The worst fears of Europe’s leaders have been realised: Ireland’s voters have scuppered the Lisbon Treaty, with 862,415 votes against and 752,451 in favour on a turnout of 53.4 per cent in the Irish referendum. Politicians can complain till the cows come home about small countries and slim majorities. After all, the Irish “no” voters represent maybe one in 300 of the EU’s voting population. But the people have spoken and Ireland cannot ratify.  The treaty will not come into effect at the start of 2009.

There will be no quick and easy solution. The vote was surely another demonstration of popular disdain of the political elites, which is widespread across Europe. It was not enough for all the major parties, the business organisations and the trade unions to argue for a “yes” vote. Their leadership was widely rejected.

I see that the Irish Taoiseach Brian Cowen says that this is Europe’s problem. That seems a bit of an understatement, also  known as passing the buck. But since nobody can identify particular issues which led to the Irish rejection I suppose Mr Cowen is saying that the Irish government can think of no specific changes which could be made to the treaty which would make it more palatable for a second referendum. There is no appetite in Ireland to repeat the double.
 
We’re back to the old argument about representative democracy versus the popular vote. The referendum drew in all kinds of extraordinary allegations about the treaty. One poster said it meant that children would all have to be micro-chipped. Some campaigners claimed that abortion would be legalised under the treaty and others that Irish youngsters would be conscripted for a European army.
 
Yet people’s commonest complaint was that they simply did not understand Lisbon and they refused to vote for something they did not understand. It’s a classic situation where parliament does seem the right place to decide highly complex issues. But it has to be based on the assumption that politicians have the trust of the people. To win the support of the people requires a vision, and there was little sign of that in the Irish campaign.

When French and Dutch voters rejected the Constitutional Treaty in 2005 enormous efforts were made by Sarkozy, Merkel and others to get the reform process back on track. It will be difficult to find the political will to repeat such a massive exercise, especially in a period when public opinion across Europe is increasingly preoccupied with prices, jobs and immigration. Two-speed Europe, referendum by-pass, Irish opt-out: none of them seems to provide an answer.

Most likely is that the treaty will be put to sleep for the time being and with it the next phase of enlargement. Business can continue as usual (the EU has been functioning pretty well since the 2004 enlargement) and efforts will be made to strengthen common positions on global issues like climate change, energy and foreign affairs, but it could be quite a while before there is a president of the European Council and a foreign affairs supremo bestriding the rue Charlemagne between the Commission and the Council.

We can expect the European Council on June 19-20 to call for ratification to continue, but the Czechs have already hinted that they want to suspend their ratification process.

Without the institutional streamlining provided by the Lisbon Treaty we can expect membership for the Balkan countries and Turkey to be seriously delayed and even put in further doubt. The painful challenge of setting a course for the EU in the aftermath of the Irish vote will fall to the French presidency, which takes office on July 1. Although the French will be frantically seeking a solution, putting enlargement on the back burner might not go down so badly in Paris.

“That’s the only cut this year!” quipped a council member when European Central Bank president Jean-Claude Trichet took the knife to the ECB’s birthday cake in Frankfurt on June 2. The occasion was the tenth anniversary of the Bank’s establishment. Apparently the mood in Frankfurt was of genuine celebration tempered by concern at the conflicting challenges which the Bank currently faces over inflation and growth.

It has been a long journey since June 1998. It’s strange to think that the decisions on who would join the euro zone were taken under British presidency in May ‘98. In the chair was Prime Minister Tony Blair, who had won a landslide election just twelve months earlier. He had to praise the significance of the euro, although he had decided against taking Britain into the new currency, a decision regarded by many people as one of his biggest failures given the strength of his position, and no doubt strongly influenced by Gordon Brown at the Treasury.

The most interesting drama at the time was over the ECB presidency. President Chirac demanded that Trichet, who was then governor of the Bank of France, should be ECB president, whereas Wim Duisenberg from the Netherlands was the consensus candidate.

