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41. Dialogue with Russia: Russia Needs to Reset Relations with the West

Author:
Kalev Stoicescu, Liana Fix, Agnieszka Legucka, Tatiana Kastouéva-Jean, Artūrs Bikovs, and Keir Giles
Publication Date:
06-2021
Content Type:
Special Report
Institution:
International Centre for Defence and Security - ICDS
Abstract:
Moscow’s resurgent foreign policy and the undemocratic rule of President Vladimir Putin ended the relatively friendly relations that had been possible between Russia and the West in the 1990s. In the seven years since Russia annexed Crimea and started a war of attrition against Ukraine, the security situation in the transatlantic region has continuously deteriorated. The Kremlin has demonstrated hostility towards the West, crises and security issues have continued to multiply instead of being resolved, and the risk of outright conflict has come close to Cold War peaks. There is an obvious and urgent need to lower tensions, but Moscow prefers to demonstrate its readiness to escalate. This report analyses Western-Russian relations and proposes a way forward for conducting dialogue with Russia. It offers an analysis of Russia’s relations with NATO and the EU, an overview of the bilateral relations of various Western countries with Russia, a glimpse of China’s role, and an assessment of the main interests and contentious issues in Western-Russian relations.
Topic:
Foreign Policy, NATO, International Affairs, and European Union
Political Geography:
Russia, United Kingdom, Europe, France, Poland, Germany, Latvia, and United States of America

42. The ‘Magnificent Seven’ of European Defence Integration

Author:
Spyros Blavoukos and Panos Politis-Lamprou
Publication Date:
06-2021
Content Type:
Working Paper
Institution:
Hellenic Foundation for European and Foreign Policy (ELIAMEP)
Abstract:
Defence cooperation in the EU is growing, reflecting the European citizens’ view of the EU as a security enhancer. This policy paper takes stock of current developments and analyses the positions of seven EU member-states on defence integration (France, Germany, Italy, Spain, Poland, Portugal, and Greece). The ‘Magnificent Seven’ are key players in this process, not least because of their large defence budgets and their engagement in the existing forms of cooperation. We examine the defence budget of the seven countries and their breakdown, as well as their participation in Battlegroups, EU military operations and missions, and PESCO projects. The analysis provides significant insights on the national defence priorities. The seven countries form overlapping clusters, according to their political status and aspirations in the European integration process, their economic condition, their geographical location, and their relations with the US and NATO. All of them are facing significant dilemmas and engage in subtle balancing acts, which explains the slow and arduous path of European defence integration.
Topic:
Defense Policy, Military Affairs, European Union, and Regional Integration
Political Geography:
Europe, Greece, France, Poland, Germany, Spain, Italy, and Portugal

43. The Automotive Industry: The Achilles’ Heel of German Economy?

Author:
Marie Krpata
Publication Date:
03-2021
Content Type:
Special Report
Institution:
Institut français des relations internationales (IFRI)
Abstract:
The global car market has been shrinking since 2018. This is a key economic sector for Germany whose producers belong to the Top 15 carmakers worldwide. Yet they are running the risk of being outclassed and eventually replaced, given emerging actors in the USA and China. These new competitors benefit from the growing digitization of the mobility sector, disruptive economic models and the obsolescence of vehicles with an internal combustion engine. This form of propulsion is progressively being replaced by less-polluting alternatives, which are being endorsed by public authorities. The Chinese-American rivalry is also impacting German carmakers, whose strategy greatly relies on the globalization of production chains. This has led to major successes in the past, but the threat of a technological decoupling between the USA and China limits German carmakers’ activities in terms of production and exports. Access to the Chinese market, which accounts for nearly 20% of the global population, is indispensable for the German brands that intend to benefit from China’s catch-up effects. European industrial and political actors plan to invest in promising sectors whilst seeking to respect environmental and social objectives. Also, the European Union (EU), led by a German powerhouse, intends to prevent market distortions such as hurdles to market access, while supporting the emergence of technologies and the compliance with production standards. However, developments in the automotive sector are challenging the EU’s capacity to act in a unified fashion, even if the EU is not seeking to impose its vision on the industry’s private sector, in a top-down manner.
Topic:
Climate Change, Economics, Energy Policy, Industrial Policy, European Union, Social Policy, Mobility, Industrialization, Green Deal, and Automotive Industry
Political Geography:
Europe and Germany

