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EU Leaders Give Themselves Six Months to Map Out Bloc's Future

By Kevin Costelloe and Claudia Rach

June 25 (Bloomberg) -- The 27 countries of the European Union gave themselves six months to decide between consensus and the squabbling that almost sank a summit in Brussels.

EU leaders agreed at the Brussels meeting to negotiate by the end of this year a new governing treaty to guide the 50-year- old bloc and any future members. The summit, though, ran into an unscheduled third day and came near to collapse until Poland yielded to pressure to scale back its call for a greater say in EU decisions.

``In many years I have never seen with such distressing clarity the existence of two Europes: one, the majority which believes in it and wants to go forward; the other which pursues a reduction of the role of the EU as a national political objective,'' Italian Prime Minister Romano Prodi said in an interview with the newspaper la Repubblica published yesterday. ``It's good that these two Europes, despite everything, have stayed together.''

Negotiators will now need to maneuver among obstacles created by specific national demands, popular skepticism toward the EU and the gap between western nations and the formerly communist countries in eastern Europe. Above all, the talks will require member states to show a dedication to common EU principles, something that's becoming more difficult as the bloc expands.

``The fact that all 27 member countries came to an agreement is very important,'' Dutch Prime Minister Jan Peter Balkenende said on the morning of June 23 after an all-night summit bargaining session in Brussels. ``The most important is the willingness to cooperate and come to a conclusion.''

Croatia, Turkey

Plans to resume preliminary membership talks with Turkey and Croatia this week will highlight the EU's need for a new set of governing guidelines.

The near-collapse of the summit reawakened concern that the EU, with an institutional setup that allows single countries to block sensitive decisions, is failing to come together to project its influence.

Still, EU leaders were able to map out the basic elements of a new treaty, which is intended to replace the constitution that was rejected by French and Dutch voters in 2005 and never went into effect.

The new rulebook will create the posts of permanent president and foreign minister and streamline the system for passing EU laws. Once the details are agreed, the leaders pledged to ratify it in time for the European Parliament elections in 2009.

Voting System Delayed

Outnumbered in Brussels by 26 to one, Polish President Lech Kaczynski finally said he would back a shift in the EU's policymaking system that he had criticized for handing too much power to larger countries such as Germany.

Poland signed up to the compromise after getting the final adoption of new voting rules pushed back until 2017. Each country will retain a veto over sensitive areas such as taxes and foreign policy.

Negotiations in the next six months over the final version of the treaty won't be ``a pure formality,'' Slovenian Prime Minister Janez Jansa said. ``This won't be a very easy job.''

Summit leaders also yielded to a French request to delete from the proposed treaty wording making ``free and undistorted competition'' an EU goal. The deletion immediately raised questions about the EU's commitment to open economic competition, and led Competition Commissioner Neelie Kroes to issue a statement saying she would keep enforcing the rules ``firmly and fairly.''

``We need unanimity in the end but not at the beginning.'' Jo Leinen, a German member of the European Parliament, told reporters as the weekend negotiations appeared to be deadlocked. ``We now have a few more months for negotiations and intelligent ideas for the voting system -- how to find a formula that satisfies everyone.''

To contact the reporters on this story: Kevin Costelloe in Brussels at kcostelloe@bloomberg.net; Claudia Rach in Brussels at crach1@bloomberg.net.

Last Updated: June 24, 2007 19:46 EDT

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