The crisis was resolved with a classic fudge. I will be far too old to serve two terms as ECB president, said Duisenberg, but any decision to resign “will be my decision alone”. There was, however, an understanding that Trichet would take over once Wim had taken that his solitary decision. Chirac conceded. Relief all round.

When the French president pressed for Trichet’s appointment in 1998 he no doubt hoped that a more relaxed French regime would prevail over Germanic discipline, setting interest rates with an eye to boosting growth. In the event Trichet has staunchly defended ECB independence and its key mission: to fight inflation.  Trichet’s own appreciation of the ECB’s role, its record and the tasks ahead was summarised in his Frankfurt birthday speech.

The record of the ECB has surpassed expectations. Its handling of the sub-prime crisis since last August has impressed everyone and the euro continues to strengthen its position in global markets – as well as appreciating in value. It now accounts for around 25 per cent of foreign currency reserves across the globe and we can expect that to rise steadily. China, for one, is keen to increase its euro holdings.

May 1998 marked the creation of the Euro Group of ministers.  This group of 11 countries was expected to become a potent force in European politics and it was Britain’s exclusion from the club which many of us thought would be the biggest penalty for not joining the euro zone.

I can’t say it has turned out like that. For a start, total disregard of the Stability and Growth Pact by some of the biggest members caused deep divisions within the group. Not much solidarity there!

There has also been real divergence in the performance of the euro zone economies, both in terms of their growth rates and their inflation. Maybe the interests of the euro zone countries (15 of them now) are so varied that they will never be able to take common decisions on such issues as international exchange rates and the value of the euro, economic management or taxation policy. President Sarkozy, for instance, has called for a cut in certain VAT rates across the EU to put the brake on rising prices, but his finance minister Mme Lagarde got short shrift from colleagues when she put forward the idea at the recent Frankfurt meeting.

On the international front the Euro Group president, Luxembourg’s Juncker, has bemoaned Europe’s failure to speak with one voice in the IMF. The question is, what should the voice say? A high level delegation to China was hyped as a first example of euro diplomacy, but it does not seem to have amounted to much. Maybe that could be a role for the soon-to-be-named Council president – provided he/she comes from a member of the Euro Group. 

I see that Slovakia will be the next country to adopt the euro, as of January 1 2009, when it abandons the koruna. It has revalued its currency in advance as an anti-inflationary move. Political opinion in Denmark continues to move in favour of membership. A referendum would of course be needed, and Sweden is publicly stating that a positive Danish vote would open the way for Sweden to consult the people as well, at the earliest in 2011.

Which leaves the United Kingdom. Willem Buiter, former member of the Bank of England’s Monetary Policy Committee is in no doubt. In his view Britain should join now. The FT’s Martin Woolf strongly disagrees.

Buiter refers to the enormous external liabilities of the UK’s financial services industry – €400bn in foreign currencies in his estimate, which is four times the country’s GDP. The Bank of England, he maintains, could never act as lender of last resort for such liabilities. Joining the euro and depending on the resources of the European Central Bank is for him the only way to defend the UK from an Iceland situation, where vast liabilities have accumulated in proportion to the size of the domestic economy.

It’s a bit tough being compared with Iceland, but it does focus on some of the issues raised by the sub-prime banking crisis and the new perceptions of risk that we have to live with. But probably the biggest test for the ECB over the next 10 years will be how far the euro zone can handle its own internal tensions and the divergence of its national economies.

Allemagne quartorze points, Royaume-Uni 14 points, la Russie 272 points, Ukraine 230 points, la Grèce 218 points. So it was a runaway victory for the Russian entry in the Eurovision Song Contest, held in Belgrade on May 24, and oblivion for most west European entries. The centre of gravity moves further east. See you in Moscow in 2009!

Some (western European) commentators see the modern contest as a great conspiracy of political block voting, with the Nordics, the Balkans, the East Europeans voting for their neighbours and so swinging the results.
 
But it seems the reality is much more complicated. It reflects the complex ethnic mix in so many European countries. The fact that Estonia, Latvia, Lithuania and Ukraine each gave the full 12 points to the Russian entry (as did Israel) reflects the size of the Russian ethnic population in these countries rather than any political block vote.
 