44. Complementarity or Competition? Franco-British Cooperation and the European Horizon of French Defense Policy

Author:
Alice Pannier
Publication Date:
04-2021
Content Type:
Special Report
Institution:
Institut français des relations internationales (IFRI)
Abstract:
What does future hold for the Franco-British defense partnership after Brexit? France and the United Kingdom have, for long, enjoyed a close defense relationship, thanks in part to their analogous strategic cultures. The 2010 Lancaster House treaties built on this proximity to expand cooperation in the fields of nuclear weapons, force projection, interoperability and industrial integration. In spite of genuine progress in the first years following the treaties, the Franco-British strategic partnership has had to face two pitfalls: on the one hand, Brexit and its political consequences for the United Kingdom, and, on the other hand, President Macron’s attempt to revive European defense and Franco-German cooperation. The tenth anniversary of Lancaster House should offer the opportunity to rethink the convergence between bilateral cooperation and the resolutely European horizon of French defense policy.
Topic:
Defense Policy, Bilateral Relations, European Union, and Cooperation
Political Geography:
United Kingdom, Europe, France, and Germany

45. COVID-19 financial aid and productivity: has support been well spent?

Author:
Carlo Altomonte, Lionel Fontagné, Maria Demertzis, and Steffen Müller
Publication Date:
11-2021
Content Type:
Working Paper
Institution:
Bruegel
Abstract:
Most European Union countries have made good progress with vaccinating their populations against COVID-19 and are now seeing a rebound in economic activity. While the scarring effects of the crisis and the long-term implications of the pandemic are only partially understood, the effects of support given to firms can be evaluated in order to help plan the removal of crisis support. European regions and countries that depend heavily on services requiring physical proximity have been hit hardest by COVID-19-related measures. But these services sectors tend also to be the smallest and least-productive in any economy, implying that, coming into the crisis, the highest shares of zombie firms were in these sectors. Reliance on physical proximity and the higher incidence of zombies to start with have combined to make those services-dependent economies particularly vulnerable to any attempt to remove the support put in place during the pandemic. The evidence shows that the main goal of the provision of support during the COVID-19 crisis, namely to protect employment, has been achieved. However, the evidence is varied on how efficiently this was done, in terms of helping firms that have a good chance of surviving, while not supporting those that will in any case exit. An analysis of France, Germany and Italy shows the potential for ‘cleansing effects’ in that it was the least-productive firms that have been affected most by the crisis. While support was generally not targeted at protecting good firms only, financial support went by and large to those with the capacity to survive and succeed. Labour schemes have been effective in protecting employment.
Topic:
European Union, COVID-19, and Financial Aid
Political Geography:
Europe, France, Germany, and Italy

46. Building European Resilience and Capacity to Act: Lessons for 2030

Author:
Roderick Parkes, Anna-Lena Kirch, and Serafine Dinkel
Publication Date:
07-2021
Content Type:
Special Report
Institution:
German Council on Foreign Relations (DGAP)
Abstract:
Containing twelve scenarios for the world in 2030, this report offers insights into how the EU can maintain and build up its capacity to act in the face of the major disruptive changes that are likely to come over this decade. It is being released in the run-up to German elections in September 2021 that will serve as a kind of referendum on ten years of government-heavy crisis management.
Topic:
Elections, European Union, Crisis Management, and Resilience
Political Geography:
Europe and Germany

