No two days resemble each other for (DP), who wears four hats--minister for foreign and European affairs, foreign trade, cooperation and development, and the Greater Region--juggling time zones and dossiers. But they’re four hats that fit together.
Paperjam: What issues are you currently concerned about?
Xavier Bettel: There is not one that concerns me more than another. They are all linked. The Greater Region is essential to our economy. And it is the good health of the economy that enables me to finance my cooperation policy. This policy of cooperation and development is an essential component of our foreign policy. And the foreign trade component enables me to attract companies to the grand duchy and ensure its prosperity. Everything is linked.
But if you want to talk about priorities, the top priority for me is to preserve and develop Luxembourg’s DNA, marked by the culture of dialogue, exchange and respect. Today, I think it is important to maintain this ability to listen and show respect.
Amongst the major issues shaping the news today, there are the threats to the economy posed by the development of the tariff war initiated by US president Donald Trump. What do you think would be the best response from the European Union?
Europe absolutely must react and remain united. We cannot afford to remain passive on this issue. The European response must be proportionate and considered. There would be no point in launching into a spiral of one-upmanship. It would be a mistake to sever all ties with the United States. Donald Trump is here for at least four years. It’s important to keep the channels of communication open so that we can sit down and talk.
I’ve said it before--and I’ve been shouted at for it--if we’re too weak, then we’ll get eaten, but if we refuse to negotiate, we’ll get killed. I haven’t changed my mind. When dealing with Donald Trump, we need to whet his appetite by offering him promising development prospects elsewhere. In short, explain to him that it’s better to spiral in the right direction than in the wrong direction. That’s how I worked with him for four years when I was prime minister.
That said, I deplore the current situation. It’s a situation where, in the end, it will be European and American consumers who will pay the price. Americans elected Donald Trump because he wanted to stop inflation. Increasing customs duties will have the opposite effect, and the billions he hopes to collect will have to be ploughed back into the economy to support it. I hope that reason will soon reassert itself.
In the event that reason does not prevail, what would be the economic impact for Europe and Luxembourg?
There are too many uncertainties at the moment to be able to make reliable projections. This is not the time to play Nostradamus. But as I pointed out, this situation is in nobody’s interest. And not Luxembourg’s either. If the European economy starts to cough, we will cough too. Just as we will cough if the US economy weakens.
For all economic operators, the key word is unpredictability. I have had discussions with many Luxembourg companies, but also with European companies that are not necessarily based in Luxembourg and that are wondering whether it would be a good idea to move across the Atlantic to serve the American market. Just as American companies are reluctant to come to Europe for the same reason. I believe that companies on both sides will choose this strategy. But they have to be able to afford to produce on both continents. It’s a little game at the end of which there will be no winners.
Can this period of tension have any beneficial effects for the European economy?
I think so. It highlights, after the covid episode and the embargo on Russian gas, that the European continent must take its destiny into its own hands and no longer rely exclusively on the help or goodwill of so-and-so.
And this raises the question of why Europe has failed to develop major global players in key areas of the economy. Google, Amazon, Apple, Paypal and Meta are American. Samsung is Korean. When it comes to artificial intelligence, the choice is between American or Asian solutions, and Europe is stuck between the two. There’s nothing equivalent in Europe. And for me, this is mainly due to a competition policy that is now outdated in relation to a global market. We’re punishing ourselves. In Europe, you can’t get too big. As a result, we’re still a pea in a pod on the world stage. It seems that the von der Leyen Commission wants to review this. We support her on this.
To preserve and defend multilateralism, we need to reinvent it
Do you think the golden age of globalisation is over?
It goes beyond that. The whole international order is currently being called into question. The rules of the United Nations, the World Trade Organisation and the decisions of the International Criminal Court are being flouted. More than globalisation, it is multilateralism, understood as the will to work together, that is under attack. I believe in multilateralism. Luxembourg owes its prosperity to it.
To preserve and defend multilateralism, we need to reinvent it. The UN Security Council and its five permanent members were established in the aftermath of the Second World War. These countries were the guarantors of peace. Today, there are quite a few troublemakers on the council. The Security Council is like the UN’s board of directors. But it is not accountable to the General Assembly. In fact, the opposite is true. That has to change. We could imagine the General Assembly having the final say, possibly with a qualified majority. For me, the reinvention would be to find rules that are better adapted to reality.