Likewise for the former Yugoslavia, with its intermixing of Serbian, Bosnian and Slovenian populations. Bearing in mind that you cannot vote for your own national entry, what more natural than to vote for your ethnic identity? Douze points for the cousins. By the same token, Turkey always does well from the German voters, mirroring its population of 2.6 million of Turkish extraction, although I see that this year Greece took Germany’s 12 points and Turkey only 10.
 
If you managed to miss three hours of the actual final, then you can treat yourself to a (brief) taster of any of the finalists - and maybe decide that the outcome was not so unfair after all. There’s an amalgam of western pop and eastern music which can work rather well – and is maybe part of a changing European identity – an eastwards shift in our cultural centre of gravity.

Elation in Brussels at the unexpected success of Boris Tadic’s pro-European Democratic Party in Serbia’s general election has quickly turned to frustration as the Socialist Party, with 20 seats in the new parliament, decides whether to throw in its lot with the nationalist Radicals led by Vojislav Kostunica. Tadic’s party won the most seats, but not enough to form a government on its own. (Former ambassador to Belgrade, Charles Crawford, has forthright views on Mr Kostunica).

Both the Democratic Party and the Radicals are courting the Socialists. This was the party of Slobodan Milosevic, but it has greatly changed since his days, much as other communist parties of eastern and central Europe have done. Solana has indicated the EU’s acceptance of a socialist party role in a pro-Europe coalition and many members of the party see a commitment to a pro-EU government as a passport to full membership of Europe’s socialist mainstream.

I’ve no doubt there are those in Europe and the US who would dearly like to influence the outcome, but there’s probably little that can be done other than continuing to stress the benefits of integration within the European family.
 
The signing of the Stabilization and Association Agreement (SAA) with Serbia at the end of April was an important step. But presumably a new Radical-Socialist government would renounce the agreement because a majority of EU countries has recognised Kosovo. They would certainly refuse to co-operate in finding and arresting Mladic and Karadzic which itself would block implementation of the SAA.
 
To judge by the exchange of vitriol in the aftermath of the elections, we are in for a period of bitter in-fighting and uncertainty . The prospects of a rapid move towards Serbian EU accession seem to have faded considerably unless a pro-Europe coalition can be formed after all. The outcome will be a watershed in the future of the Balkans
 
It’s not only Serbians who can’t agree. It seems that NATO and the European Union are still unable to talk to one another in Kosovo, although this is quite clearly a joint operation between the two bodies. According to a recent paper from the Centre for European Reform, the Turkish government will not allow a proper relationship to develop. CER have put forward its own ideas for bringing the two organisations together, with the Anglo-French relationship at the heart of its proposals.

Alarm bells have been ringing in certain European ministries. Proposals now under discussion would bring defence-related trade under the auspices of the single market and diplomats are worried. I gather that France is calling for a legal opinion on whether European single market legislation can apply to defence-related products –  just a few weeks before the French take over the presidency; an EU intergovernmental committee on arms exports demands to be consulted on the proposals; and an argument breaks out in the European Parliament because the defence sub-committee must have its say.
 
The European Commission has been struggling for years to create a single market for  Europe’s defence-related industries. A great idea, everyone agrees. Why should the defence sector – and the taxpayer – be denied the benefits of an EU-wide defence procurement market based on a common licensing system for cross-border trade?

It should mean more competition, lower prices, quicker delivery, common standards. In other words a more efficient European defence industry and better value for money.

But defence is no ordinary sector. For decades the Commission shied away from any attempt to tackle the defence trade issue. It was a no-go area – a minefield indeed.  Member states needed only to quote Article 296 of the Treaty to claim exemption from single market rules for virtually all deals with defence and security connotations.

Much has changed. A common security and defence policy requires defence capabilities which in turn require a stronger European industry. The position of EU defence companies has weakened in relation to US competitors. The cosy relationships between defence ministries and their national suppliers have faded or vanished. And the European Court of Justice has narrowed the scope for use of Article 296.

