Foreign Policy Decision Making in Finland: A Constitution and the EU Case

Professor Alpo Rusi
Political Processes: Challenges and Opportunities
20th of April, 2018, 4th Annual Conference
11.00-13:00, in VMU, Kaunas, Small Hall

My paper is based on my own experiences as an advisor to the president of Finland from March 1994 to October 1999 as well as on studies and biographies about the subject. While serving as a foreign policy advisor, the EU was top of the agenda in Finnish politics. An advisory referendum on joining the European Union was held in Finland on 16 October 1994. 56.9% of voters approved of the proposal, with a voter turnout of 70.8%. Due to having its own customs jurisdiction, a separate referendum was held in the Åland Islands a month later, and was also approved.

The EU membership and already the application process started changing the decision making of foreign policy. The Prime Minister strengthened its role and powers and the President had to give up some of his powers already before the Constitution was adjusted to the EU needs. In France, that is comparable with Finland, President’s position was not changed because of the EU and not due to ”cohabitation” either. For domestic political and personal reasons Finland did not follow the French line.

I will focus on foreign policy decision making and analyse the constitutional problems emerged resulting from the EU membership. My presentation consist of three parts:

1. Finland’s Constitution from the point of view of foreign policy decision making since independence 1917.
2. Finland’s joining of the EU 1995 from the point of view of foreign policy decision making.
3. Foreign policy decision making based on the new Constitution of 2000.


A Historic Overview

Finland’s Constitution is based on a parliamentarian republic and it was approved two years after the declaration of independence in July 1919. Power was shared between the parliament, the government and the President. In the field of foreign policy, the Constitution granted the decision making power to the President.

However, President did not have his own administration. Consequently, the government and especially foreign minister and the foreign ministry played an important role in any foreign policy decision making processes. A normal practice was until the outbreak of the Winter War 1939 that the foreign ministry under the leadership of foreign minister prepared the decisions after which the minister presented the proposal for the final decision to the president. Very seldom there ensued any conflict between the government and the President. However, in March 1922 Foreign Minister Rudolf Holsti was sacked by the parliament that did not accept the treaty he had signed in Warsaw concerning the Baltic Sea cooperation. This was an exception in the rule.

The role of the President changed during the crisis years of war between 1939 and 1944 because Marshall Mannerheim was a commander of the armed forces. We had a dualistic leadership system in foreign policy. During the Cold War Finland’s Presidents were using actively their full powers. The reason was our difficult geopolitical situation but also domestic instabilities because the Communist Party wanted Finland to follow the ”Prague’s example”, as Hertta Kuusinen, a leading Communist politician declared in 1948. The threat to be occupied by the Red Army was not an impossible alternative. Especially during the long presidency of Urho Kekkonen from 1956 to 1982, which contains a number of constitutional and other problems despite successes, the governments were more or less ”President’s cabinets”. Kekkonen was doctor of law and a member of the parliament since 1936. He was a good macchiavellian with respect to his methods.

Following Richard Neustadt’s studies dealing with the Presidential powers in the United States, Kekkonen was a smart bargainer combined with reputation and prestige. One could compare him with Franklin D. Roosevelt. His successor Mauno Koivisto was doctor of sociology, social democrat and a war veteran. Koivisto was never a member of the Parliament but Prime minister twice and Governor of the Bank of Finland. He was a technocrat with political merits. One could compare him with Dwight Eisenhower who had reputation and prestige but was not necessary a bargainer either in foreign or domestic politics. Kekkonen used his bargaining skills in particular with the Soviet leaders, but Koivisto preferred status quo to satisfy the Soviet pressure. Both Presidents were ”friends” of the Soviet union and tried to convince Finland’s loyalty. In domestic politics, however, Koivisto used efficiently his bargaining skills based on the traditional presidential powers . [1]


From the Soviet Sphere of Interest to Western Integration

In order to to understand the dramatic changes that followed Finland’s relationship with the EU, a brief look at the history of the Finnish membership is necessary. During the Cold War there existed a consensus that for geopolitical reasons it was not wise to join the political Western bloc and its institutions in case these steps would harm our relations with the Soviet union. For political reasons Finland did not participate in the Marshall Plan. [2]

In April 1948, the Treaty of Friendship, Cooperation and Mutual Assistance between Finland and the Soviet Union was signed and it set up the framework for the Finnish relations to the Soviet Union and sometimes even beyond that for about 40 years. So it was no surprise that Finland was not among the founding members of the Council of Europe in May 1949. Actually, Finland did not join the Council of Europe before 1989.

