Europe’s era of “Germany knows best” is coming to an end.
Berlin for the past decade commanded moral and financial authority in the EU, guiding policy and playing bad cop to the weaker southern economies. The energy crisis has upended that balance.
Germany’s reliance on Russia has exposed the flaws of its economic model — high-intensity industry running on cheap gas — and the blindness of its political class to its dependence on the Kremlin.
Illustration: Yusha
While Berlin is still coming to grips with the shock, Europe’s south is growing assertive. It is not revenge for years of German-led austerity, but a recalibration of forces that could ultimately result in a healthier EU.
Spain is an example. Spanish Minister for Ecological Transition Teresa Ribera bared teeth when she hit back at a European Commission proposal demanding that all 27 member states cut energy consumption by 15 percent this winter. In pushing back, Ribera said that Madrid had done its homework. It had little exposure to Russia and invested heavily in renewables — most importantly, she said, Spain had “lived within its means.”
The jab echoed the language from German rebukes at the height of the European financial crisis, when Berlin wrote the biggest checks in exchange for structural reforms that deepened the south’s economic slump.
The language was an unusual show of bravado for a country such as Spain, which is usually a net beneficiary of European funding. Reactions to her statements were split between those who said it was about time to call out the inconsistencies from Berlin and those fearful that such language risked inflaming old tensions.
In my view, Ribera’s comment was a mix of both, reflecting exasperation with the German reluctance to accept the monumental failure of its Russia policy. While everyone else seems to have realized “Made in Germany” was built on a shaky foundation, Berlin had yet to eat real humble pie, which is usually the first step before asking for help.
Spain was among the first to sound the alarm on the energy crisis, just as Putin began to squeeze supply and the market started to show signs of stress at the end of last year. Spanish Prime Minister Pedro Sanchez, who also faces enormous pressure to bring down inflation and energy bills at home, suggested in autumn last year that rocketing energy prices would require a joint European response.
Madrid argued — as it has for a while — that it needs better energy interconnectivity with the rest of Europe. Reducing consumption at home cannot help countries such as Germany if Madrid cannot export its surplus. Spain’s pitch fell on deaf ears, brushed aside as another example of the south seeking a handout.
Energy only became a European problem when the risks for Germany began to look insurmountable.
That reflects Europe’s policymaking problem — and points the way to a solution. It is time that proposals from southern Europe are taken more seriously. A rebalancing, if it leads to improved decisionmaking, should be welcomed in Brussels, where each leader speaks simultaneously to their domestic audience and their counterparts.
To their credit, the leaders of the southern nations agreed to a deal designed for Germany at record speed this week, moving beyond rhetorical resistance and avoiding critics’ schadenfreude.
It would have been silly and shortsighted, and, above all, a victory to Russia if the EU had failed. The Kremlin was caught off guard by the unity in Europe, and pitting Europeans against each other would undo that.
Ribera summarized it well after the deal was approved: In Europe, “when a neighbor calls for help, you have to help.”
That is the same spirit that got Europe through the COVID-19 pandemic and saw Germany cross its red line to agree to joint debt, a watershed moment for the EU. Plus, given their co-dependency, European crises are essentially circular. A recession in Germany, the euro area’s largest economy, would be detrimental for all.
A clash between northern and southern Europe would drag the continent back after a decade of joint problem-solving. Perhaps, considering the size of the German fiasco and the challenges it poses for the whole of Europe, Berlin should not be surprised to see the south asking for a bigger say.
Maria Tadeo is the European correspondent for Bloomberg Television and based in Brussels, where she covers European politics, economics and NATO. This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
Recently, China launched another diplomatic offensive against Taiwan, improperly linking its “one China principle” with UN General Assembly Resolution 2758 to constrain Taiwan’s diplomatic space. After Taiwan’s presidential election on Jan. 13, China persuaded Nauru to sever diplomatic ties with Taiwan. Nauru cited Resolution 2758 in its declaration of the diplomatic break. Subsequently, during the WHO Executive Board meeting that month, Beijing rallied countries including Venezuela, Zimbabwe, Belarus, Egypt, Nicaragua, Sri Lanka, Laos, Russia, Syria and Pakistan to reiterate the “one China principle” in their statements, and assert that “Resolution 2758 has settled the status of Taiwan” to hinder Taiwan’s
The past few months have seen tremendous strides in India’s journey to develop a vibrant semiconductor and electronics ecosystem. The nation’s established prowess in information technology (IT) has earned it much-needed revenue and prestige across the globe. Now, through the convergence of engineering talent, supportive government policies, an expanding market and technologically adaptive entrepreneurship, India is striving to become part of global electronics and semiconductor supply chains. Indian Prime Minister Narendra Modi’s Vision of “Make in India” and “Design in India” has been the guiding force behind the government’s incentive schemes that span skilling, design, fabrication, assembly, testing and packaging, and
Singaporean Prime Minister Lee Hsien Loong’s (李顯龍) decision to step down after 19 years and hand power to his deputy, Lawrence Wong (黃循財), on May 15 was expected — though, perhaps, not so soon. Most political analysts had been eyeing an end-of-year handover, to ensure more time for Wong to study and shadow the role, ahead of general elections that must be called by November next year. Wong — who is currently both deputy prime minister and minister of finance — would need a combination of fresh ideas, wisdom and experience as he writes the nation’s next chapter. The world that
As former president Ma Ying-jeou (馬英九) wrapped up his visit to the People’s Republic of China, he received his share of attention. Certainly, the trip must be seen within the full context of Ma’s life, that is, his eight-year presidency, the Sunflower movement and his failed Economic Cooperation Framework Agreement, as well as his eight years as Taipei mayor with its posturing, accusations of money laundering, and ups and downs. Through all that, basic questions stand out: “What drives Ma? What is his end game?” Having observed and commented on Ma for decades, it is all ironically reminiscent of former US president Harry