Coalition's first 100 days: Foreign policy

Britain's place in the world depends on coalition dynamics
Britain's place in the world depends on coalition dynamics

From outright ignorance to devious calculation, the coalition's mixed motives have left its foreign policy open to criticism in its first 100 days. Dark undercurrents of domestic party politics might be to blame.

By Alex Stevenson

Both David Cameron and Nick Clegg recognised, very early on, the need to integrate Lib Dem ministers across the government. Influence is critical and the liberal scattering of ministers across departments dealing with international affairs was designed to help. But in foreign policy the recipe is not quite working. Lib Dem influence is virtually absent on the world stage, while on Europe and Trident it remains highly questionable. The extent to which Britain's third party succeeds in influencing the country's global stance is critical in a vital period of changing diplomatic and military stances. The stakes are high - for the country as well as the parties which seek to govern it.

A 'grand strategy' foreign policy

At its biggest scale, the most important changes introduced at the Foreign Office involve recalibrating foreign policy towards the east. Last month's very substantial trade delegation to India, coming so early on in the new government, demonstrated the seriousness with which the coalition takes the emergence of what will be the 21st century's biggest economies. Britain is more at ease with India than it is with China because of the past; it is easier to court Delhi than Beijing. But both will matter in the coming years.

The question is one of emphasis. Since the Second World War the 'special relationship' with the US has been at the heart of Britain's approach to the world. It ebbed rather than flowed under Gordon Brown; an inevitable side-effect of the eastward focus is a "relative downgrading" of the London-Washington links. "That's one of the interesting things about the Tories," Richard Whitman of international affairs thinktank Chatham Hosue says. "They haven't sought to fundamentally alter the nature of the relationship the UK has with the US. But it's a rebalancing - the US is still there."

When it comes to diplomacy presentation matters as much as substance. Perhaps David Cameron's failure to understand this was what led to his critical comments, on Indian soil, about Pakistan's double-edged relationship with the Taliban. Cameron was roundly condemned for his remarks. But Whitman detects another motive.

"I'd interpret a domestic prism," he says, arguing that the Tories view foreign policy as an area of opportunity when it comes to distinguishing their politics from the Liberal Democrats'. "It's a very compelling narrative for him and his advisers to be able to say 'I talked honestly to leaders in countries on different issues'... It makes sense in terms of differentiation at home but causes problems for them overseas." Whitman says criticising Pakistan on Indian soil demonstrated an especially pronounced "naivety".

It's still early days to judge the coalition's performance on this, the biggest of all stages. Perhaps Gordon Brown's biggest achievement while in No 10 was as a statesman, hacking out detailed agreements to save the global financial system while chairing the G20. Cameron has not yet had the opportunity to prove himself at the same level. When he does so let's hope he puts the naivety to one side, even if it means sacrificing party political gain for the good of the country.

European meekness won't last

The domestic motive would be much less painful to the Lib Dems if Conservatives within the government were not treating Europe, the most sensitive foreign affairs issue facing them, with less finesse. Continental capitals were extremely uneasy about the Tories' intentions in the months leading up to the general election - not helped by their departure from the European People's party, the main centre-right grouping in the European parliament. But the concerns have not been realised. "They feared a "virulently eurosceptic govt that was spoiling for a fight on every issue," says Philip Whyte of the Centre for European Reform. "What they have is a pragmatic government that's going to pick its fights carefully."

The signs are there for all to see. In George Osborne's first meeting of European finance ministers he avoided making a fuss about an especially contentious directive on hedge funds. David Cameron has formed good relations with both German chancellor Angela Merkel and French president Nicolas Sarkozy - something the pair have not succeeded in achieving between themselves. And the media have been treated to deputy prime minister Nick Clegg talking in fluent Spanish - a small, but not insignificant, point.

"The question," Whyte says, "is whether this is the calm before the storm".

Two ominous-looking clouds are gathering on the horizon: financial regulation and the EU budget. "The major disagreements, as always, usually boil down to an argument between the Germans and the Americans," says Jan Randolph of IHS Global Insight. "The British and the French tend to back one or the other. On the bank levy they've backed Europe."

The decision would have been much easier for the government had it not been for the City. London is the largest financial centre in Europe. So ministers face a "difficult balancing act", according to Whyte, in which they want to clamp down on banks while avoiding damaging London's competitiveness. The hedge funds directive was a case in point. Then, Osborne accepted defeat. It may not always end the same way. Whyte warns: "If the British government believes the EU is not taking account of British sensitivities then we do have the potential for big blow-ups."

