What to Watch: All Eyes on Europe as the Transatlantic Community Meets at Various Summits

The transatlantic community is gearing up for a marathon of diplomatic events: a G7 meeting, NATO leaders meeting, U.S.-EU Summit, and a bilateral between Presidents Biden and Putin. Experts across the German Marshall Fund’s U.S. and European offices weigh in on what to expect throughout the week, and the dynamics at play as President Biden seeks to regain trust amongst partners while confronting a raft of challenges.

Setting the Scene: Transatlantic Trends

Alexandra de Hoop Scheffer, Director of Research, Director, Paris Office

As President Biden heads to Europe for his first trip, he can count on a strong alignment of transatlantic public opinions on the 3Cs of his agenda: COVID-19, Climate, and China, as revealed by the Transatlantic Trends 2021. Across the 11 countries surveyed, pandemics and climate are perceived as the top issues for transatlantic cooperation, while China’s influence in global affairs is a growing concern, with shared support for a tougher stance, especially on human rights, cybersecurity, and climate change. The “European awakening” to China’s geopolitical challenge is seized by Washington as an opportunity to foster closer transatlantic cooperation, in both NATO and EU-U.S. frameworks. However, the survey also shows that the effects of the Trump presidency are still perceptible, especially in Germany, and that rebuilding trust with European allies will take time. The big question for the leaders’ gathering at the G7, NATO, and U.S.-EU summits is whether they will be able to translate the public’s desire for closer transatlantic cooperation, including on tech, into concrete initiatives.

Biden’s Democracy Agenda Summit Launchpad 

Jonathan Katz, Director, Democracy Initiatives – Washington

The upcoming summits are critical launchpads for President Biden’s global democracy and human rights agenda. Since taking office in January, the Biden administration has tactfully laid the foundations of a democracy strategy both at home and abroad. To achieve his goals and to create more stable and resilient democracies, Biden knows he needs to get G7, NATO, and EU partners in lockstep. This effort initially was met with some reluctance, which the Biden administration acknowledges, given the impact of four years of ally bashing and authoritarian coddling by the previous U.S. administration. Washington’s summit partners also have one eye on the health of U.S. democracy and are carefully watching the ongoing efforts by some Republicans, and former President Trump, to undermine previous election results and pass new and restrictive voting laws in several states. 

Despite challenges in the U.S. and early reluctance by some U.S. allies, the Biden administration’s push on democracy, human rights, and countering autocracies is likely to get a boost at the upcoming summits. We should expect to see official statements at these three summits and new commitments that will advance the Biden administration's democracy agenda. We will also likely see an increased willingness from European and global partners to be more vocal in standing up for democracy and meeting Biden’s “call for action” to advance rule of law, combat corruption, and advance human rights.

Two Big Opportunities at the NATO Summit

Kristine Berzina, Senior Fellow, Alliance for Securing Democracy – Brussels

The NATO Summit will be important for two overarching reasons. The first: The Alliance is coming together to prove that it has weathered the storm of the previous years, from President Trump’s questions of the Alliance’s utility to President Macron’s accusations of brain death. This summit, the first of Joe Biden’s presidency, will show the alliance as strong and whole with a fully committed and reliable United States at the center. With many Europeans still trying to shake off bad feelings from the Trump years, a solid show of commitment is no small thing.

The summit also presents a second opportunity: for NATO to launch itself into a new strategic re-think to better maneuver itself against new threats. The allies will decide whether to move forward with drafting a new strategic concept, one that addresses the hybrid and unconventional threats NATO is facing. How should NATO address new disruptive technologies, disinformation, and attacks against democracy? How does it address China’s toolkit—while China’s military strength in the Pacific is a concern that is largely outside of NATO’s scope, how will allies address risks to infrastructure and society within NATO? This strategic moment and summit is an inspiring and necessary next step for NATO. 

Reality Won’t Bend Easily for NATO Leaders

Thomas Kleine-Brockhoff, Vice President, Berlin Office

Leaders at the NATO Summit wish to show that the Western Alliance is neither braindead nor obsolete, and that it knows how to tackle new challenges. The summit will aim to give the U.S. president language on China and NATO’s secretary general a go-ahead for a new strategic concept. Militarily strong, politically united, and responding to changes in the global environment: That is the image that the alliance will want to convey. But characteristically, reality does not bend easily to the will of the NATO leaders. To achieve the political unity that they all crave after years of divisions, NATO will need to improve the consultative processes to try to better align threat perceptions and goal definitions. Strengthening collective defense is as high up on the agenda as it was at the Warsaw and Brussels summits in years past, even if the term “two percent” may not figure as prominently as before. As it has done since the London summit, the alliance will inch towards defining the military component of the China challenge, and what it means to a regional alliance with a defined goal and area of defense commitment.

In Central and Eastern Europe, Fears of Biden “Sleepwalking” into a Russia Reset

Michal Baranowski, Director, Warsaw Office

Even though Biden himself and members of his administration have been rhetorically tough on Putin (after all, Biden called Putin a murderer), more and more analysts and politicians in Ukraine and Central Europe worry about the administration "sleepwalking" into another reset with Russia. This argument is strengthened by two factors. First is the lack of any substantial consultations with Eastern Europeans ahead of the Biden-Putin meeting, a topic discussed at length by Ukraine’s President Zelensky in a recent interview with Politico. The second factor is the announcement of the Biden administration’s de facto approval of the completion of Nord Stream 2 pipeline—a decision that again came without any prior heads up, and which favors German and Russian interests without considering the vital interests of Ukraine, Poland, and other countries in the region that the NS2 violates.

