Brussels Playbook
By JAKOB
HANKE VELA
with ZOYA
SHEFTALOVICH
DRIVING THE
DAY: CARS BACK FROM THE DEAD
EU
AMBASSADORS REVIEW CAR ENGINE DEAL: Ambassadors of the EU’s 27 countries will
this morning review a deal struck Saturday by Germany and the European
Commission, which paves the way for the sale of cars running on synthetic
e-fuels even after combustion-engine vehicles are banned from 2035.
Berlin and
Brussels struck the deal just hours after EU leaders left their summit in
Brussels on Friday. The key is an agreed statement, endorsed by both the
Commission’s Green Deal chief Frans Timmermans and Germany’s Transport Minister
Volker Wissing, that commits to finding a legislative path to incorporate a
carve out for e-fuels (which emit CO2 at the tailpipe) into the 2035 mandate at
Berlin’s behest. The Commission says it will publish legislation by the fall,
and the Germans say they want the process resolved by fall 2024. Josh Posaner
has the full details here.
End of an
ugly chapter: Now that its concerns have been resolved, the German government’s
three-way coalition has agreed a set position for its ambassador after weeks of
threats to crash the deal. Which should mean everything runs smoothly today —
Germany should be in favor of the legislation as agreed, without reopening it.
But given its history of second thoughts on this file, no one will declare
victory until it’s really over.
Timing: The
meeting of ambassadors starts at 10 a.m., so we expect to know by mid-afternoon
whether the EU is on track to pass the 2035 zero-emissions sales mandate for
cars and vans into law. Transport ministers are then expected to give the final
rubber-stamp on Tuesday.
**A message
from Meta: With the metaverse, firefighters will one day be equipped with
augmented reality that will enable them to better navigate burning buildings
and rescue people faster.**
Taking
credit: As we reported, cars weren’t formally on the agenda at the leaders’
summit, but everyone was talking about the issue. Following the announcement on
Saturday morning of a breakthrough, Austria’s Chancellor Karl Nehammer was
quick to talk up the “green combustion engine” plan. “It’s about progress, not
prohibitions,” he said. Nehammer also claimed he’d worked “side-by-side” with
Germany on this over recent weeks.
Germany’s
domestic e-fuels push starts: Not content with basking in the deal with
Brussels, German media reported Sunday that e-fuels fan Christian Lindner, the
country’s finance minister, was planning to reform Germany’s tax system to
offer drivers lower rates if they fuel up on synthetic alternatives to
gasoline. A legal proposal is on the way. That’s aimed at spurring production
of such fuels in the coming years.
NOW READ
THIS: Bickering between Berlin and Paris is deflecting attention from the EU’s
mission to steer a course toward net zero via a clean-tech strategy that’s
meant to keep Europe competitive with the U.S. and China, write my colleagues
Charlie Cooper and Karl Mathiesen in this analytical piece.
RUSSIAN
ASSETS SCOOP
FROM RUSSIA
WITH INTEREST: The EU is looking into investing frozen assets belonging to the
Russian central bank to reap returns, according to a paper by the Commission
set to be discussed on Tuesday by national experts, and obtained by my
colleague Paola Tamma.
Show me the
money: G7 countries, the EU and Australia together froze $300 billion of
Russian central bank assets at the beginning of the war, two-thirds of which is
believed to be in the EU. Member countries agreed on an obligation to report on
the whereabouts of frozen Russian assets in its latest sanctions package
against Moscow to try to get a clearer picture.
The
Commission paper looks at the legal grounds for investing Russian foreign
reserves, and finds that while Moscow should be able to recover the original
capital and any contractually agreed interest prior to the assets being frozen,
any returns in excess of that could be appropriated for the purpose of helping
rebuild Ukraine. That approach would require tweaking the EU sanctions regime to
allow investing central bank assets in short-term bonds and bills from EU
sovereigns, and could generate around 2.6 percent annual returns.
Better
together: The Commission’s paper stresses that taking coordinated action with
G7 and other countries would have “both political and market advantages,” by
avoiding spooking investors, who could shun European financial infrastructure
if the EU acted unilaterally.
What if
they lose it? The paper suggests investing in “liquid, highly-rated assets.”
