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Tag: Olaf Scholz

  • Germany’s far-right ‘firewall’ cracks

    Germany’s far-right ‘firewall’ cracks

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    BERLIN — The political maneuver shaking Germany’s postwar democratic order involves a piece of legislation that is about as mundane as it gets.

    Center-right legislators in the eastern German state of Thuringia wanted to cut a local property tax by a small amount — and did so with the support of the far-right Alternative for Germany, or AfD.

    The move broke with years of tradition in which mainstream parties have vowed to maintain a Brandmauer, or firewall, between themselves and the AfD, a party many in a country alert to the legacy of Nazism see as a dire threat to democracy. Even accepting the party’s support, the thinking goes, would legitimize far-right forces or make them salonfähig — socially acceptable.

    And so, when parliamentarians from the conservative Christian Democratic Union, or CDU, passed the tax reduction on a late afternoon in September with AfD votes, it sent tremors across the country’s political landscape that still are reverberating.

    “For me, a taboo has been broken,” Katrin Göring-Eckardt, a leader of the Greens who hails from Thuringia, said after the vote. “It shows me not only that the firewall is gone, but that there is open collaboration.”

    For mainstream parties, and the CDU in particular, the question of how to handle the growing presence of far-right radicals in governing bodies from federal and state parliaments to local councils is likely to grow only more vexing.

    That especially is the case in the states of the former East Germany, where the AfD now leads in polls at around 28 percent. Next year, the eastern states of Thuringia, Saxony and Brandenburg will all hold parliamentary elections. Polls show the party leading in all three states.

    The AfD is likely to expand its presence in the parliaments of Bavaria and Hesse when those states vote on Sunday. In Hesse, the AfD is coming close to overtaking German Chancellor Olaf Scholz’s center-left Social Democratic Party, according to the latest polls.

    The dilemma facing mainstream parties is clear. To work with the AfD means to normalize a party that many believe seeks to subvert the republic from within. But to ostracize the party only alienates its many voters.

    The firewall also serves as an unintended political gift, allowing the AfD to depict itself — at a time of high dissatisfaction with mainstream parties — as the clear choice for those who want to send a burn-it-down message to the country’s political establishment.

    At the same time, the controversy over the latest vote in Thuringia seems to have played into the AfD’s hands, allowing the party to depict itself as seeking to uphold rather than undermine democracy.

    The “‘firewall’ is history — and Thuringia is just the beginning,” AfD party leader Alice Weidel posted on X, formerly Twitter, after the vote. “It’s time to respond to the democratic will of citizens everywhere in Germany.”

    Historic fears

    Germany’s political leaders are all too aware that the Nazi seizure of power began with democratic electoral success. In fact, it was in Thuringia where, in 1930, the Nazi party first took real governing power in coalition with conservative parties.

    The “‘firewall’ is history — and Thuringia is just the beginning,” AfD party leader Alice Weidel posted on X, formerly Twitter, after the vote. “It’s time to respond to the democratic will of citizens everywhere in Germany” | Christof Stache/AFP via Getty Images

    That fact was not lost on the CDU’s opponents.

    “German conservatism has already been a stirrup holder of fascism,” Janine Wissler, a head of the Left party, told the German Press Agency after the vote. “Back then, too, it started in Thuringia,” she added. “Instead of having learned from that, the CDU is going down a path that’s as dangerous as fire.”

    CDU leaders in Thuringia deny the vote on the tax reduction means the firewall is crumbling. They say there was no cooperation with the AfD ahead of the vote (though AfD members say there were discussions between lawmakers).

    “I cannot make good, important decisions for the state that provide relief for families and the economy dependent on the fact that the wrong people might agree,” Mario Voigt, the head of the CDU in Thuringia said after the vote.

    Friedrich Merz, the national leader of the CDU, has sent mixed signals on the firewall — or at least on what exactly the firewall means. Merz says the CDU will not form coalitions with the AfD but he’s been less clear on whether the CDU will work with the party in other ways.

    In a television interview over the summer, he seemed to suggest working with the AfD on the local level was all but inevitable.

    Friedrich Merz, the national leader of the CDU, has sent mixed signals on the firewall | Tobias Schwarz/AFP via Getty Images

    “We are of course obliged to accept democratic elections,” he said. “And if a district administrator, a mayor is elected there who belongs to the AfD, it’s natural that you look for ways to then continue to work in this city.”