However, the Finnish governments tried to use all opportunities to safeguard the access to foreign (Western) markets for its export industry based mainly on pulp and paper. Before the relations between the superpowers deteriorated further, Finland used the window of opportunity in 1947 and early 1948 to join both the International Monetary Fund, the World Bank and the General Agreement on Tariffs and Trade (GATT). Even Sweden joined the IMF more than three years later than Finland.

Finland’s key economic partners Sweden and UK did not join the original EC founded by the Treaty of Rome in 1957 but with some other countries founded EFTA in 1960. Finland negotiated the so-called Fin-EFTA agreement, which made us an associate member of EFTA in 1961 and gave us access to the markets of the area. As a political condition, Finland gave the same trade concessions also to the Soviet Union.

However, Finland took prudent steps towards the west, and in 1968 we became a member of the OECD, the successor to OEEC, that had been established for the delivery of Marshall Aid. We also participated in the Nordek negotiations of 1968-70 aiming for a customs union or an economic community between the Nordic countries. These negotiations did not lead to an agreement.

In 1973, the UK joined the EEC together with Ireland and Denmark. For Finland, this was the first Brexit, then from EFTA, as governor of the Bank of Finland, Erkki Liikanen stated in his speech in London last October. [3] In Finland the leftist parties opposed the Finnish free trade agreement with the EEC. The leak in October 1972 in the Finnish and Swedish newspapers about the secret negotiations between President Kekkonen and the Soviet leaders in August same year was aimed at sabotaging the agreement that was opposed by the Soviet union. In 1993 Erkki Tuomioja revealed that he as a young mender of the Parliament had conveyed the essentials from the top secret memorandum to the media. [4]

The next big challenge for Finland and the other EFTA members was how to guarantee access to the Single market established in 1989. The negotiations led to the creation of the European Economic Area (EEA). The EEA included all four freedoms: the free movement of goods, services, capital and labour, plus participation in a Cohesion Fund. At the time when the project was started, it was supposed that EFTA and the EEC would remain separate organizations. But the world and Europe changed. The unification of Germany in 1990 and the dissolution of the Soviet Union in 1991 changed everything.


Towards the EU after the Collapse of the Soviet Union

The EEA agreement was signed on in May 1992 but by that time, Finland had already applied for EU membership. I was personally involved in the preparations of the application as a member of the Governmental working group to scrutinise the pros and cons of the membership in the autumn 1991. Later on it was my task to draft the security policy sections of the acquis of Finland with the commission staff, especially with Fraser Cameron of the UK. The EEA agreement entered into force in January in 1994. This was the solution for Finland for one year only.

Why did Finland apply for EU membership so soon? President Mauno Koivisto explained this well in his speech in Parliament: We want to have a seat at the table where the decisions are made. We needed the European Economic Area, but we also wanted to have influence. We wanted both access and a say. This was politically possible because the Soviet union had collapsed. Koivisto did not mention this because he had been against the membership until the end of the year 1991.Perhaps he started changing his view after the failed coup in Moscow August 1991.


The root causes of the Constitutional Crisis in the 1990's

President Koivisto was replaced with Martti Ahtisaari (social democrat), a UN diplomat, on March 1st, 1994. This triggered off the constitutional problems concerning the powers of the president. The reason was first of all the membership in the EU that entered into force on January 1st, 1995. It was believed that President should not be anymore the key player in foreign policy as before. Prime Minister Paavo Lipponen (social democrat) whose party won the parliamentary elections in March 1995 was a convinced federalist. In his view, to compensate for its geographic distance from the continent, Finland should be in the institutional core of the EU.