Investing in equity would carry higher returns, but raises “political and
financial implications” if the EU were to reimburse Russia for losses incurred
while investing its assets — whereas “the risk of losses on a high
credit-quality, shorter-term portfolio at current yields seem very remote.”
Still, “losses can never be excluded,” and so the question of “who bears any
residual risk in case [of] such losses … will require a clear legal answer,”
the Commission writes.
NORD STREAM
MYSTERY LATEST: Five days before explosions damaged three of the four Nord
Stream pipelines last year, a convoy of six Russian naval vessels was spotted
in the area of the pipelines, German news site T-online reports, citing
open-source intelligence research. The report again raises the specter of
self-sabotage by Moscow. Russian President Vladimir Putin denies any
responsibility for the attack and has blamed the U.S. and U.K. for it. (My
colleague Charlie Cooper had this analysis of who had motives for blowing up
Nord Stream.)
SANCTIONS
CALL AS PUTIN GOES NUCLEAR: The West and Ukraine condemned Putin’s announcement
on Saturday that Moscow would station tactical nuclear weapons in neighboring
Belarus by July. The German Federal Foreign Office told reporters the decision
was akin to a “further attempt at nuclear intimidation,” NATO called the move
“dangerous and irresponsible,” and officials in the U.S. also expressed
concern. Lithuania’s foreign ministry said in a statement Sunday that it will
“discuss with its Euro-Atlantic partners how to respond,” and “will call for
the adoption of new sanctions.”
TUNISIA IN
FOCUS
GENTILONI’S
SENSITIVE MISSION: Europe’s Economy Commissioner Paolo Gentiloni is heading to
Tunisia today to discuss EU financial assistance. The mediterranean country,
once the most hopeful nascent democracy after the Arab Spring, descended into
turmoil after President Kais Saied orchestrated what critics describe as a
coup. “We want to help Tunisia to generate sustainable economic growth, new
jobs and better opportunities for Tunisians, especially women and young
people,” Gentiloni told Playbook ahead of his trip.
Money for
reforms: “The EU needs a stable and prosperous Tunisia, which is why we are
ready to consider additional macro-financial assistance if the necessary
conditions are met. This means not only having a new IMF program up and running
but also maintaining respect for human rights and shared democratic values,”
Gentiloni said, adding he was looking forward to “intensive and, I trust,
constructive discussions with the Tunisian authorities.”
Background:
Years of economic hardship have accentuated the political instability in the
country. The European Parliament and human rights watchdogs accused Saied of an
authoritarian drift. Saied has claimed migrants from sub-Saharan Africa are
trying to erase his country’s national identity.
It’s
migration that has mobilized EU leaders. They discussed the issue at last
week’s summit, after Italy registered a surge in arrivals from Tunisia. A
public report from Italy’s intelligence services in February claims that around
half of migrant arrivals in 2023 left from Tunisia. Speaking to reporters on
Friday, Italy’s Prime Minister Giorgia Meloni said she was warning fellow EU
leaders that Tunisia’s financial woes “risk unleashing an unprecedented flow of
migrants,” and stressed the need to “support the country’s stability,” my
colleagues Gregorio Sorgi and Paola Tamma report.
Latest
tragedy: At least 29 migrants died when two boats sank off the coast of Tunisia
as they tried to cross the Mediterranean to Italy, the Tunisian coast guard
said on Sunday. Reuters has more.
Money for
Tunis: Rome is pushing the IMF to greenlight a $1.9 billion package to Tunisia,
in the hopes it will provide a lifeline to the country’s struggling economy.
Tunisia reached a deal with the IMF in September, but talks have been stalled
for months as the government failed to deliver on reforms.
EU cash on
the table: Gentiloni will discuss with Saied and other members of government
the potential disbursement of EU macro-financial assistance, but an
announcement is not expected today. On Friday, Meloni said “the MFA is included
in the IMF’s work, it is part of the same package,” and stressed that the
unblocking of the IMF’s pot of money remains the top priority.
What’s
next: Gentiloni’s trip kicks off a flurry of diplomatic activity: Home Affairs
Commissioner Ylva Johansson said she’ll be heading to Tunisia in April and
Meloni on Friday confirmed an upcoming joint Italo-French foreign ministers’
mission.