    After an uproar ensued, Merz walked back the comment. “There will be no cooperation between the CDU and the AfD at the municipal level either,” he posted on X, formerly Twitter.

    After the vote in Thuringia, Merz stood by the CDU leadership of the state. “We don’t go by who agrees, we go by what we think is right in the matter,” he said on German television.

    Even some within his own party do not see things that way. Daniel Günther, the CDU premier of the northern state of Schleswig-Holstein, sharply criticized his party colleagues in Thuringia. “As a conservative, I must be able to say plainly and simply the sentence, ‘I do not form majorities with extremists,’” Günther said.

    ‘Cordon sanitaire’

    It’s not the first time Thuringia has been at the center of a controversy over the firewall. In 2020, a little-known politician in the pro-business Free Democratic Party, Thomas Kemmerich, was elected state premier with the support of the CDU and AfD. Then-Chancellor Angela Merkel weighed in to call the vote “unforgivable.”

    In the furor that followed, Kemmerich resigned as did the then-head of the CDU faction in the state. But given the AfD’s large presence in the local parliament, the issue was bound to resurface.

    It’s not the first time Thuringia has been at the center of a controversy over the firewall | Christof Stache/AFP via Getty Images

    The problem is far from Germany’s alone. Mainstream parties are under growing pressure due to the rise of the radical right across Europe.

    In France, parties from across the political spectrum have formed a cordon sanitaire, or sanitary cordon, to keep Marine Le Pen, a leader of the far-right National Rally, out of the presidency. But with Le Pen’s party now the biggest opposition group in the National Assembly, the cordon is getting harder to maintain.

    In the European Parliament, where a similar cordon has been erected, the center-right European People’s Party has been openly courting the European Conservatives and Reformists, home to Poland’s nationalist Law and Justice party and Italian Prime Minister Giorgia Meloni’s far-right Brothers of Italy party.

    In Thuringia, the stakes are even higher as the local branch of the AfD contains some of the party’s most extreme members. State-level intelligence authorities tasked with surveilling anti-constitutional groups have characterized the party’s local branch as extremist.

    The leader of the AfD in Thuringia is Björn Höcke, who is set to face trial for using banned Nazi rhetoric. (In 2021, he closed a speech with the phrase “Alles für Deutschland!” or “Everything for Germany!” — a slogan used by Nazi stormtroopers.)

    Höcke railed against Holocaust remembrance in Germany and warned of “Volkstod,” the death of the Volk, through “population replacement.” For such views, German courts have ruled that Höcke could justifiably be referred to as a fascist or Nazi.

    GERMANY NATIONAL PARLIAMENT ELECTION POLL OF POLLS

    For more polling data from across Europe visit POLITICO Poll of Polls.

    After the vote on the property tax in Thuringia, Höcke clearly was pleased, claiming the AfD had helped enact a pragmatic policy.

    “It’s simply a good day for Thuringia,” he said.

    Peter Wilke contributed reporting.

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    James Angelos

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  • Intel’s Big Chip-Making Push in Germany Hits Bottleneck

    Intel’s Big Chip-Making Push in Germany Hits Bottleneck

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    Intel’s Big Chip-Making Push in Germany Hits Bottleneck

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  • Who are the G20’s bad guys now?

    Who are the G20’s bad guys now?

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    NEW DELHI — When world leaders gather at the G20 summit on Saturday morning, the smiles may be more awkward than usual. 

    While China’s Xi Jinping and Russia’s Vladimir Putin won’t be there, a B-list of strongmen with their own damning human rights records will be ready to embarrass the leaders of Western democracy with some stiff handshakes and fixed grins. 

    Some of these international bad guys also have played an increasingly assertive role in negotiations on the Ukraine war — interventions welcomed by the Ukrainian government. However unsavory their domestic records may be, that means they can’t be ignored.

    Take Saudi Arabia’s Mohammed bin Salman. According to U.S. intelligence, he approved the gruesome murder of journalist Jamal Khashoggi. But last month, he hosted a multinational meeting in Jeddah aimed at kick-starting peace talks. He’s also staying on after the G20 for a state visit in India.

    Turkey’s President Recep Tayyip Erdoğan, who has locked up thousands of political opponents and stifled media freedom, met Putin just this week in an effort to unblock grain shipments through the Red Sea. 

    One official involved in preparations for the summit in Delhi this week joked that the optics will be challenging. “No one wants that photo-op with MBS, let’s face it,” the official said. 