The Commission has moved steadily in building the case, but there is evident resentment in some quarters that it should be pushing its nose into areas which have until now been governed mainly by inter-governmental agreements and foreign policy considerations. What’s more, the new legislation would further narrow the scope for governments to favour certain strategic industries. I recall President Sarkozy’s commitment to protect eleven key sectors.
 
The Council of Ministers and the European Parliament are working on two proposals submitted by the Commission last December, the first extending the principles of public procurement to defence products and the second outlining a generalised licensing system to replace the individual licences currently issued by member states for any defence-related export to another EU country. (For the current informal procurement arrangements see here).

The Commission’s proposals are being considered in the Council by the Internal Market group, but a note issued by the Council’s Working Party on Conventional Arms Exports (COARM) reveals a deep-seated concern that foreign policy considerations are being overlooked.

Take this for instance: “The export of defence products constitutes a strong political act at the heart of member states’ foreign policy. Consequently, exports of defence products to third countries must remain within the competence of member states, both in terms of export regulation and export policies”. Tough talk indeed. COARM demands that it be involved in examining the new proposals.

The current licensing system for defence sales does seem absurdly cumbersome. Governments issue individual licences by company and by transaction for sales to another EU country. According to the Commission’s impact assessment some 11,500 such licences have been requested each year since 2003. Not one has been refused.
 
But exports outside the EU are COARM’s biggest concern.  Defence goods or components might be re-exported, maybe years after they were delivered to another EU country. COARM insists that the original country of export should still be able to impose conditions on the sale and continue to exercise control long after the goods have been sold. And it is clear that foreign policy considerations will be of fundamental concern. Just consider the sensitivity of certain sales to Burma, China or various African countries.

COARM uses the Commission’s impact assessment as its reference point and maybe this is not surprising, as the Commission’s assessment is studiously cautious on the foreign policy implications of the proposals.

The French have filed specific questions to the Council’s legal service: whether single market legislation is appropriate for armaments? Whether the EU might intervene in export of weapons to third countries? And whether intergovernmental co-operation could continue once European laws were in force? (The Code of Conduct on defence exports, for instance, is an agreement between governments).

Heide Rühle, the European Parliament rapporteur in IMCO, the internal market committee, has asked for similar legal guidance, but became distinctly irritated when the parliament’s defence sub-committee SEDE also asked for legal support – none of their business, she said. Her committee chair, Arlene McCarthy, even questioned whether the French government might be interfering with the work of her committee.
 
So there are big issues at stake. There will no doubt be moves to protect some national sensitivities, but it looks as if the new legislation will go through, and is likely to have far-reaching implications for Europe’s defence sector.

According to latest reports, the likelihood of former British prime minister Tony Blair taking over as EU President in 2009 seems to be fading. The Independent newspaper reports a “secret” agreement between the big three, Brown, Sarkozy and Merkel, not to support any candidate for the job who does not have wholehearted approval of the other two.

Merkel is said to have reservations about Blair given Britain’s abstinence from the euro, from Schengen and from various Lisbon provisions. That does make sense when appointing a person who would be responsible for managing the agenda of European Councils for a renewable 2 ½  year term and with top-level global representative functions.
 
On the other hand the trio will want someone who is one of their own, so Prime Minister Juncker of Luxembourg would fit the bill, with the added bonus of coming from a small member country.

What kind of job will the EU President have anyway, given that the post relates only to the quarterly European summits and not the specialised councils? It is difficult to see the appointee as a major driver of policy – indeed the President of the Commission would be a convincing rival in many policy areas. More important will be the continuity role, avoiding the twice-yearly turmoil of transferring presidency between national leaders.
 
In practice the revamped Solana job of High Representative could be much more interesting and influential than of EU President. A seat in both Commission and Council, a budget of €10 billion, a clear mandate for international negotiations. Now that’s a job description which Blair could find extremely attractive.

The surge in world food prices, oil prices at well over $110 a barrel and measures to boost the use of biofuels in the US and Europe are putting policy-makers into crisis mode.
 
