Mururoa shadows the mark

France's new nationalism may be splitting the atoms of a federal Europe, writes David Marsh
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The Independent Online
Jacques Chirac's stand backing military action in Bosnia, high in profile and in hauteur, represents just one of the ways that the new president has sought to stamp the imperious mark of Gaullism on France's international policies. By postponing implementation of the Schengen agreement to scrap European Union border controls, and announcing the resumption of nuclear tests at Mururoa atoll, Chirac has served notice that the tricolor is back in fashion.

France's renewed emphasis on national sovereignty promises far-reaching repercussions for French links with Germany and the future of the EU. In his blustering debut on the European stage, Chirac has underestimated - or chosen to ignore - the effect of his style of government on relations with close allies such as Germany and Spain: the view from Madrid and Bonn is that Chirac's impulsive manner has unsettled France's partners. After waiting two decades to gain France's highest political office, the President gives the impression of being in such a hurry to wield power that he overlooks the pitfalls of applying it unwisely.

Chirac's huffing and puffing smacks of a certain brave desperation. At least in part, his rearguard action is designed to bolster France's international standing after the upsets caused by the end of the Cold War and German reunification. Remarkably, Chirac's efforts to bale out the leaking vessel of national independence went barely noticed in Britain during the Conservative leadership battle: an event which, in the ranking list of factors influencing Europe's destiny, appears by comparison a tawdry side-show. In reality, the shifts in the political landscape in France should both comfort Tory Euro-sceptics and, simultaneously, take the wind - or at least some of the more histrionic flailing - out of their sails. As a result of the new mood in Paris, the "federalised" Franco-German-run Europe that Euro- sceptics obsessively love to loathe now seems a lot less likely.

One of the chief sources of inspiration for the centrepiece of the Maastricht treaty - economic and monetary union (EMU) by 1999 - is France's long- standing wish to dismantle the mark by subsuming it into a single European currency. However, by showing a mailed fist in the South Pacific, Chirac has weakened his hand in Frankfurt. When Germany's main European partner opts to flaunt its sovereignty over nuclear defence, the Germans cannot be blamed for growing more reluctant to relinquish their own in the field of money.

French policy-makers, who for 10 years have sought to whittle away Germany's control of its currency, should know by now that the Germans' force de dissuasion is called the mark. Germany's resolve not to give it away lightly is founded on the belief that a strong currency provides the supreme deterrence against an evil more potent than armies: inflation. The Bundesbank's current refusal to lower interest rates further, in spite of the desire in Paris for support for the Bank of France's cautious credit easing, is one more reminder of Germany's strategy of making EMU entry barriers as high and wide as possible. And the call last week from Alain Madelin, France's economy minister, for French interest rates to be two percentage points lower illustrates the potential for explosive disagreement in Paris on the conduct of monetary policy.

Whatever the German wish for partnership with France, strong anti-nuclear opposition in Germany makes it hardly surprising that Chancellor Helmut Kohl and other senior government politicians have shown disquiet over the atomic tests. France's misjudgement of reaction in Germany shows similarities to the Shell oil company's underestimation of the German environmentalist lobby over the planned dumping at sea of the Brent Spar oil platform. French politicians who say testing will help Europe to deter nuclear adventurism by such states as Libya or Iraq fail to recognise the emotional hold of the nuclear issue in Germany. Writers in the conservative Le Figaro, who draw parallels between the planned resumption of tests and France's help in securing deployment of nuclear missiles in Germany in the early Eighties, do not realise that the world has moved on. The disappearance of the threat of a mass attack from Nato's former adversaries in the east has made the Germans still more hostile to the military use of the atom. And the West's collective failure in Bosnia (in which a contributory role was played by Germany's misguided drive to recognise Croatia in 1991) has gravely weakened the belief of the German public in a functioning European defence policy.

In the bargaining over the future of the EU, due to resume in next year's Maastricht follow-up conference, Chirac's "France first" policies make even more improbable an agreement between France and Germany on some form of European political union. This has an impact on EMU because Germany has repeatedly said that a single currency will not be feasible without progress towards political union. The top-level understanding in Bonn is that without an accord on this matter next year, the German parliament will not vote in favour of EMU when called on to do so in 1998. Partly because of disagreement in Germany itself on whether political union is desirable, the Germans take care never completely to define what this objective should look like. However, important preconditions for political union are greater EU powers in foreign policy and defence, as well as over immigration and police affairs. Without a radical shift in thinking in Paris, any advance next year towards more "supranational" decision- making on these fronts can be ruled out. Furthermore, France's enthusiasm for another German demand - more muscle for the European Parliament - is likely to have cooled further after Chirac's rough reception earlier this month from Strasbourg deputies protesting about the atomic tests.

In the debate over the mark, Chirac's nuclear manoeuvrings will cause further frowns in the bars and shopping malls of Germany. Last month in Paris, in a speech at the headquarters of the French Banking Association, Hans Tietmeyer, the Bundesbank president, looked almost beatific when he pointed out how opinion polls showed 70 per cent of Germans opposed a single European currency. More than a little cynically, considering the Bundesbank's abiding scepticism about this target, Tietmeyer called for a political campaign in Germany to improve acceptance of EMU.

Chirac's nuclear fuite en avant makes selling the single currency to the German electorate a still more uphill struggle. The message is clear: playing tough in Mururoa puts the mark further from France's grip. It would be a rich paradox if Chirac's attempt to reinvent France's credentials as a Grande Nation hastened its progressive marginalisation on the strategic map of Europe.

The writer is Director of European Strategy at Robert Fleming, the London- based investment bank.