The strategic and political community here in Central Europe will be carefully watching the outcome of the Biden-Putin meeting, but the lack of American consultations in the CEE region is already causing damage to the bilateral relationships.

Only a Brief Sugar High for U.S.-EU Economic Relations

Peter Chase, Senior Fellow – Brussels

President Biden hopes to use the EU-U.S. Summit to improve the tone of transatlantic economic relations, but Europeans will likely walk away from the meeting disappointed. This slight pall will arise even though the U.S.-EU Summit will benefit from feel-good pronouncements from the G7 Summit and the sense that Biden is serious about global warming and “fair” corporate taxation. And it will arise even though the two sides will announce the “EU-US Trade and Technology Council” proposed by the Europeans last December.

While this Council should help create a more favorable context for resolving bilateral trade problems and for promoting their ability to deal with the China challenge, Washington is not yet ready to eliminate the tariffs President Trump imposed on European steel and aluminum for ostensible “national security” reasons, which Europeans see as a minimal step. They also reject Washington’s approach to resolving the Airbus-Boeing dispute, which puts all the onus on Airbus rather than giving the company fair access to the United States’ huge defense procurement budget for true national security benefits. Washington for its part justifiably questions European transgressions, on Airbus, agriculture, data protection, digital taxes, and other policies “against” U.S. tech firms.

So while the EU-U.S. Summit may bring a quick sugar high, this is likely to quickly descend to another low as former patterns of behavior re-emerge. To avoid this, the two sides would need a renewed vision for the transatlantic relationship…which this summit is alas unlikely to bring.

New Global Tax Rules and Other Reform on the Horizon for the G7

Jacob Kirkegaard, Senior Fellow – Brussels

G7 summits have, since being supplanted by the G20 in 2008, substantively focused on financial issues. This year will be no different, as advanced economy leaders prepare to sign off on a historic proposal to reform the global rules for who gets to tax what companies, and by how much. By agreeing on a two-pillar proposal to implement both a 15% global minimum tax on multinational firms, and allocate some of the profits of the world’s largest and most profitable companies to the countries in which they make their sales, G7 leaders will take a crucial first step towards undermining tax havens’ economic model, avoid a destructive trade war between the U.S. and much of the rest of the world, and possibly improve the general public’s perception of global multinational firms’ behavior and capitalism itself. G7 leaders will further offer the first guidelines for financial firms’ coming mandatory climate-related financial risk disclosures and global reporting standards for sustainability to hopefully be decided at COP26 in November. And they will seek to establish common principles for the operation of future central bank digital currencies (CBDC) aimed implicitly at curbing the recent growth of crypto currencies.

China on the Agenda at the U.S.-EU Summit

Bonnie Glaser, Director, Asia Program – Washington

The inaugural U.S.-EU Dialogue on China last month provided a timely opportunity to exchange views and tee up key issues for the June 15th summit in Brussels. The list of shared concerns is long and growing. Priorities for engagement with China include climate change and non-proliferation. Biden is determined to forge a coalition with Europe to push China to adopt more constructive policies.  

The EU will welcome Biden’s core message that the allies are unified around shared values and commitment to democracy but will be leery about getting on board with an overly confrontational approach to China. The pursuit of strategic autonomy and preserving the benefits of close economic ties with China remain key drivers of EU policy, and Biden’s stark portrayal of a global ideological divide between democracy and autocracy is discomfiting. Nevertheless, both at the US-EU Summit and the G7, there will cooperation on many issues related to China, though not necessarily branded as such, including the Clean Green Initiative and the plan to launch a Trade and Technology Council, which is designed to strengthen coordination on technology rules and standards, exports controls, supply chains, and 5G. The bottom line is that while gaps exist in American and European views of how to respond to challenges from China, there is significant convergence in assessments of those challenges and a shared desire to work together to produce positive outcomes.

Can Biden and Putin Bridge the Gap?

Michael Kimmage, Non-Resident Fellow

For the Biden administration, the summit with Putin, scheduled for June 16, is an excellent idea. There is no reason for the United States not to engage in the normal give and take of diplomacy with Russia, and yet over the past decade or so the diplomatic relationship has deteriorated to a remarkable degree. This is true on the presidential level. It is even more true for the mid-level diplomatic and national-security bureaucracies of both countries.

The Putin-Biden summit will not accomplish much: The mutual mistrust is too great. And neither side will come in willing to make concessions. The simple fact is that in terms of interests and worldview, the United States and Russia are extremely far apart; but that is precisely why they need to establish a regular and workable diplomatic contact, through which viewpoints can be exchanged and red lines articulated. The point is not cooperation, an unrealistic prospect for the U.S.-Russian relationship. The point is the avoidance of costly, uncontrollable conflicts.

In cyber space, Russia is exploiting the absence of any rules of engagement, persistently upping the ante. In Syria, the Russian and U.S. militaries are operating in close proximity though with different mandates. In Ukraine, the Minsk agreements are very far from having been implemented: The conflict, in which Russia and the United States are on opposite sides, is entirely unresolved. And in Belarus, a mad dictator can survive only if he can turn Belarus into North Korea. He is likely to fall in the process, and to fall sooner rather than later. Here, too, Russia and the United States are on opposite sides. Biden and Putin will resolve none of this in Geneva. But they can seek out mechanisms for avoiding the worst-case scenarios, something that is in the interest of the United States and of its European allies.