Merkel hits EU in an election mood

BERLIN: A year ago, Angela Merkel emerged worse for the wear from a EU summit after the leaders of France, Italy and Spain forced German policy concessions on aid to struggling banks.

But not this time. With an eye on a looming election in September, the German chancellor returned to Brussels this week and reasserted her authority in Europe.

Aware that controversial decisions about closer European integration might disconcert her voters, or even fan support for a new anti-euro party in Germany, she ensured that debate on the next stage towards a European banking union was pushed back until the end of this year, after the vote.

This time around, there were no calls for Merkel to agree to steps like common debt issuance or a massive euro zone budget.

She made it clear that any form of German taxpayer liability for the debts of others – whether in a common bank resolution fund, a joint deposit guarantee or any form of common euro bonds – was strictly off the table.

Nor was there any mention of “austerity”, a buzzword that angers officials in Berlin because it links the German leader’s crisis management policies to the economic distress of southern Europe.

Instead, the summit gave Merkel a platform to recast her- self as a defender of the bloc’s downtrodden, with a muchhyped plan to combat soaring youth unemployment in Europe, worth € 6 billion (R78bn).

Merkel will host a summit on the same topic of jobless youth in Berlin next week, where most EU leaders present in Brussels will reconvene even though no one expects any decisions of substance there.

“Everyone is going easy on Merkel because we all know we’ll have to deal with her again after September,” said a senior adviser to one of the main European leaders, who requested anonymity due to the sensitivity of the issue.

Asked pointedly at a summit news conference whether election considerations were shaping her approach to Europe and putting EU decisions on hold, Merkel coolly dismissed the notion.

“I’m not aware of a single European decision that has been delayed because of the fact that we have an election in September,” she said, pointing to deals struck this week on the EU’s long- term budget and bank restructurings.

“Our government is working. This is very important for me. We are fully aware of Europe’s needs and the election is playing no role at all.”

A poll released showed Merkel’s conservative bloc with a crushing 17 point lead over the SPD with less than three months to go to the election.

The chances are good that she will either be able to form another centre-right coalition with her current partner, the liberal Free Democrats (FDP), or lead a “grand coalition” with the SPD, as she did in her first term between 2005 and 2009.

In the past week, she has blocked a European deal to enforce stricter rules on CO emissions for new cars, aware this could alienate Germany’s auto industry and the millions who depend on it for a living.

The chancellor has also hardened her line on Turkey, blocking EU plans this week to open a new chapter of accession talks with Istanbul in what many see as an attempt to appease conservative voters. – Reuters.