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Tread Lightly, Mr. President

Could Macron’s tactics on workers’ pay backfire and benefit the region’s populists?

by Martin Ehl 31 August 2017

During a meeting with French President Emmanuel Macron earlier this month, Austrian chancellor Christian Kern voiced his support for the former's proposal for a reform of EU labor market rules. Also present were Czech and Slovak Prime Ministers Bohuslav Sobotka and Robert Fico, and they, too, gave their stamp of approval. Details should emerge soon, and the deal should be in place by October. Macron had made the issue of “social dumping” – lower salaries for people from newer EU countries who are “posted,” or hired to work, in older, Western ones – one of the key topics of his successful electoral campaign.

 

The Central European leaders from the Czech Republic and Slovakia meanwhile have struggled to persuade voters that to be an EU member is worth the effort. Recent polls from the Visegrad Four countries – the Czech Republic, Slovakia, Poland, and Hungary – have shown that the Czechs are the most Eurosceptic. Fico, whose country is the only one of the V4 members to also be a member of the eurozone, has stressed that being in the core of the EU is vital to Slovak interests. While the Slovak prime minister’s government continues to face various corruption allegations at home, his enthusiasm has made him Brussels’ favorite in Central Europe.

 

As the meeting with Macron in Austria also made clear, there are growing regional differences. While Czechs will go to the polls in two months, which could result in quite a Eurosceptical government, the Poles and Hungarians are considered to be already on the brink of leaving the club – at least theoretically. Their nationalist and populist governments are more and more at odds not only with Brussels but also with the most important players in other capitals. Macron, who has big European ambitions, skipped the two countries during his recent tour of Central and Southeastern Europe, instead departing Austria for Romania and Bulgaria. Poland, though the sixth biggest EU country, is likely to have less of a say at EU summits from now on.

 

Well, the issue of posted workers shows how divided EU members still are, and how painfully and slowly the catch-up process has been moving. This is connected with the level of the salaries paid by Western investors in Eastern member states, a related hot topic these days. For example, before meeting Macron, Sobotka said that he would push the French president to ask French investors to raise their salaries in the Czech Republic. Sobotka has already done this successfully in the case of the Dutch retail company Ahold, and Slovak VW workers have done the same, so why not try again?

 

The issue of posted workers is two-sided, as Macron has probably realized by now. The argument of Czech trade unions is that French companies (as well as Austrian, since the meeting was in Salzburg) use social dumping to the East in the form of low salaries for their employees there. This is a crack in European solidarity visible from both sides, and Macron was already involved in this debate since, as French minister of the economy, he pushed for paying the minimum French salary to Central European cargo drivers passing through France.

 

Macron is and will be tough on this topic – he needs to show that he is capable of European-level leadership, and this seems to be the most popular topic for his French voters.  Eastern members are too divided (note the Polish-Hungarian tandem, separate from the Czechs and Slovaks in the V4) to create a strong opposition.

 

As the Slovak prime minister has shown through his openness to French arguments, there are Eastern politicians willing to compromise with their Western counterparts on such issues. But Western partners are too often not aware that issues like posted workers are among the few that make the EU acceptable in the eyes of average voters (who would still like to earn a buck to the West, even for lower pay). Pushing too hard for the change of the posted workers directive might help populists and nationalists in Central Europe, and increase the popularity of Eurosceptics.

 

And this is the last thing those few Czech politicians who are brave enough to campaign openly during the electoral season for deeper EU integration need.

 

We have the experience of such nuances somehow hidden to Western partners, who too frequently ignore what is going on in the Eastern part of the union – and then are surprised by the strong support of nationalist and populist leaders like those now in power in Poland and Hungary.

Martin Ehl 
is the foreign editor of the Czech daily Hospodarske noviny. He tweets at @MartinCZV4EU.
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