Trans-Europe Express: German coalition talks – Blessing or curse for Europe?

Sent out every Friday at noon, Trans-Europe Express gives you an insider's view of the most important coverage from across the EURACTIV media network, its media partners and much more.

Many saw the last German government as a tanker ship cruising stolidly and unswervingly through the stormy seas of world politics. But in the past few weeks, it has looked like the German ship and Captain Angela Merkel are about to start rolling and listing.

Almost two months after the elections and after the liberal-conservative FDP pulled out of the coalition talks with a bang – which some consider a calculated move – Germany is still without a government.

At the same time, change is in the air. Where days ago there were talks about a Merkel-led minority government or an election re-run in March 2018, now a renewed grand coalition between Merkel’s Christian Democrats (CDU) and the social-democratic SPD appears thinkable again. Whatever arrangement is reached in the end, it should come quickly: without a stable government in Berlin, Europe is paralysed.

However, it is also a fact that before and after the Bundestag elections, all potential coalition partners showed downright ignorance with regards to the European reform process.

In terms of EU policies, the only thing one could hear from CDU/CSU, FDP and the Greens during the coalition talks was a promise of a tough “application of the Growth and Stability Pact” – even though these rules on deficits and public spending have in the past proven to be an economic hindrance rather than a driving force for reform.

While French President Emmanuel Macron envisions a democratisation of the EU’s legislative processes and improved crisis management, German support – let alone ideas – is virtually non-existent. Fearing neo-nationalists and right-wing populists, the democratic parties in Germany have silently said good-bye to the debate on EU reform.

Pessimists now see the big tanker ship slowly running aground. The protracted government-forming process is already casting its shadow and dampening expectations regarding the December EU summit. Some Brexiters see Merkel’s weakness as a window of opportunity to push for advantages in the exit negotiations.

And the European Commission is anything but amused: “The issue of deepening the European Monetary Union is on the agenda and I urgently need to receive a list with expectations, priorities and also red lines for the next decade’s EU-budget which I am to present this coming May. The harmonisation of asylum laws as well as migration policy are other keywords for which we need a German government that is able to act,” warned Budget Commissioner Günther Oettinger, a member of Merkel’s own party.

While some European neighbours shake their heads in disbelief and fear at the German impasse, other observers see new opportunities arising.

If a grand coalition really is on the horizon, the SPD will be in a strong position to forge ahead with many of its social and EU policy demands. And if there are new elections in March, the parties would have the chance to finally put the future of the European project at the centre of their campaigns.

After all, Macron’s victory in France has shown: you can win over a majority with visionary European policies. Maybe the German tanker will eventually morph into a European speedboat setting course for reforms.

Inside Track

United for Europe. All the political families consulted by the French presidency seem to favour a national list to replace regional ballots for the 2019 European elections, with the exception of some centre-right deputies.

Nuclear loophole. Internal documents seen by EURACTIV show that the Commission assisted Hungary in finding the right loophole in EU public procurement rules to get the green-light for the construction of the Russian-backed Paks II nuclear power plant.

Jamaica-collapse. After talks between Germany’s four political parties collapsed, the acting government’s capacity to participate in EU-level decisions is limited while a number of decisions on EU-level is coming up.

Climate bill.  Rich countries pledged to raise $100bn each year in climate finance for developing countries by 2020. But currently the pledges only add up to $10.3bn, open questions remain who should pay remains, EURACTIV reports from the COP23 in Bonn.

Green Luxembourg. Luxembourg’s finance and environment ministers joined with directors of the European Investment Bank to launch a de-risking mechanism that will allow financing of climate-friendly projects.

Long-awaited justice done. A UN tribunal convicted former Bosnian Serb military commander Ratko Mladić of genocide and crimes against humanity committed in Bosnia and sentenced him to life in prison.

End of frozen conflicts? There are good prospects for finding a solution to the Transnistria conflict, one of the post-Soviet frozen conflicts which have caused enormous harm to the region’s populations, Moldovan Prime Minister Pavel Filip told EURACTIV in an exclusive interview.

Agency thriller. Amsterdam and Paris won the right to host the two EU agencies that must leave London on Brexit after a dramatic ministerial meeting in Brussels that left both result decided by drawing lots after votes were tied.

Coalition in sight. Unlike in Germany, Austrian coalition negotiations have progressed much further. The ÖVP wants to have everything signed, sealed and delivered before Christmas.

Re-energise Europe. Europe must not stand still, and the recently approved Leaders Agenda is a step in the right direction, but we must seize the current window of opportunity, argue Herman Van Rompuy and Janis A. Emmanouilidis.

‘Sanitary cutting’. Poland reacted coolly to a warning it could incur fines up to €100k a day for continuing to log in the Białowieża forest, a UNESCO World Heritage site, saying its actions were lawful.

Bulgarian presidency. President Rumen Radev, whose country takes over the EU’s rotating Presidency in 2018, in an interview with EURACTIV discussed EU policies, the upcoming Bulgarian Presidency and his contradictions with Prime Minister Boyko Borissov.

Smokeless cinema. The idea of banning smoking in films in order to make tobacco consumption less glamorous was recently supported by the Commission, an EU official told EURACTIV.

Retroactive changes. Poland economy has been growing its share of renewable energies to decarbonise it as a challenge towards stereotypes of coal-addict of Europe. However, the deployment of renewables appears to have come to a halt since 2015 peak.

The Immortal. Italy’s scandal-plagued Silvio Berlusconi takes his comeback bid to the European Court of Human Rights in Strasbourg, asking it to weigh in on his ban from holding elected office.

Fears of hard Brexit. Britain’s grain sector does not have the scale to stand on its own two feet outside the EU, a leading representative of farming has warned.

Historic mistake. McAllister stressed that a no-deal scenario was the worst possible outcome. Speaking of the failed coalition talks in Germany, he said the best option was a grand coalition with the SPD, rather than a minority government or a new election.

Slavic unity. While Slovak president Andrej Kiska spoke in Strasburg about the need to counter Russian propaganda, the President of the Parliament Andrej Danko praised “pan-Slavic unity” in the Russian Duma.

Historic hero and patriot‘. Judging by the mixed reactions to the life sentence the UN Tribunal has handed Ratko Mladić, the former Bosnian Serb Army commander, reconciliation in the region after the wars of the 1990s is still far away.

Views are author’s