Is the system reformable?
I believe so. Luxembourg is participating in the intergovernmental negotiations on the reform of the Security Council that are taking place within the framework of the UN General Assembly. This forum is known as IGN, an acronym for intergovernmental negotiations. We support a reform aimed at making the Security Council more representative and more effective, in particular by enlarging the number of permanent and non-permanent members of the council. Luxembourg speaks in coordination with Belgium and the Netherlands on behalf of the Benelux countries. We are promoting a common position in favour of a Security Council that is more transparent, accountable and responsive to international crises.
The decline of multilateralism has a tangible consequence on Europe’s doorstep: Russia’s war in Ukraine. A war that raises the question of European defence. What do you think would be the ideal architecture for European defence?
The thing that seems most urgent to me is to build a common security industrial policy. This is a sentence I never thought I would have to utter one day. It’s sad... We have 17 models of tank in Europe. There is one in the United States. We have 29 classes of frigates, the United States has five or six. Why not transpose the Airbus model to this sector? It would generate huge economies of scale and better interoperability in the field.
When this subject is raised, politicians’ responses point in two directions: a common industrial policy and common funding. But what about a common army? Because at the end of the day, you need infantrymen to handle all these weapons that have not yet been produced.
We already have joint exercises under the aegis of Nato that allow good coordination on the ground. After that, if we want to develop a European initiative--and Luxembourg is not opposed to this--we must avoid creating something that duplicates the Atlantic Alliance, a white elephant that would be a kind of Nato bis. I think it’s important to defend this organisation and I think it’s also in the interests of the United States, because Europe is the United States’ biggest customer for military equipment and armaments.
Nato is not just about defence; it’s also about deterrence. Emmanuel Macron’s initiative to extend France’s nuclear umbrella to European countries that so wish is a commendable one. But I think we really need to keep nuclear deterrence at this level and avoid giving the impression that Nato is becoming moribund. If we bury it ourselves, it’s over.
Does Europe have the financial resources implied by its leaders’ desire to have a “whatever it takes” policy like the European Central Bank has?
I believe that we are facing an exceptional situation that requires exceptional responses. Tradeoffs will have to be made, but it is better to invest massively now with the aim of ending hostilities than to continue to finance a war that will drag on from day to day.
In the current peace negotiations between Kyiv and Moscow, we get the impression that Europeans are being excluded. Has Europe’s voice become negligible?
I am lucky enough to have good contacts with the Saudi foreign minister who keeps me informed. It seems that the United States wants Europe to be brought back into the process once sanctions are to be discussed. That’s the minimum! Earlier, I was talking about reforms at UN level. We also need to make reforms at European level so that Europe’s voice carries more weight.
I would like--and I am going very far in my thinking--that during the European elections, alongside the choice of national candidates, European voters could vote for transnational lists of 27 candidates. The winner would have priority in trying to form a majority in the European Parliament and be appointed president of the European Commission. And we should be able to vote for the person who will become president of the European Council.
The decline of multilateralism is also being felt within the EU’s borders. How do you view the increase in internal border controls?
Internal border controls are the exception. The problem is that for some, they are becoming the rule. They think it will curb the extreme right. Unfortunately, many politicians and parties forget that imitating the far right only makes it stronger. When people have fears, which is legitimate, we have to listen to them and provide answers. And we must also ensure that the Dublin agreement works. That’s not the case today. But to throw overboard this success, which is freedom of movement in Europe, is disproportionate. It’s not by putting two jokers at the border that things are going to get any better...
Other, more subtle obstacles to free movement and to the functioning of the EU seem to be multiplying. Take, for example, French attempts to reduce benefits for unemployed cross-border workers. Cross-border commuters will be subject to stricter rules on what are known as reasonable job offers. These are offers with French social and salary conditions that they will not be able to refuse outright. What is your view of these new measures?
I’m going to tell you honestly--and this won’t please everyone--but if an unemployed person is offered a job, it is in their interest to take it. We must encourage employment rather than encourage unemployment. I understand that social and salary disparities are problematic compared to the unemployment benefits they may receive, but for me, we are better off when we have a job.
This article was originally published in .