    But overall, Western diplomats are unapologetic about engaging with the bad boys of the G20 — reflecting a growing realization in Western capitals the battle to win minds on the Ukraine war is not working and needs buy-in from the countries beyond the affluent capitals of Europe and North America.

    “I’m not here to issue scorecards,” said U.S. National Security Adviser Jake Sullivan, when asked this week if President Biden was relaying U.S. concerns about Narendra Modi’s record on religious and press freedoms during his multiple meetings with the Indian leader. 

    Biden is expected to hold a meeting with MBS, with whom he shared an infamous fist-bump last year, a sign to many that all had been forgiven. 

    One European official involved in the preparations praised India for its work behind the scenes in trying to get consensus on an agreement rather than settling on different positions.  

    “If they succeed, it shows that the G20 has a future,” said the official, who was granted anonymity to speak openly due to the sensitive nature of the matter. 

    Ukraine remained the most divisive issue for G20 diplomats trying to hammer out a summit communique, with negotiations continuing late into Friday night.

    U.S. President Joe Biden is expected to hold a meeting with Saudi Arabia’s Mohammed bin Salman | Pool photo by Madel Ngan via AFP/Getty Images

    G7 countries — and the EU — are demanding that the principles enshrined in the U.N. Charter on territorial integrity and national sovereignty are reflected in the language.

    Also weighing on minds is the global economy. German Chancellor Olaf Scholz touches down in Delhi just as economic figures showed that industrial production in Europe’s economic powerhouse nose-dived again in July. 

    China is battling a slowing economy and a real-estate crisis. But it’s countries like India that are witnessing the kind of accelerated growth levels that suggest it is on the up.

    In New Delhi, giant posters of a smiling Modi, India’s prime minister, speckle the routes downtown. 

    This is India’s moment in the sun. Modi’s government has used its stint in the chair to show it can play a more assertive role in the global order. 

    India’s self-confidence as it hosts the global shindig signals a deeper geopolitical shift. 

    Three western officials with direct knowledge of the summit preparations said Brazil and South Africa, in particular, were playing a key role behind the scenes in coordination with India to get consensus on a final summit declaration, the holy grail of gatherings such as this. 

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    Suzanne Lynch

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  • Germany U-turns on commitment to meet NATO spending target annually

    Germany U-turns on commitment to meet NATO spending target annually

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    BERLIN — So much for Olaf Scholz’s Zeitenwende. 

    The German government on Wednesday stepped back at the last minute from making a legal commitment to meeting NATO’s target of spending 2 percent of GDP on defense on an annual basis, according to Reuters and German newspaper Süddeutsche Zeitung. 

    A government official told the news agency that a clause pledging to meet the target was deleted at short notice from Finance Minister Christian Lindner’s draft of a new budget financing law, just before the Cabinet passed it to the parliament.

    Instead, the government pledges to meet the 2 percent target on average over a five-year period, as already set out in the recently published National Security Strategy. 

    Annalena Baerbock’s Foreign Office had opposed setting the 2 percent target in law, as desired by the Defense Ministry, Süddeutsche Zeitung reported.

    A spokesperson for the government declined to comment to Reuters on the details of the bill.

    Following the Russian invasion of Ukraine, Chancellor Olaf Scholz announced the Zeitenwende, a new dawn in Germany’s security policy.

    “From now on, we will invest more than 2 percent of the GDP into our defense year after year,” Scholz said in February 2022. He renewed this promise after last month’s NATO summit in Vilnius. 

    For many years, Germany was criticized by NATO partners, especially the United States, for not sticking to NATO’s requirement on defense spending. 

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  • Germany has spent €55K on Merkel’s hair and makeup since she left office

    Germany has spent €55K on Merkel’s hair and makeup since she left office

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    The German government has splashed out almost €55,000 on former German Chancellor Angela Merkel’s hair and makeup since she left office in 2021.

    Despite departing Germany’s top job almost two years ago, Merkel is still billing the federal government for several expenses, according to documents obtained by Tagesspiegel via a Freedom of Information Act request.

    Merkel, according to a previous Tagesspiegel report, did not retain her longtime former makeup artist, but now relies on a new self-employed hair and makeup artist, who also works as a fashion designer, based in Berlin. The chancellery pays for Merkel’s hair and makeup for both public and private engagements. So far she has racked up a €17,200 bill in 2023, in addition to a €37,780 bill in 2022.

