Since Angela Merkel's disastrous decision to get rid of nuclear power in Germany, Germany became extremely dependent on fossil fuel imports. When the situation in Eastern Europe worsened, Germany had to start reopening coal mines. Major industrial players in Germany alerted the German coalition that they need to have secure energy supplies. Unfortunaly, the coalition led by Olaf Scholz is deaf and intends to send German gas to Ukraine. What is even more astonishing is that countries like Netherlands that have gas stocks were thought to be diverting their own supplies to Germany.
In the midst of recession, diverting gas supplies away from German industries makes a bad situation even worse. If German manufacturing falters, the possibility of job loses, export losses and industrial unrest rises. Although the next Federal Election is still a long way into the future, if the worst happens, the future of the ruling coalition will be in doubt. It was hard for SPD to negotiate a deal that could unite conservatives FDP and Greens. For the German economy, there has been a triple whammy: loss of nuclear energy, higher prices of oil and gas plus exports of gas to other countries.
Germany is the engine of the EU. Will the coalition survive until the next Federal Election. The longer the conflict in Eastern Europe goes on the worse the prospects for the German economy. The axe Berlin/Paris is also going through challenges. President Macron will not be around for another mandate. One word that describes what is happening in France is 'uncertainty'. Who will step in to challenge Rassemblement National?
This is a tour de force, a game of political survival. As all the weapons sent to Ukraine are being systematically destroyed, the European Union risks being naked because what is being sent is not being replaced. Taxes going up in the midst of recession to pay for the war effort?
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