Germany and Spain and Italy. That's the difference between the two ways of protecting industries and protecting our economies. I know that the line is very difficult to draw, but I think that the right way of dealing politically with this question is to find the right balance between protecting our industry, doing our best so that industry can live a little bit more and doing nothing, which would be very hazardous in these very difficult times. I just give a concrete example, the concrete example, which is to me the best example of what we need today is the automotive industry. If we don't take any kind of measure to support the automotive industry in France, in the uk, in Spain, and in Germany, and also in Italy with fiat, the automotive industry in Europe will disappear in a few months, or let's say in two years, just because the US on their side have decided to give more than $25 billion to General Motors. Direct head, direct help to General Motors of 2 of $25 billion. If we just say, well, there is a problem with the US they should not give $25 to General Motors. That's something unacceptable. And I'm not happy with that kind of measure. If we just say this, letting our industry, automotive industry in France and Germany to die in a few months, I can assure you that we run the risk of having very big political troubles in a few months or in a few weeks. That's why we need to support our automotive industry, even if it is not allowed by the Commission today. We have to find the right balance, but we have to support our automotive industry.

That's really the line we have to.

Draw between saving our industries, doing our best so that no industry disappear in the coming months, and doing things that would only mean that we are attached and that we are in favor of protectionism. I know that the difference is very hard to see and very hard to draw, but this is the difference between protectionism as such and defending our industry.

[Event Moderator]

Thank you for that very helpful elaboration. Thank you. Yes. Okay, the gentleman there and then I'll go back to that side and see if I've missed anyone. Over there, please. Gentleman in the stripy red shirt.

[Economics Student]

Thank you, Minister, for your talk. You stressed in your talk about the importance of fear fiscal stimulus. And I was wondering on the European level if there's been any. If that's an area where the European Union can take leadership in fiscal stimulus, such as reducing interest rates, reducing taxes, increasing government spending in order to help the global economy as well as the European economy.

[Bruno Le Maire]

You know that the Commission has not the right to intervene in the fiscal field. And that's why Member states have decided on a national basis to take some measures in the fiscal field. The UK for example, has decided to reduce its vet. And Germany could do the same in some very specific fields. But the Commission is not allowed to intervene in that very specific field. I'm deeply convinced that in the future when I'm speaking about cooperation and coordination of economic policies, we will need to have that kind of coordination among Member states. Because it is very complicated to explain to our citizen that in Germany they have decided to reduce their VAT on some products and that in France we are not able to do the same. So we will have to need that kind of cooperation. I give you another industry linked to the automotive industry. You know that many countries like Germany and France have decided to support the demand with primalacas. How do you say that in English? Scrapping scheme. I think, yes, they have decided to put some scrapping schemes to help the demand in France and in Germany. The amount of this scrapping scheme is. Is around €2,500 in Germany and €1,000 in France and I think €800,000 in Italy and €1,500 in Austria. There are so many differences in supporting the demand, and that's a problem, because this is not a fair competition. If you want to have a fair competition to sell your cars within the European countries, you. You need to have the same scrapping schemes. That's a very important point. So this is an illustration. And the crisis, the current crisis is an illustration, a very concrete one, that we would need more cooperation and more coordination among member states, even in the field of fiscality and the field of interest rates, VAT and scrapping schemes like this. This is very important so that the game remains a fair game.

[Economics Student]

Thank you.

[Event Moderator]

Yes, Elif.

[Elif]

I'm also a student at the European Institution. I have two very quick questions. The first one is about the non existing opportunity costs of European integration. You said that we look at ourselves and we feel more confident, but you were also very hesitant about any future enlargement. What do you think that Hesitance says about the confidence of the current state of things within the eu? And my second question is about the case of Turkey, although you said that it's not. The Mediterranean Union is not necessarily an alternative to full membership. It's been perceived as such by many in Turkey. And do you think that perception is a valid one? And would you propose any way of engaging with it? Thank you.

[Bruno Le Maire]

