New Alliances in Post-Brexit Europe: Does the New Hanseatic League Revive Nordic Political Cooperation?

Abstract

As Brexit removes the Nordic countries' most powerful ally from the EU, what does this imply for their approach to European affairs? The literature on small states within the EU suggests that they can counterbalance limited bargaining capacities by entering two types of alliances: strategic partnerships with bigger member states and institutionalised cooperation on a regional basis. Against this backdrop we ask whether, by significantly raising the costs of non-cooperation for Nordic governments, the Brexit referendum has triggered a revival of Nordic political cooperation. We scrutinise this conjecture by analysing Nordic strategies of coalition-building on EU financial and budgetary policy, specifically looking at attempts to reform Europe's Economic and Monetary Union and proposals to strengthen the EU’s fiscal powers. We find that Nordic governments have successfully collaborated on these issues in the context of new alliances such as the 'New Hanseatic League' or the 'Frugal Four.' Yet, their coalition-building strategies rely on relatively loose and issue-specific alliances rather than an institutionalisation of Nordic political cooperation, implying that this revival of Nordic political cooperation hardly involves the institutions of ‘official’ Nordic cooperation. We argue that this reflects lasting differences among the Nordics’ approach to the EU as well as electorates’ scepticism about supranational institution-building, implying that ‘reluctant Europeans’ are often also 'reluctant Scandinavians.'