Ahtisaari was elected based on the Constitution which was slightly changed in the 1980s to strengthen the role of the parliament. The President was also chosen for the first time by a direct popular vote in 1994. The old political elite was bypassed by the two candidates who reached the second round in January 1994. Ahtisaari had won the pre-election vote of the Social democratic party in May 1993 because the voting was opened to all citizens eligible otherwise to vote. The candidate of the forthcoming Party Chairman Lipponen was former Prime Minister Kalevi Sorsa who lost bitterly to Ahtisaari. This loss was a political problem for the Social Democratic party and Ahtisaari. Sorsa criticised the pre-election vote as a shame to the reputation of the party.

Sorsa was not popular in his own party rank and file but trusted in the party elite he had promoted and picked since 1969 when he was chosen by the former party chairman to party secretary without permission of the party conference to vote as had been the normal procedure. The party chairman Rafael Paasio wanted his party to be trusted in Moscow and Sorsa seemed to become his asset in this respect for the reason not yet fully revealed. [5] This may have had an additional impact on the constitutional crisis later on in the 1990s. [6] The Moscow card did not disappear from Finnish politics as a result of the collapse of the Soviet union.


The Foreign Policy Decision Making in Perspective

The controversy began already in the connection of the Korfu summit of the EU in June 1994. Finland was about to sign the membership treaty and the issue was symbolically who will have the plate during the dinner of the leaders. It was believed that only one plate per delegation was possible. Based on the Constitution President was number one and eligible to have his plate handedover to Finland. Prime Minister Esko Aho (Center party) was in disagreement and demanded for him the plate. I personally tried to facilitate the crisis but failed. This controversy in Korfu created a more or less permanent crisis concerning the official participation to the EU Summits. As a compromise it was agreed that besides Prime Minister, also President is eligible to participate when ever foreign policy issues are on the agenda of the summit.

The Korfu confusion triggered off a conflict between the President and the political elite. The Chairman of the Conservative party Ville Itälä later on demanded the elimination of the President institution as whole, which of course is not anymore the position of that party because Finland has President from the Conservative party since 2012, Sauli Niinistö. According to Neustadt’s analysis, Ahtisaari represented ”rethorical presidency” that has been a common feature in the Western democracies as a result of the media power and internet today. Old political border lines are not anymore decisive when the voters select their candidates. No surprise, that the political elite accused Ahtisaari for the ”americanising” of Finnish Presidency. The accusation contained a foreign policy message too.

The political parties negotiated over the head of the president changes to the Constitution and reduced a
number of powers of the President basically related to domestic politics but having an impact on foreign policy decision making too. The new Constitution replaced the 1919 Constitution and entered into force on March 1, 2000. The same day Ahtisaari’s successor, former foreign minister Tarja Halonen (social democrat) began her first term. In case Ahtisaari would have fought for his second term, he could have either launch an independent election movement or otherwise confirm his position. Ahtisaari’s popularity surged after the Kosovo peace process in June 1999, but the social democrats had chosen Halonen to be party’s candidate in May. It reminds of Winston Churchill’s situation in 1945. Job well done, but goodbye.

The main reason for Ahtisaari’s fall as President was related to foreign policy. Lipponen represented the view that the EU should develop a special partnership with Russia. The Social Democrats, the Leftist union and the Center party criticised him for the lack of interest to develop relations with Russia. Halonen bypassed President by criticising the Baltic states for the interest to apply for Nato membership. Later on, as President she even publicly criticised in der Spiegel in January 2001 the Baltic states by arguing that their Nato policy has weakened stability in the Baltic Sea region. Ahtisaari for his part had never spoken against Nato membership of any country. He proposed in Tartu university in May 1994 the establishment of the Northern dimension to the EU in order to promote the aspirations of the Baltic states to join EU in the future. Lipponen initiated the proposal in September 1997 but primarily connected Russia to the EU fundings instead. Prime Minister did not consult President before his action.

The problems in foreign policy decision making were self-evident during the Ahtisaari presidency. Lipponen was furious in case President or anybody from his cabinet would have been involved in the EU issues. Even a technical phone call from the office of the Prime Minister of Netherlands to a member of President’s cabinet before the Amsterdam Summit in 1997 was a reason for Lipponen to accuse President’s cabinet member for breaking the Constitution. He himself was close to be impeached in January 2000 when he without consulting President accepted the punishment of Austria in the EU consultations. He was rescued by Ahtisaari who informed the government later on that he approved Lipponen’s decision. [7]

In the summer 1999 there was a major controversy inside the Lipponen government related to the Sarajevo summit. Finland took over the EU presidency on July 1st and had to organise the Summit in Sarajevo to launch the Stability Pact for South-Eastern Balkans. As EU Coordinator I had to negotiate both the funds and the political agenda for the Summit. President Ahtisaari was chairman of the Summit on July 29 to 30 but which was reluctantly approved by Lipponen and his government.