    “The assumption of costs is linked to the performance of continuing official duties — regardless of whether they are public or non-public,” the German chancellery told Tagesspiegel.

    Rising costs of officials’ hair and makeup services have sparked some criticism in the past, with The Taxpayers’ Association’s President Reiner Holznagel saying costs should be “reduced to the bare minimum and, in case of doubt, paid privately.”

    Current German Chancellor Olaf Scholz also does not spare expenses for his public outings, reported Tagesspiegel. So far this year, representatives of the chancellery have spent €21,808 on hairstyle and makeup expenses, while the number reached €39,910 in 2022.

    Numbers from a parliamentary inquiry earlier this year had shown that spending on photographers, hairdressers, and makeup artists rose to around €1.5 million in the first full year of Scholz’s government in 2022. That was nearly 80 percent more than in 2021, the last year of Merkel’s government.

    Last week, Bavaria’s state leader Markus Söder made headlines when it was reported that his office had splurged nearly €180,000 on freelance photographers in 2022 alone. This was in addition to €36,000 a year for a permanently employed photographer.

    The state chancellery said it hires photographers “on an occasion-related basis at an agreed hourly or daily rate … The images were for press and public relations purposes and for documentation.”

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    Claudia Chiappa

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  • Western powers race to finish security pledges for Ukraine

    Western powers race to finish security pledges for Ukraine

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    A small group of Western allies are engaged in “advanced” and “frantic, last-minute” negotiations to finalize a security assurance declaration for Ukraine ahead of this week’s NATO summit in Lithuania, according to four officials familiar with the talks.

    For weeks, the United States, the United Kingdom, France and Germany have been discussing the issue with Kyiv, and have also reached out to other allies in NATO, the EU and the G7. The idea is to create an “umbrella” for all countries willing to provide Ukraine with ongoing military aid, even if the details vary from country to country.

    The effort is part of broader negotiations at NATO and among several groups of nations over how Western allies should display long-term support for Ukraine. 

    Kyiv wants to join NATO as soon as possible, giving it access to the alliance’s vaunted Article 5 clause — an attack on one is an attack on all. But many allies within the alliance broadly agree Ukraine can only join after the war ends, at the earliest. 

    So the alliance’s biggest powers have been working to see what stop-gap security commitments they can each give Ukraine in the meantime. That view is not universal, however, with countries along NATO’s eastern flank pushing for Ukraine to get a quicker path to ascension, even as the fighting rages on. 

    The Western powers’ goal is to unveil their umbrella framework around NATO’s annual summit, according to officials in Berlin, Paris, London and Brussels, all of whom spoke under the condition of anonymity due to the sensitivity of the discussions. The two-day event starts Tuesday in Vilnius.

    “A discussion is under way; it’s quite advanced, in fact it’s very advanced, and we’re very hopeful that it can be concluded by the end of the summit,” a French official told reporters at a briefing. 

    A senior NATO diplomat agreed, telling reporters in a separate briefing there are “frantic last-minute negotiations” occurring at the moment “on what this should look like.” 

    Last-minute details

    U.S. President Joe Biden is slated to meet with U.K. Prime Minister Rishi Sunak on Monday in London, where their two staffs will huddle to try and iron out last-minute details, according to a second NATO diplomat with knowledge of the plans. On the U.S. side, Pentagon policy chief Colin Kahl is tasked with getting the agreement to the finish line.

    The initiative may ultimately amount to promises to continue much of the aid allies are already providing: arms, equipment, training, financing and intelligence. But the intent is to offer a more-permanent signal of unity for Ukraine, especially as Kyiv is unlikely to get the firm pledge on NATO membership it wants at this week’s summit.

    “It is basically a guarantee towards Ukraine that we will, for a very long time to come, we will equip their armed forces, we will finance them, we will advise them, we will train them in order for them to have a deterrent force against any future aggression,” the senior NATO diplomat said. 

    Many specifics of this support would be left for later, however. The diplomat said it would be up to each interested country to bilaterally determine with Ukraine “what your commitment will be. And it could be anything, from air defense to tanks to whatever.”

    Last week, German Chancellor Olaf Scholz issued an “appeal to all countries that want to support Ukraine,” saying they should “make decisions for themselves that enable them to continue to keep up that support for one, two, three, and, if need be, more years, because we do not know how long the military conflict will last.”

    German Chancellor Olaf Scholz | Pool photo by Kai Pfaffenbach/AFP via Getty Images

    Separate from the security assurance declaration that Western powers are finalizing, NATO is also drawing up new ways to aid Ukraine’s military for years to come. 

