The European Union (EU) celebrated its 50th anniversary this year. Through half a century's volatilities, it has enlarged to 27 countries, and expanded gradually from Western Europe to Central and Eastern Europe.

 

Today's EU has a total population of 480 million, and a combined GNP exceeding 10 trillion euros ($14.7 trillion).

 

The EU has traveled a path that has never been smooth sailing. Today, it is at a new crossroads.

 

It needs to set out a blueprint that is both realistic and forward-looking to get out of the stalemate and regain vigor and vitality.

 

At the 50th anniversary celebrations, leaders of the 27 EU members issued the joint Berlin Declaration, promising to break the constitutional deadlock by 2009 and be "united in our aim of placing the EU on a renewed common basis".

 

At the summit held in June, leaders of the EU member countries endorsed the roadmap proposed by Germany after lengthy negotiations and reached agreement on the draft of a new treaty to replace the European Constitution.

 

The draft kept such important measures in the European Constitution as improving the EU's decision-making mechanism and strengthening foreign policy coordination.

 

The qualified majority voting rules will be used in the Council of the European Union, which means new legislation will have to be passed if it gets a 55 percent vote of all member countries and a 65 percent majority of EU citizens.

 

To coordinate EU external relations, the posts of "European Commissioner for External Relations and European Neighborhood Policy" and "High Representative of the Union for Foreign Affairs and Security Policy" will be merged into a "High Representative of the Union for Foreign Affairs and Security Policy".

 

To reform the organizational structure, the new treaty has abolished the existing system of rotating the presidency and has appointed a permanent president.

 

However, the new treaty has dropped state-like features such as the EU flag and anthem, and the name European Constitution will not be used anymore.

 

The EU was able to overcome this crisis mainly because it decided to move with the times.

 

The world's forces are now undergoing profound changes. With China, India and other major developing countries rising, the focus of the world is gradually shifting toward Asia. Based on energy advantages, Russia's reinvigoration is also gaining momentum.

 

The EU has realized that only when it becomes stronger and more effective and seeks strength through unity, can its members better uphold their own interests in a world that is becoming increasingly multi-polarized.

 

To this aim, the EU accelerated its transformation and took two major steps since the constitutional crisis broke out in 2005.

 

The first step was to build a knowledge and service-oriented economy. The EU lags far behind the United States in terms of productivity and per capita GDP.

 

To narrow this gap, the EU increased input in education and R&D activities to upgrade its industries, and reformed its labor market and public finance to increase employment.

 

The EU economy has begun to recover since last year.

 

According to a report by the Commission, the EU economy will continue to grow this year, with a predicted growth rate of 2.9 percent and 2.7 percent next year, both exceeding previous forecasts.

 

The EU unemployment rate is expected to go down from 8.75 percent in 2005 to 7 percent next year.

 

The second step was to seek a bigger role in the international arena and become a global strategic partner. EU-US relations are improving following frictions over the Iraq War.

 

The EU has worked not only to increase collaboration with the US in the political, economic and trade sectors, but also to enhance coordination with the US within NATO and the G8.

 

During the EU-US summit held in Washington in April, the two sides signed the Framework for Advancing Transatlantic Economic Integration to significantly reduce trade barriers, and identified intellectual property rights, trade security, finance, and investment as key areas for coordination.

 

The EU also attaches importance to its relations with Russia, which is not only a significant part of the strategic balance in the European continent, but also an important energy supplier of the EU.

 

In addition, the EU has continuously increased its share of international assistance, mediated actively in resolving the Iranian nuclear issue and Palestinian-Israeli conflict.

 

It is also taking the lead in responding to climate change and other global issues.

 

The EU's improved internal structure and external image have significantly changed the perspective of its citizens.

 

According to a public opinion poll conducted before the summit, EU supporters now outnumber those who oppose it.

 

However, the road ahead is still not smooth and it is faced with many formidable challenges both internally and externally.

 

First, it will take time to adapt to its enlargement. Although the EU has 27 countries, there is a huge gap in development levels between the new and old members, and it will take at least 20 to 30 years for the newly acceded Central and Eastern European countries to reach the EU's average level of development.

 

This development gap will obstruct the EU's integration for sometime.

 

Second, the psychological barrier between the new and the old camps will not be removed within a short time.

 

On the one hand, the newly acceded Central and Eastern European countries hope to return to Europe to seek economic benefits and enhance their international status as EU members.

 

On the other, they are all afraid of becoming second-class citizens in the EU and are wary of such old European countries as Germany and France. The friction between Germany and Poland on the issue of history earlier this year is a good example.

 

Third, the EU leadership remains to be strengthened. The Franco-German axis has played a major role in promoting EU integration. However, with EU enlargement, France and Germany are increasingly finding themselves unable to lead the EU's future development.

 

The United Kingdom, though a big power in the EU, has stayed away from the Euro zone, and remains suspicious toward further EU integration.

 

It remains to be seen whether, in future, German Chancellor Angela Merkel and French President Nicolas Sarkozy can work with the new British Prime Minister Gordon Brown and form a new engine for EU development.

 

Fourth, the US plan to deploy an anti-missile system in Europe has also put the EU in a dilemma. The EU does not wish to see Russia concerned, nor does it want to offend the US to spoil the hard-won transatlantic unity.

 

The EU has to carefully walk a tightrope and seek a delicate balance between a strong neighbor - Russia and its close ally-the US.

 

Worsening US-Russia relations and Russia's announcement to suspend the implementation of the Treaty on Conventional Armed Forces in Europe will leave the EU more thorny diplomatic issues to face in future.

 

According to ancient Chinese philosophers, one should be well-established in life at 30, should not be perplexed by the complexities of the world at 40, and should know one's mandate at 50.

 

The EU, now 50 years old, is at an age to know its mandate. Despite challenges ahead, the EU will not falter going forward.

 

As Italian Prime Minister Romano Prodi put it, the EU must make a choice in the face of the difficulties and challenges: either build a strong and powerful Europe to influence the world, or become insignificant and have only itself to blame.

 

The author is deputy researcher of the Chinese People's Institute of Foreign Affairs The article first appeared on Foreign Affairs Journal

 

(China Daily December 13, 2007)