Page 77 - bnemagazine bne_December 2021_20211203.pdf

bne December 2021 Opinion 77
THE VIEW FROM MITTELEUROPA
German traffic light coalition could worsen frictions with CEE
Marcus How and Gunter Deuber in Vienna
Suddenly, the odds on what was supposed to be the long shot have shortened considerably. On 21 October, the Social Democratic Party (SPD), Greens, and Free Democratic Party (FDP) said that they were planning to have the SPD’s Olaf Scholz confirmed as chancellor in the Bundestag by 6 December.
An Ampelkoalition (traffic light coalition) is thus looking increasingly likely. Yet the direction of foreign policy under such a government is less clear. The election campaign and the current negotiations have largely been dominated by domestic issues, such as tax, climate and social policy. Of the 10 chapters in the first joint coalition paper, only one is dedicated to foreign and European policy.
National elections are rarely fought on such issues. The Greens, FDP and, to a lesser extent, SPD variously advocate a greater geopolitical role for Germany. But there is little reason to expect greater dynamism from an Ampelkoalition. The focus on domestic policy suggests that approaches to “Europe and the world” will tread the well-worn path of previous German governments.
Indeed, while Germany has often underwhelmed its partners in its foreign policy concepts – for example by subordinating values-based approaches to trade – it has also been a major success economically. The abandonment of the principle of Wandel durch Handel (change through trade) would require an economic logic that does not currently exist.
Nevertheless, the devil is in the detail – and small differences
can have an impact. In the context of Central, Eastern and Southeastern Europe (CESEE), there are several indicators that suggest modest change ahead. The salient areas concern the direction of EU integration, the rule of law, approaches towards Russia and EU enlargement.
Convergence through divergence?
The prospects of further integration at the EU level are of
the most relevance for CESEE. The SDP and Greens are integrationist in their policy orientation. However, this is likely to be diluted significantly by the FDP, especially if it secures the finance ministry.
The FDP advocates restoring the constitutional debt brake as soon as possible. On the domestic level, a compromise will be possible through the shifting of debt-financed public investments from the primary budget to a bespoke agency. Large-scale spending by Germany – with the aim of making the 2020s “the decade of investments in the future” – will likely have positive spill-over effects for the rest of the EU, including the CESEE member states, many of which are key nodes in the German supply chain.
However, the entrenchment of spending infrastructure on the EU level is unlikely. The grants and loans enabled under the COVID-19 recovery package, Next Generation EU (NGEU), are unlikely to form the basis for either debt mutualisation
or budgetary pooling. The Stability and Growth Pact (SGP) will remain a sacred cow, even if it becomes increasingly irrelevant. At most, the FDP would support the completion of
The coalition paper briefly mentions the need for Europe to ensure the diversification of its energy supply but the Greens are likely to abandon their opposition to Russia's Nord Stream 2 gas pipeline.
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