It is extraordinary how this situation has taken fire in just a few months and how intertwined the different factors are. A perfect storm, indeed. International organisations warn that the rising cost of food will threaten the stability of nations, especially developing countries. Even for a country like China food inflation is a major threat to the government.  A “silent tsunami” is how the head of the World Food Programme has described the global situation.
 
The European Commission has responded with an increase in emergency food aid, just as it should, but we are witnessing more than a short-term crisis. Commissioner Louis Michel pulled no punches when he spoke to the European Parliament recently. While announcing an increase in EU food aid spending to nearly €300m so far this year, he also warned just how dangerous the international situation was becoming.

The current food price situation focuses attention on the future of the common agricultural policy. You might think that high market prices for cereals (somewhat mitigated by the strength of the euro) would reduce the need to spend European taxpayers’ money on expensive support arrangements for EU agriculture, but that’s not how French farm minister Michel Barnier sees it.
 
For him the present situation proves the need for an expensive protectionist policy. He even urges other countries to follow suit and build their own c.a.p., so everyone would aim for autarkic self-sufficiency. His German counterpart Horst Seehofer is walking in the same direction. On the other hand this particular view was swiftly rebutted by Agriculture Commissioner Mariann Fischer Boel who took a pro-trade stance, just one month before her proposed overhaul of the CAP.
 
Of course agricultural ministers always resist change, but these interventions suggest that longer term moves to review the future of the c.a.p. will run into stiff opposition. We can probably kiss goodbye to any hope of completing the Doha Round before the US elections. Interestingly, Brazil is making tariffs on biofuels a key aspect of its position on Doha.
 
Pressure on the EU biofuels commitment continues to build. Commission President Barroso has asked for an assessment of the impact of biofuel production on food prices and on development. The Commission press room is thick with rumours of division in the college. Some officials are briefing that the 10 per cent commitment for biofuels in transport fuel by 2020 has been sidelined, while others dismiss any such talk.
 
Among member states the British appear to be reconsidering their biofuels commitment after a national 2.5 per cent obligation came into effect. Prime Minister Gordon Brown is concerned that some biofuels do not meet the necessary sustainability criteria and may call for changes in the EU targets.

The fact is that European and American subsidies for biofuels, which were designed to prime the pump until the industry could become viable in its own right, have produced a host of unpredictable and positively absurd consequences.
 
For instance, it seems that a big chunk of Europe’s biofuel industry has been put out of action because of the imports of “splash and dash” biodiesel from the US. All you need is a tanker load of biodiesel, maybe exported from the EU or South America, add 1 per cent of mineral oil, collect a subsidy of €200 per tonne from the US administration and then ship it back to Europe where you collect further subsidy. The EU companies have now lodged a formal anti-subsidy and anti-dumping complaint.
 
The debate over GMOs is going to hot up as well. It takes on a new urgency as world food prices continue to soar and is bound to provoke some intense debate in Commission, Council and in the member states. No doubt there are risks to be analysed and assessed, but I wonder how the arguments against the use of genetically modified crops could stand up in the face of a major world food crisis and massive malnutrition in developing countries.

I see that the corporate status of Volkswagen is in the spotlight again.  Last year the European Court ruled that limitations on voting rights in VW’s statutes infringed EU rules on freedom of capital movement, so the German government has now notified Brussels of proposed legislative changes to satisfy the Court judgment.

For Commissioner Charlie McCreevy these changes are not enough and letters have been exchanged.
 
It’s another of those battles where a member country wants to protect a national champion,  except that in this case the predator is also German: family-owned Porsche AG, which already holds 30.9 per cent of VW’s shares and is determined to push its holding above 50 per cent, which in most companies would mean a takeover. However, the VW law requires an 80 per cent vote in favour to adopt major decisions. That, I suppose, is the sticking point for the Commission.

The German government relinquished its own shareholding some years ago, but the Land of Lower Saxony still holds 20.3 per cent, and is thus able to block any takeover – and resist any moves to transfer the business away from Wolfsburg.
 
