First Nordic presidency faces tough EU challenge

Asked about his greatest challenges as a politician, Harold Macmillan is supposed to have responded: "Events, dear boy. Events."

As the Germans this week pass the baton of the European presidency to the Finns, their Prime Minister, Mr Paavo Lipponen, may well curse the events upon events which will make his task so unlike that which Helsinki has been preparing for with such diligence for years.

As if the combination of the Kosovo war and the enforced resignation of the Commission were not enough, their knock-on effects have transformed an already heavy agenda - the need to pay for reconstruction is reopening the barely closed budget discussions of Agenda 2000, and the need for stabilisation, accelerating the enlargement imperative and demands for the creation of a European security capability.

And all at a time when the Commission, the policy engine of the EU, has been neutered and its replacement must embark on a massive programme of internal reform. Generating momentum and steering the EU through such troubled waters is no mean challenge for the first Nordic presidency.

Like any other presidency, Finland's ability to shape that agenda to its own priorities is very limited. But presidencies have a distinctive tone and flavour. Mr Lipponen defined that in terms of transparency with a special dose of environmental and information technology policies and in the phrase of a former president, Mr Urho Kekkonen, who saw Finland's role in the world as unlike that of the great powers, "not a judge, but a doctor".

That new style was already evident here on Thursday in the blunt warning shot fired here by Mr Lipponen, at the tendency of the larger states to regard the EU's major appointments as their private property. He warned strongly against the formation of a "directorate", or inner caucus, by the big countries and for an inclusive approach to decision-making.

Work in hand in preparing for key decisions is considerable. The Helsinki summit in December is expected to agree on a major package of tax co-ordination measures arising from a report due in November on some 200 EU-wide potentially harmful tax regimes. Progress on a joint approach to the taxation of savings is also expected.

And the summit will revise the employment guidelines for 2000, issuing recommendations to each of the member-states.

With the opening in January of another round of world trade talks, the Finns will also have to broker agreement on an EU negotiating position, no mean task given the postponement of significant parts of the Agenda 2000 farm reform package.

Bringing the first truly northern voice to EU matters, Finland's hope is that the summit will take the decision to embark on a new round of enlargement.

Accession talks with the Czech Republic, Cyprus, Estonia, Hungary, Poland and Slovenia have been under way for just over a year, and the Finns will be keen to see the next round involve the remaining Baltic republics, Latvia and Lithuania, as well as Bulgaria, Romania, Slovakia and probably Malta. And, as the frustrated Germans showed, considerable diplomatic skills will be needed to circumvent continued opposition by Greece to the involvement of Turkey in that process.

A stability conference for the Balkans as well as several donor conferences for the region are planned.

The Finns, with their special historical relationship with Russia, will also want to see EU progress there. In practical and immediate terms, it will be pushing for the EU to invest in a gas pipeline from Russia to the west via Finland, a Helsinki-St Petersburg-Moscow motorway and upgraded roads from Moscow to Berlin and Paris.

Work will have to be done to prepare agreement on the scope of next year's Intergovernmental Conference on institutional issues like the weighting of votes inside the Council.

And the Finns are strongly pushing the idea of a major summit "millennium declaration" on the direction the EU will take in the next few years.

A summit in October will attempt to work towards common approaches to asylum and immigration policies.

To underline Finland's special position, both geographically and historically, they are also planning a spectacular finale to the last EU presidency of the century by inviting the presidents of Russia and the US to join their 15 European colleagues for their first-ever tripartite summit in Helsinki.