My view is that the issue was the controversy with respect to the role of the Finnish president in the EU-led process not the financing of the conference as Lipponen insisted. Finland’s financial share was not bigger than others. Despite controversies caused by the EU membership, President chaired the Foreign and Security Policy Committee of the government in connection of which all important decisions were taken. This is based on the new Constitution which articulates that

”President leads foreign policy in cooperation with the government.”

Consequently, this decision making system is working today. President has also nominated more advisors to his cabinet and can still control for example the nominations of the ambassadors. After the Lisbon Treaty of 2009, the President does not anymore participate in the summits of the EU which was a cause of controversy between President Halonen and Prime Minister Matti Vanhanen (Center party). Halonen insisted that she would have had a special role with respect to the relations with Russia. This comment is interesting but beyond my task of today.

President is primus inter pares in security policy. In case he would decide that Finland has to join Nato, most people would accept his decision. However, President Niinistö is careful leader without background in security but domestic issues. He has gradually become more active during his second term he managed to achieve already by first round last January. The challenge of Russia is more demanding since the end of the Cold War.

However, President has the privilege to meet leaders of the great powers alone without members of the government as quite recently happened with Donald Trump and Vladimir Putin. In the meeting with President Donald Trump at the White House, President Sauli Niinistö had an entourage consisting of his young advisor and and experienced career diplomat as chef de cabinet as well as our Washington ambassador. On the other side of the table besides Trump, there were Vice President Mike Pence, foreign minister Rex Tillerson and national security advisors. Perhaps our system of foreign policy decision making may still need minor adjustments. At the moment that system contains a certain amount of dualism. This is also a result of the weakened role of the Prime Minister as foreign policy player, but could change in the future.

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[1] Richard Neustadt E, Presidential Power: The Politics of Leadership from FDR to Carter, Macmillan, New York, 1980. I have dealt with the decision of the Finnish government to stay outside Marshall Plan.
[2] Finland’s foreign policy during the Cold War under the shadow of the Iron Curtain in my Vasemmalta ohi (Bypassing from the Left), Gummerus, Jyväskylä, 2007, 400 pages.
[3] https://www.suomenpankki.fi/fi/media-ja-julkaisut/puheet-ja-haastattelut/2017/governor-erkki-3liikanen-finland-uk-and-the-european-union.-london-27-october-2017/
[4] The leaks known as the Zavidovo leak, has been dealt throughly in Alpo Rusi and Jarmo Korhonen: Kremlin jalanjäljet (The Footsteps of the Kremlin), Docendo, Jyväskylä, 2017
[5] Sorsa had a problem with his close connects with the Soviet Communist party and this was revealed in 1993 based on the Bukovsky and Mitrohin archives. This issue has caused a lot of controversy in Finland. I have dealt with Sorsa’s relationship with The Soviet union in my book Yhdessä vai Erikseen (Together or Separately), Docendo, Jyväskylä, 2016. This conflict between Lipponen and Ahtisaari has been dealt with in my Mariankadun puolelta (From the side of the Maria’s Street),Otava, Helsinki, 2000.
[6] The role of Sorsa became better understood many years after his death 2004 as Lipponen revealed that he supported Sorsa, not Ahtisaari in 1993 pre-election. Lipponen had asked Ahtisaari to withdraw from the pre-elections in March 1993 for the reasons he did not indicate but was revealed by Erkki Tuomioja, a veteran politician and former foreign minister in his published diaries in 2014.
[7] As former President Ahtisaari was a member of the group of the ”Wise Men” that negotiated the dismantling of the EU boycott of Austria. One can ponder whether Ahtisaari’s own honest view was not to accept the punishment of Austria but for party loyalty accepted Lipponen’s decision afterwards.