The EU missed its chance to branch out

Journalist Ferdinando Giugliano's views regarding the outcome of the EU decision to move the EBA and EMA out of the UK.

(Bloomberg) The European Banking Authority and the European Medicines Agency will leave London and relocate, respectively, to Paris and Amsterdam. There was the usual ferocious lobbying, but ultimately the choice was open and transparent; it just wasn't particularly clever. The EU could have been more strategic about its future.

The French and Dutch cities were picked out of a hat after being tied with Dublin and Milan at the end of three voting rounds. Drawing lots to assign two important EU agencies may look a bit silly. Indeed, some newspapers in Italy are already crying foul. Yet, until yesterday there was no particular outcry about luck playing a role in the process. Complaining now sounds like sour grapes.

Still, EU governments missed an opportunity to use the process to branch out beyond the usual suspects. Britain's decision to leave the EU and hence surrender the two agencies gave the bloc an unexpected "carrot" to hand to two of its member states. This is a rarity for Brussels, which is typically associated with "sticks," such as demands for fiscal restraint of structural reform. For once, the EU could be seen as a giver rather than a taker.

Dublin and Milan would have been, in many ways, the smart choices for the bank regulator and medicines authority respectively. The two cities are located in countries that were at the centre of the eurozone crisis, but have been able to bounce back. Dublin is spearheading the Irish recovery, thanks to its openness as a financial and business centre. Milan has built on its strength as a capital of fashion, food and architecture to become one of the most exciting cities in Europe. Member states could have picked them to show to other countries in difficulty that success comes with a prize -- not just at a price.

There were other ways in which the EU could have been forward-looking. For example, it could have picked a capital from Eastern Europe, which at the moment is under-represented when it comes to hosting EU agencies. Bratislava, the Slovak capital, was a front-runner in the race to host the EMA -- which is not a regulatory authority but evaluates and supervises medicines for veterinary and human use -- but was defeated in the first round. The problem was that the agency risked suffering a mass exodus of personnel in the case of a move to Slovakia -- which may help to explain the decision.

Amsterdam and Paris will no doubt make excellent hosts. The assignment of EBA to Paris also represents a coup for the federalist and business-friendly agenda of French president Emmanuel Macron, who was quick to tweet that the choice was a "recognition of France's attractiveness and European engagement." Yet, the choices will inevitably reinforce the view that the core of Europe cares little for the periphery. After the crisis, the EU could have done better to show it knows how to be more inclusive.

Ferdinando Giugliano is an economics columnist for La Repubblica and was a member of the editorial board of the Financial Times.