Don't you have more simple questions? No. On European integration and the very difficult task of enlargement, I would like to be very clear on that issue, which is a very important one. We have made very important enlargements for many years, and we have to support those enlargements. But we also have to look seriously at the question and ask whether our citizens are ready to accept new member states in the coming years. My impression is that our main task is to reinforce the integration among member states. Then we would be ready, of course, to accept new members which are members of the European family, I would say. And I'm thinking, of course, on Balkan states, I'm confident that in the very close future, Croatia will become a member of the eu. And that's a good thing for the eu, because Croatia is a full member of the European family, provided, and this is a prerequisite, which is very important, provided that the Lisbon Treaty has been adopted and ratified by every member state. We cannot say on the One hand, we have a problem with European institutions. The European institution do not work. They are not strong enough to make the CAR ready and to support the difficulties, to face the difficulties we have to face. We cannot say this on the one hand and on the other hand pretend that there is no problem for accepting Croatia and other countries without having new institutions that are already proposed by the Lisbon Treaty. That's really a quick question. France is ready to accept new member states from the Balkan states, especially Croatia, which is ready for full membership, provided that we have those new institutions. Provided that we have those strong institutions that help the whole machine to work on Turkey. On Turkey, the question is quite different and you know that this is one of the question on which we did not find a consensus with the uk. But that's also what is interesting in the relationship between the UK and France. That's not only the consensus, but also the differences. And there is a difference of approach regarding Turkey because our assessment is that Turkey today is not ready to become a full member of the EU family and our assessment is that Turkey won't be ready to become a full member of the European family in, in the next future. So we have to find other ways to cooperate with Turkey, which is a very important country, which has borders with very important countries and very difficult countries like Iraq. We have to find this way of cooperating with Turkey, of associating Turkey to the economical social development of Europe, but without, without opening the door to a full membership. Today I'm just underlining the point today. That's the French position. I know that the UK is considering the situation on the far different way, but that's, as I just said, the interest of talking with the uk.

[Event Moderator]

Hopefully we'll have time for just two more questions. So I'd like people to come to come forward. My goodness. Two of my students put their hands up exactly the same time. I'll never be forgiven by the one who I don't. So I'm going to ask Diane and Clemence to both ask the last two questions.

[Tricia]

Thank you very much. Dian D5M student 3 as a European Institute, I'm wondering about the who are the crucial actors for this crucial year? Meaning? Well, we all know that Czech presidency is very much criticized. So is there a need for a French, German, British team to act as a directory for Europe? And if yes, would that be accepted by other member states? And would that be working in the sense of common position finding agreements?

[Event Moderator]

Thank you.

[Bruno Le Maire]

I only have good questions. That's great. Everybody is a key actor when you are facing such an important crisis. When I say everybody is a key actor, I'm thinking about the Czech presidency, which is playing its role with, I think, a lot of success. People are criticizing the Czech Republic, but I think they're doing it the wrong way. This is not the right way of associating the Czech presidency to the work we have to do to face the crisis. Of course, this is not something surprising, but the Czech Republic is not Germany, France or the UK. They do not have 60 million people, they do not have the same administration, and they do not have the same role on the international stage. But why should we criticize the Czech Republic to be the Czech Republic? Because that's the point. When you are criticizing the Czech Republic not to play its part on the international stage and not to play its role as the EU presidency, you are not criticizing the EU presidency as such. You are criticizing the Czech Republic as such. You are saying to the Czech, you should not be Czechs, you should be French or British or German. That's why you will never hear a minister like me criticizing the Czech Republic. I really think that they are doing their best and that they are doing quite well. Facing the gas crisis, for example, I think they have done it really quite well.

Everybody is a key actor.

I'm thinking about Czech Republic, the. The Commission, of course, and I'm very happy to see that today Juan Manuel Barroso gave a very interesting interview to Dietzeit in Germany. Underlying the point that the Commission has to play fully its part to face the crisis and has to put forward some new proposals on the table so that we can face the crisis in the best circumstances. And of course, to me, the big states, even if a French minister should avoid the word big states, but speaking to a British assembly, I think it is not a problem. The big states have big responsibilities. That's so simple like that. And when I'm thinking of big states, I'm speaking about Germany, France, the uk, which are the three main countries of the eu. They have to cooperate together, they have to discuss together, they have to put proposals on the table just to face the financial crisis and to propose some new rules, to propose a new financial regulation. And we know, we all know within EU member states that if there is no agreement between the uk, Germany and France in this field of the financial regulation, there won't be any kind of new financial regulation in the world. We have to go ahead step by step.

We have to find an agreement between.

The uk, France and Germany. Then we have to enlarge this agreement to other countries like Spain and Italy, and then to enlarge it to all the member states. And that's the way of building a unified position between EU member states. And if we get a unified position between member states, then we will have a good discussion with the US and then we will be able to propose new rules and new financial regulations. But if we are not able to do it, and to do it in the very short term, because the London Summit will take place at the beginning of April, mid April, if we are.

Not able to do it on a.

Very short term, then we will go to the London Summit divided and divided. We won't be able to put forward our proposal and to support our common proposal. That's really a key point.

[Event Moderator]

I am normally mad at my words, Clemence, but I'm afraid I'm going to have to let you down. It is 7:30. The minister does have to leave for the airport. Minister, you professed yourself unsettled by some of the very sophisticated questioning from an LSE audience. I'm sure you were expecting that quality of questioning. In fact, you gave us admirably full and interesting answers and we didn't manage to wrong foot you. So you've given us an excellent hour and a quarter and I hope you'll come back to LSE and share your thoughts again. You will be very, very welcome.

[Mark Langdon]

Thank you.