**NEW PRODUCT
UDPATE - As of tomorrow, POLITICO’s China Direct newsletter becomes China
Watcher. It will hit inboxes twice weekly (Tuesday & Thursday). POLITICO's
EU-China Correspondent Stuart Lau will be writing this expanded newsletter
together with our colleague Phelim Kine from across the Atlantic in Washington.
We’re living in a world where geopolitics are shaped and reshaped in Brussels,
Washington, and Beijing — and we know how much you would want a full picture
before making your decisions, no matter which government ministry, embassy,
company, start-up or think tank you’re from. Sign up to China Watcher.**
CHINA
CORNER
REWRITING
MERKEL’S CHINA PLAYBOOK: Germany’s opposition Christian Democrats are planning
to shift away from the pragmatic stance toward China that characterized Angela
Merkel’s 16 years as chancellor, claiming that maintaining peace through trade
has failed, my colleague Gabriel Rinaldi reports. According to a draft position
paper seen by Gabriel, the conservatives say the idea of keeping peace through
economic cooperation “has failed with regard to Russia, but increasingly also
China.” The paper is to be adopted by the CDU/CSU parliamentary group in the
Bundestag around Easter.
CLINGING TO
TIKTOK: Staff at the European Parliament were ordered to delete TikTok from any
work devices by March 20. But MEPs and political groups are opting to stay on
the video-sharing application, seeking to win over the platform’s user base of
young voters. One of the ways they’re staying on the app is by using dummy
phones, my colleagues Eddy Wax and Clothilde Goujard report.
WHAT
SÁNCHEZ WILL TELL XI: Spanish Prime Minister Pedro Sánchez will tell China’s
President Xi Jinping that any peace in Russia’s war on Ukraine should respect
the latter’s “territorial integrity” and be “fair and lasting.” Sánchez is
traveling to China to meet with Xi this week. Reuters has more.
VDL TAGGING
ALONG WITH MACRON: And in case you missed this news last week, Ursula von der
Leyen will travel with French President Emmanuel Macron to China on April 4, on
her first journey to Beijing as Commission president.
IN OTHER
NEWS
CHANGING
TIMES: Most European countries moved their clocks forward an hour on Sunday.
For Greenland, that was the last time — come October, the island will keep
summer time, unlike the rest of the EU.
Wait,
didn’t Brussels promise to end clock changes? The Juncker Commission unveiled a
proposal to abolish the twice-yearly time change back in 2018, with the
European Parliament giving its backing too. But EU countries pumped the brakes,
and while the EU was supposed to have done away with time changes by now, the
plan remains in the deep freeze.
Any hope of
progress? Not any time soon. The EU is preoccupied with other things, and in
order to move forward with the plan, the file must be on the agenda of the
country holding the rotating Council presidency. As of now, neither Spain nor
Belgium, the countries that are next in line for the hot seat, have announced
plans to push the proposal.
ISRAEL
LATEST: The U.S. overnight urged “Israeli leaders to find a compromise as soon
as possible,” as widespread unrest broke out in Israel after Prime Minister
Benjamin Netanyahu fired his defense minister for objecting to judicial reforms
the PM is seeking to enact. Photos and footage here, h/t Tal Schneider.
There’s a protest planned in Brussels this afternoon — more info below.
PLAYING
CATCH-UP ON TECH: In a damning report out today, the leaders of Europe’s
industrial titans warn that the Continent should speed up its investment in
research and development, especially in information and communications tech, to
stay competitive. “Compared to our global peers and competitors, Europe’s
investment in R&D is relatively low,” says the report by the European Round
Table for Industry — which assembles CEOs and chairs from companies like BASF,
Airbus and ASML. “With a few exceptions, we’re far behind in the tech race in
the ICT area, and this endangers Europe’s position in the next industrial
revolution,” according to the text, seen by POLITICO’s Pieter Haeck.
DON’T MESS
WITH MICHELANGELO: A school board in Florida made news last week after forcing
out a principal for showing Michelangelo’s David to her art students — after
complaints from parents that it was “pornography.” On Saturday, the mayor of
Florence, Dario Nardella, shot back at the “ridiculous” decision: “I will
personally invite the teacher to Florence to give her a recognition on behalf
of the city,” Nardella tweeted. “Art is civilization and those who teach it
deserve respect.”
Sem comentários:
Enviar um comentário