So what is Porsche’s interest? To bring all VW and Porsche models as it were into the same corporate garage, ensuring that VW remains German and, by the way, using the fuel-efficient Golfs to balance out the turbo-charged 911s when EU vehicle emission rules are tightened up under climate change legislation.

VW has survived attempts in the past to break up its voting structure, as when former Commissioner Frits Bolkenstein tried to push through a radical takeover directive and had to abandon his objectives in the face of widespread opposition. His successor McCreevy decided last year not to press ahead with one-share-one-vote legislation, but the VW case raises different issues of government control and the Commission is bound to pursue this one.
 
The Commission has another challenge on its plate, which is the bid by Austria’s OMV (30 per cent government owned) for Hungary’s MOL (independent quoted company). The Hungarian parliament last year adopted the so-called Lex MOL, a measure which would allow directors to block a bid for any utility company of national strategic importance.
 
This might seem a simple case of blocking capital movement within the EU, just like the VW case. Mr McCreevy is currently examining the legislation under this heading. But the closer you look, the more complex the issues become, enmeshed in the manoeuvring for control of energy markets across central and south-eastern Europe and the Balkans.

Heaven knows who is on whose side! Russia’s Gazprom was said to support OMV’s bid, and a Russian businessman bought a substantial slice of MOL stock on the Budapest stock exchange last summer which he then obligingly passed to OMV, yet OMV portrays itself as Gazprom’s competitor in the region and supporter of the Nabucco pipeline project, a gas transit route from central Asia through Turkey to Europe which would bypass Russia and offer an alternative to Gazprom’s South Stream pipeline.
 
Nabucco is a favourite project of the EU, as Commissioner Piebalgs has confirmed and is enthusiastically supported by the US, although ironically it would seem to depend on tapping Iranian gas supplies to become viable, which of course does not go down well with the Americans.
 
Needless to say, Russia is no enthusiast for Nabucco, but no doubt delighted that Hungarian prime minister Gyurcsany recently signed an agreement in Moscow supporting the South Stream pipeline – a move which cynics said was designed to boost his pension following defeat in the recent referendum in Hungary, rather in the style of a former German Chancellor who became a Gazprom executive.
 
OMV’s bid was notified to the European Commission under the Merger Regulation in January 2008. An in-depth investigation was announced in March, with a decision currently foreseen for July 22. Separating the economic from the geopolitical aspects of this case will be no easy task for the Commission’s competition team and you can be sure that colleagues from DGs for energy and external relations will have plenty to say.

It seems so different from the old days, when the Franco–German alliance was the central core of European integration. With new leaders come new perspectives. President Sarkozy used his March visit to London to woo the British, with a speech to the British Parliament where he paid unheard-of tributes to Britain’s qualities and set out a detailed agenda for Anglo-French co-operation.

The elegance of Mme Carla Sarkozy gave extra media colour to what was a highly successful state visit. If he wooed, she certainly wowed. The Entente Cordiale, signed in 1904 between Britain and France, has a new lease of life.
 
The President’s message was, to coin a phrase once much loved of some British politicians, that the UK should be at the heart of Europe, even implying that an Anglo-French partnership could be the new driver for the EU. One practical initiative is that ministers from the two countries will meet on a quarterly basis – presumably matching the bilateral sessions between Paris and Berlin. Thirteen French ministers accompanied the President to London.

Almost everything in the President’s agenda involved bilateral initiatives, but mostly set in an EU context. On the other hand there was little rhetoric from Gordon Brown which indicated any new enthusiasm for Europe.
 
Still, it’s a reflection of how EU priorities are changing, that even the most sceptical journalists were hard put to identify subjects of disagreement. Not even the common agricultural policy was much of a bone of contention (after all, we must learn to love the CAP in the face of soaring world prices!). Whether or not to boycott the Beijing Olympics opening ceremony seems about the only discordant item. No indication that energy liberalisation was discussed.
 
Especially interesting would be to know what was said behind the scenes about defence. Sarkozy has already indicated that France may wish to rejoin the integrated command structure of NATO, abandoned by De Gaulle in 1966, and will provide additional forces for Afghanistan, but nothing was said publicly about strengthening the European Security and Defence Policy and France’s wish for a stronger ESDP planning capability.
 
