Abu Dhabi, UAEWednesday 24 July 2019

EU leader Juncker demands euro replaces dollar as US retreats

Brussels and Washington at loggerheads on a host of major issues ranging from the Iran nuclear deal to trade tariffs
President of the European Commission Jean-Claude Juncker delivers the State of The European Union speech.  EPA

Europe must strengthen the “international role of the euro” and become a more powerful “global player”, European Commission President Jean-Claude Juncker urged on Wednesday in his annual address to the bloc’s parliament.

With Brussels and Washington at loggerheads on a host of major issues ranging from the Iran nuclear deal to trade tariffs, Mr Junker said is time for Europe “to unite all the political, economic and military might of its nations” and strengthen its role at the stage of world politics.

Twenty years since its institution, the euro boasts the second place as the most used currency in the world and 60 countries pegging their currencies to it. But the recent disputes with Trump, who pulled out of the Iran deal and slapped sanctions back on Tehran in the teeth of strong European opposition, brought into sharp focus the need to boost the role of the euro as means to increase Brussels’ diplomatic power.

“We can and must go further,” Mr Junker said in what is known as Brussels state of the union speech. “It is absurd that Europe pays for 80% of its energy import bill – worth 300 billion euro a year – in US dollar when only roughly 2% of our energy imports come from the United States. It is absurd that European companies buy European planes in dollars instead of euro.”

He set a deadline to present initiatives strengthening the international profile of the euro before the end of the year. “The euro must become the face and the instrument of a new, more sovereign Europe,” he added.


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Mr Juncker made no direct comment on President Trump or US policy but condemned “selfish unilateralism” in the speech. He also saw new opportunities to work with China, Japan and others to develop “multilateral” rules.

Some proposals to strengthen the EU’s effectiveness face an uphill battle against member state opposition, notably scrapping national vetoes in some foreign policy areas, such as where economic pressure from the likes of Russia or China on certain EU countries has blocked EU sanctions to defend human rights.

Mr Juncker renewed calls for states to push ahead in developing an EU defence capability independent of the US-led NATO alliance and to embrace Africa through investment and a sweeping new free trade area — part of a strategy to curb the flow of poor African migrants which has set EU governments at each other’s throats and fuelled a sharp rise in anti-EU nationalism.

Without naming Hungarian Prime Minister Viktor Orban — whose government lost an unprecedented vote later on Wednesday to launch suspension proceedings from the EU — Mr Juncker blasted EU leaders who sought to undermine democracy and the rule of law. Indeed the EU president rejected complaints from lawmakers that the Commission has been lenient toward Hungary, Poland and other eastern states.

Updated: September 12, 2018 04:51 PM