The second threat is that of the EU budget, which begins a new seven-year cycle in 2013. Negotiations towards this date are already taking place - and the UK's position is becoming "increasingly unsustainable". Whyte fears reforms of the increasingly watered-down common agricultural policy are undermining Britain's arguments. But Whitman is more confident. He looks back to 2005 when Britain held the EU presidency and Tony Blair built a "coalition of the disaffected". This united all the countries holding rebates with those like Germany who felt they were overpaying. "There are a collection of natural allies for the UK on the budget issue, as long as the UK is able to handle the issue in quite a canny way."

The first 100 days have seen the coalition get off to a good start. Whitman acknowledges ministers have done a "very good job at not allowing EU policy to dog the domestic political sphere". But, with disputes set to develop in the near future, the calm may not last. And, yet again, domestic politics could play its part.

Whyte offers a final warning: "I suspect parts of the Tory party are already quite restive of the fact the coalition appears to be rather more centrist than they would actually like, requiring the government to be seen to be picking fights with its European partners." Yet there is no evidence that the Conservatives would not have been as meek on the continent as the coalition has chosen to be: only in future crises will the true balance of power within the government become apparent.

Defence dilemmas

European tensions are deferred for now. Ministerial attention is instead focused on the long-overdue strategic defence and security review (SDSR), which will report this autumn. Its remit couldn't be more broad, questioning the purpose and utility of Britain's armed forces. With the Ministry of Defence's finances out of control - an annual 'black hole' of £9 billion is undermining the £36 billion budget - the perennial inter-services debate about where to cut is raging more fiercely than ever.

Here, at least, the formalised nature of the defence review is helping focus minds. "I'd hope that the SDSR process would make for a more strategic response than a knee-jerk, politically driven one," says Andy Hull, a senior research fellow on international and security issues at the Institute for Public Policy Research. There's no doubt this is a "tough time" to be in the MoD. Cuts are inevitable, with the two new 65,000 tonne aircraft carriers and the joint strike fighters which will fly from them now looking especially endangered. At least the taking-stock, longer-term perspective is helping officials balance defence secretary Liam Fox's desire for a general "war-fighting capability" with the need to specialise.

Former Army chief General Lord Charles Guthrie has been one of the strongest anti-salami-slicing brigade. In an article jointly written with Hull, the pair echoes the arguments of current Army chief General Sir David Richards that, with allies to rely on, the best route for Britain is to be very useful in a limited number of areas, rather than mediocre at all.

"We must concentrate on what we need and what we are good at," Guthrie and Hull urge. "If we try to be good at everything, we will end up good for nothing."

If this was all the SDSR had to deal with the choices would be agonising enough. George Osborne's refusal to allow funding for the Trident nuclear deterrent to be drawn from Treasury coffers has made the situation much more acute. If the MoD pays for a like-for-like replacement it will mean drastic cuts to its conventional forces. According to some estimates over 25 years Trident could cost between £75 billion and £100 billion.

A recent report by Professor Malcolm Chalmers of the Royal United Services Institute argued Britain might want to save cash by compromising. A nuclear deterrent which was not immediately deployable could retain credibility while winning non-proliferation prestige, for example. Chalmers' report has opened the way for tensions within the coalition to emerge. This is a simmering, ongoing debate, which could easily be fudged in the SDSR. The decision on whether to order replacement submarines could be put off until 2014, according to Hull. The Lib Dems opposed the like-for-like replacement during the campaign and the coalition agreement committed to reviewing its necessity.

Yet, as Whitman points out, the Lib Dems appear somewhat marginalised in the Foreign Office. "It's really difficult, aside from Europe, to see where the Liberal Democrats have either preserved Lib Dem foreign policy within the coalition or are able to demonstrate where their fingerprints are on foreign policy," he notes. Trident offers the Lib Dems an opportunity to have a huge impact - "but the Lib Dems aren't getting much purchase". Even on Europe analysts are uncertain as to whether the coalition's tentative approach is because of the presence of Lib Dems within government, for the Tories could easily have adopted a pragmatic approach by themselves.

These hidden tensions may seem veiled, or even irrelevant, to foreign observers. Yet their importance shouldn't be underestimated. After 100 days in power the coalition's early dynamics have revealed more questions than answers about how the struggle for influence on critical issues will pan out.


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