And the winner is…
Olaf Scholz has been confirmed as the winner of the German elections by a slim 1.6% margin. While Scholz will get the first chance to form a government, the task will be arduous and can take months before we will have an idea of how a future German Government will look like. All options are on the table with analysts pointing towards a “traffic-light coalition” composed of SPD reds, the Greens and the yellow Liberals. An extension of the grand coalition has been ruled out, with the SPD declaring that Merkel’s party should sit on the Opposition benches. A Chancellor will be chosen by Parliament once the parties have agreed on a governing coalition. Diplomats in Brussels are eager to see how this change will affect the EU’s direction in the coming months and years.
Off again, on again!
One of the reverberations of the now dubbed ‘subgate’ – the agreement between Australia, UK and the US for nuclear submarines, was the Trade and Tech Council between the EU and the US, scheduled to take place this week in Pittsburgh. While preparations were in full swing, the French, as a retaliation for their ‘humiliation’ by the US, were piling on pressure on the EU to cancel the Trade and Tech Council. While they almost managed to derail the process, in a tweet on Thursday evening, European Commissioner Margarethe Vestager confirmed the EU’s participation in the meeting.
In a sign of support for France, European Commission President Ursula von der Leyen declared that this was a breach of trust on the whole European Union, a message echoed by European Council President Charles Michel.
Reminder: The previous submarine deal with the French was worth €50 billion and until a couple of weeks ago the Australians confirmed that the deal with the French will go through.
More on the submarines
In a sign of thawing relations, US President Joe Biden called his French counterpart Emmanuel Macron to apologise over the issue and assure the French that they will be better consulted in the future. The White House and the Élysée Palace released a joint statement of the call.
And what about the UK?
Brussels observers are saying that the French were quite eager to “hit the UK under the belt”. Ever since Brexit, the relations between the two has turned sour. A rapprochement may be needed but with the UK out of the Union, relations between the two will always be discreetly suspicious.
The EU was negotiating a free trade agreement with Australia, and as the French Minister confirmed to Politico Playbook this week, they can forget it. The EU is no longer interested, maybe for now.
The two are expected to meet face-to-face at the end of October, while the French Ambassador, who was recalled to Paris last week, is set to return to his posting in the coming days.