47. Germany’s Debt Brake and Europe’s Fiscal Stance after COVID-19

Author:
Shahin Vallée, Jérémie Cohen-Setton, and Dominik Buhl
Publication Date:
05-2021
Content Type:
Policy Brief
Institution:
German Council on Foreign Relations (DGAP)
Abstract:
Germany’s plan to return to its debt brake creates a serious risk of premature fiscal tightening. Given that the fiscal divide between Europe and the US will widen sharply in 2021, a hasty return to European and German fiscal rules would stifle recovery and undermine efforts to rebuild transatlantic ties in trade and macroeconomic cooperation. This paper proposes several practical options to attenuate the fiscal drag associated with a return to the debt brake and calls for a broad debate on its reform.
Topic:
Debt, European Union, Finance, Transatlantic Relations, and COVID-19
Political Geography:
Europe, Germany, and United States of America

48. A Capable EU Is No Utopia: Strategic Lessons from the German Presidency

Author:
Anna-Lena Kirch
Publication Date:
03-2021
Content Type:
Commentary and Analysis
Institution:
German Council on Foreign Relations (DGAP)
Abstract:
Overall, as the COVID-19 crisis unfolded, the EU proved capable to act. Crisis management addressing the pandemic benefited from the fact that Germany held the presidency of the EU Council in the second half of 2020 and could build upon its traditional approach: developing European capabilities, including all governments, and being prepared for the unexpected. Now, going forward, Germany needs to use its experience with complexity and uncertainty to help form a strategic doctrine for the EU.
Topic:
European Union, Crisis Management, and COVID-19
Political Geography:
Europe and Germany

49. The EU One Year after the Covid-19 Outbreak: An Italian-German Perspective

Author:
Nicoletta Pirozzi, Luca Argenta, and Paweł Tokarski
Publication Date:
02-2021
Content Type:
Working Paper
Institution:
Istituto Affari Internazionali
Abstract:
The spreading of the Covid-19 pandemic and its economic and social consequences have radically changed the reality of the 27 EU member states. After scattered reactions at the beginning of the crisis, the EU has taken an unprecedented step towards cohesion and solidarity with the Next Generation EU. However, in order to ensure recovery and resilience, the EU will need to act simultaneously on three levels: end the pandemic in the shortest time possible through mass vaccination, implement structural reforms and address the challenges of tomorrow, including also digitalisation and the fight against climate change. To realise these objectives, citizens’ engagement and mobilisation would be essential, thus giving new urgency to the Conference on the Future of Europe, which should be turned from a consultation process into a tool for the relaunch of the Union post-Covid. Paper published as a follow-up to the 2020 edition of the German-Italian Strategic Forum on Europe, jointly organised by IAI, FES and SWP on 27 November 2020.
Topic:
Politics, Public Opinion, European Union, Economy, Institutions, and COVID-19
Political Geography:
Europe, Germany, and Italy

50. Europe's Quest for Digital Sovereignty: GAIA-X as a Case Study

Author:
Simona Autolitano and Agnieszka Pawlowska
Publication Date:
04-2021
Content Type:
Working Paper
Institution:
Istituto Affari Internazionali
Abstract:
There is currently much discussion about “digital sovereignty” in Europe. While the term encompasses very diverse connotations, it refers to a broad concept involving data, technological, regulatory and political elements. Cloud computing represents one example of the concrete materialisation of the European Union’s quest for “digital sovereignty” – especially through the development of its GAIA-X project. It is too early to assess whether or not GAIA-X will definitively help the Union to achieve this much-desired goal; however, some challenges have already emerged along the way. Looking to the future, if the EU wants to achieve “digital sovereignty”, a different strategy to the one currently under discussion will be needed. Study produced as part of the project “La geopolitica del digitale”, March 2021.
Topic:
Politics, European Union, Institutions, Digital Policy, and Digital Sovereignty
Political Geography:
Europe, France, and Germany