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GERMANY AND FRANCE

German government delays talks with France as discord builds

Germany and France postponed a meeting set for next week between their governments until January as Berlin said that "more time" was necessary to find common ground on a slew of issues.

Olaf Scholz and Emmanuel Macron
German chancellor Olaf Scholz with Mark Rutte, Prime Minister of the Netherlands and French President Emmanuel Macron in Prague on October 7th. Photo: picture alliance/dpa/CTK | Deml Ondøej

The delay to the regular meeting hosted alternately by either cabinet exposed a growing rift between the two EU powers, and comes as Europe struggles to cope with an energy and cost-of-living crisis unleashed by Russia’s invasion of Ukraine.

Chancellor Olaf Scholz’s spokesman Steffen Hebestreit would not be drawn on the topics that the governments were unable to agree on.

But he acknowledged that “there are a number of different issues that we are dealing with at the moment… on which we have not yet reached a unified position.”

Both sides therefore decided it was “sensible” to postpone the talks originally to be hosted by France to January.

READ ALSO: France begins sending gas to Germany in ‘act of EU solidarity’

Scholz will nevertheless hold bilateral talks with French President Emmanuel Macron on the sidelines of the EU summit starting Thursday, Hebestreit said, adding that the pair may also meet next Wednesday in Paris.

France and Germany have often tried to present a united front in a myriad of crises, but over the last weeks, criticisms have spilled out into the open on issues ranging from energy to defence.

“There has always been times of disagreements, but here, it’s more serious,” said Jacques-Pierre Gougeon of the French Institute for International and Strategic Affairs.

Points of contention

After Scholz’s government announced a €200 billion support scheme to protect its businesses and consumers from runaway energy prices, Macron has warned the programme risked leading to “distortions” in the bloc.

“If we want a coherent approach, it is not national strategies that need to be adopted but a European strategy,” Macron argued in an interview published on Monday by French daily Les Echos.

France has however, on a national level, introduced a price cap on energy prices.

Berlin has also been accused of blocking at the EU level a cap on gas prices which it fears would remove an incentive for consumers to save energy, thereby worsening the situation.

France, however, which is suffering an electricity shortage because several of its nuclear power plants are out of service, has been pushing for the cap.

Berlin was meanwhile unhappy with Paris over a lack of support for its bid to revive the so-called Midcat gas project for pipelines linking Portugal, Spain, through France to Germany.

While providing an immediate relief for gas supplies to the continent, Germany is also hoping that the pipeline could in future be used to transport hydrogen.

France shuns the Midcat because of its cost, and believes it is not necessary as the country already has sufficient liquefied natural gas terminals on its coast.

On military issues, Germany’s recent success in rallying 14 NATO members to join its air shield project has irked France which is eyeing a separate plan.

Paris disputes Germany’s plan to purchase an Israeli air-shield system rather than to seek a European solution, as France is developing its own missile-defence system with Italy.

READ ALSO: Scholz defends German energy plan against EU critics

By Hui Min Neo

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POLITICS

‘Dexit’ would cost Germany ‘€690 billion and millions of jobs’

According to the German Economic Institute (IW), Germany's exit from the EU – the so-called Dexit – would cost millions of jobs and significantly reduce the country's prosperity.

'Dexit' would cost Germany '€690 billion and millions of jobs'

In a study presented by the Cologne-based institute on Sunday, the authors showed that a Dexit would cause real GDP to drop by 5.6 percent after just five years. This means that Germany would lose 690 billion euros in value creation during this time.

In addition, Germany as an export nation is dependent on trade with other countries, especially with other EU countries, warned the authors. Companies and consumers in Germany would therefore feel the consequences “clearly” and around 2.5 million jobs would be lost.

The study is based on the consequences of Britain’s exit from the EU, such as the loss of trade agreements and European workers.

Taken together, the losses in economic output in Germany in the event of a Dexit would be similar to those seen during Covid-19 and the energy cost crisis in the period from 2020 to 2023, the authors warned.

Brexit is therefore “not an undertaking worth imitating,” warned IW managing director Hubertus Bardt. Rather, Brexit is a “warning for other member states not to carelessly abandon economic integration.”

Leader of the far-right AfD party Alice Weidel described Great Britain’s exit from the European Union at the beginning of the year as a “model for Germany.”

In an interview published in the Financial Times, Weidel outlined her party’s approach in the event her party came to power: First, the AfD would try to resolve its “democratic deficit” by reforming the EU. If this was not successful, a referendum would be called on whether Germany should remain in the EU.

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