A stronger European identity in NATO may be France’s price for rejoining the alliance. This remains highly contentious for the US and probably for the British too.

On the other hand there was agreement on an Anglo-French maintenance contract for the A400M transport aircraft when this comes into service, leaving the Germans to their own devices, and reinforced arrangements for joint procurement and for pooling of helicopters, aircraft carriers and maritime aircraft in joint missions under EU or NATO auspices.
 
Certainly Sarkozy feels temperamentally closer to the UK than to Germany. There is no evidence of a close personal rapport with Angela Merkel of the sort which he seems to have with Gordon Brown and there have been specific problems, notably over vehicle emissions, over the independence of the ECB and over his idea for a Mediterranean Union (resolved in advance of the March EU summit – see Annex 1). Nor is Germany a natural partner on defence issues as Berlin faces politically painful challenges in putting German troops into combat zones.
     
In the end, though, the demands of realpolitik will determine alliances. The Franco-German understanding in not dead.

Talking of which, I note that Angela Merkel said that her CDU party agreed with Sarkozy’s UMP that Turkey should have a privileged partnership rather than full EU membership. This promises interesting enlargement negotiations when France takes over the EU presidency in July and certainly marks a fundamental difference with British policy. Another issue which failed to feature in the public pronouncements in London!

France and the UK both have relatively new leaders who could change Europe, but so do others. In Cyprus, for instance, there are signs of movement following the election of President Christofias, including demolishing barriers in Nicosia’s main shopping street. A symbol of hope, even though there’s a long way to go to unification.

I see that the new Polish Prime Minister Donald Tusk is threatening a referendum on the Lisbon Treaty unless President Kaczynski’s party supports ratification in Parliament. The party withdrew its support, demanding the same opt-out from the Charter of Fundamental Rights as secured by the UK.

It seems that June 12 has been set as the date for the Lisbon referendum in Ireland, the only country to hold such a vote (unless Tusk has to make good his threat). The Irish vote will not be a walkover  Sinn Fein will campaign for a no vote; Jean-Marie Le Pen has announced that he will also participate. It promises a fascinating contest where turnout will be crucial. A no vote would of course block ratification of the Treaty: back to the drawing board.

For many of Britain’s Tory MEPs June 11 2009 is a date which rushes upon them all too fast: it’s when Britain votes in the next European elections.  So where will the Conservative Party stand on Europe? Will the Conservative group in the European Parliament be forced out of the EPP and into a strange alliance with some Czech MEPs? And will Tory leader David Cameron make “renegotiation” an election pledge, assuming that by then the Lisbon Treaty will have been ratified and implemented?

MEP Caroline Jackson has decided to go public with her concerns in the Financial Times, in the hope of triggering a more thoughtful debate in her party. She warns of “a very nasty patch of poisonous fungus” among the green leaves of the party’s symbolic tree. She wants David Cameron to have the courage to admit he was wrong and to take Europe seriously.

The Conservative leader is certainly a pragmatist, working to find traction in the slippery middle ground of British politics. See Nick Robinson’s blog profile which asks just ‘What does Cameron think?’.

Cameron’s attitude to Europe seems to be among his more cynical ploys, designed to keep at bay the challenge from the UK Independence Party, to provide some red meat for the right wing of his own party yet to send a message to the British electorate that Europe is of no significance. He barely recognises the existence of the Conservative EP group and runs the risk that some MEPs will leave the party altogether and make common cause with the Lib Dems.

The big prize for Cameron would of course be victory in the British general election, which could also be in 2009 (how about June 11 2009?). It will take a landslide to give the Conservatives an overall majority and the Lib Dems could well be the king makers in a hung parliament at Westminster. They also have the chance to mount a big challenge in the European elections.
 
The open question is whether Cameron will change his strategy as elections come closer and the prospect of government becomes reality. These are indeed tense times for the pro-European MEPs in the Tory group.