    At the summit, NATO will agree on plans to help modernize Ukraine’s defenses, alliance chief Jens Stoltenberg told reporters on Friday. The plan, he said, will involve “a multi-year program of assistance to ensure full interoperability between the Ukrainian armed forces and NATO.”

    That multi-year effort will also focus on Ukrainian military modernization programs, and like the “umbrella” initiative, will depend on individual countries contributing what they see fit.

    NATO aspirations

    NATO leaders will also create a new NATO-Ukraine forum, giving the two sides a space to work on “practical joint activities,” Stoltenberg added. 

    The broader security assurance conversation has inevitably become intertwined with the debate around Ukraine’s NATO aspirations, which will be high on the agenda when leaders gather in Vilnius.

    In the formal communiqué that will be issued during the summit, “we will be addressing Ukraine’s membership aspirations and that is something that NATO allies continue to work on,” U.S. Ambassador to NATO Julianne Smith told reporters on Friday.

    Specifically, leaders are aiming to update the alliance’s vague 2008 promise that Ukraine “will become” a NATO member at some point. But they aren’t expected to offer Kyiv the “clear invitation” that Ukrainian leader Volodymyr Zelenskyy is seeking.

    Scholz conceded as much last week. 

    “Certainly, we will also discuss the question of how to continue to deal with the perspective of the countries that look to NATO and want to join it,” Scholz said. Yet, he added, “it is also clear that no one can become a member of a defense alliance during a war.”

    Stoltenberg nonetheless struck an upbeat tone on Friday.

    “I’m confident that we’ll have a message which is clear,” he said. “We have to remember that Allies also agree already on a lot of important principles when it comes to Ukraine and membership.”

    Jacopo Barigazzi contributed reporting.

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    Hans von der Burchard, Paul McLeary and Laura Kayali

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  • Kyiv not in NATO after Russia war would be ‘suicidal,’ Ukraine foreign minister says

    Kyiv not in NATO after Russia war would be ‘suicidal,’ Ukraine foreign minister says

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    Paul Ronzheimer is the deputy editor-in-chief of BILD and a senior journalist reporting for Axel Springer, the parent company of POLITICO.

    Ukrainian Foreign Minister Dmytro Kuleba warned European allies that it would be “suicidal” not to accept Ukraine into NATO after the war with Russia is over.

    Kuleba’s comments come ahead of a NATO summit in mid-July when Kyiv’s membership bid is set to be the most politically sensitive point of discussion. Ukraine is looking to get a commitment from the defense alliance on its NATO aspirations, but a number of allies say a serious discussion on Ukraine in NATO can happen only after Russian forces are no longer on its territory.

    German Chancellor Olaf Scholz said on June 22 that the NATO summit in Vilnius on July 11-12 should focus on strengthening Ukraine’s military power instead of opening a process for Kyiv to join the transatlantic alliance.

    “After the war ends, it will be suicidal for Europe not to accept Ukraine into NATO because it will mean that the option of … war will remain open,” Kuleba told Axel Springer, POLITICO’s parent company, in an interview on Friday in Kyiv.

    “The only way to shut the door for the Russian aggression against Europe and Euro Atlantic space as a whole is to take Ukraine in NATO, because Russia will not dare to repeat this experience again,” Kuleba said.

    Ukrainian President Volodymyr Zelenskyy has a vision for Ukraine to join NATO, as well as the EU, once Kyiv has repelled Russian President Vladimir Putin’s invasion. Ukrainian Ambassador to NATO Natalia Galibarenko told POLITICO in late June that Kyiv is seeking “some kind of invitation — or at least commitment … to look at the timeframe and modalities of our membership” at the Vilnius summit.

    Kuleba in the interview pushed back on Germany and others advocating against such a commitment, warning against an outcome similar to the 2008 NATO summit in Bucharest, when Berlin and Paris rejected NATO membership for Ukraine and Georgia.

    “Do not repeat the mistake Chancellor Merkel made in Bucharest in 2008 when she fiercely opposed any progress towards Ukraine’s NATO membership,” he said.

    “This decision opened the door for Putin to invade Georgia and then to continue his destabilizing efforts in the region, and then eventually illegally annexing Crimea,” Kuleba said. “Because if Ukraine was accepted in NATO by 2014, there would not [have been] the illegal annexation of Crimea. It would not be war in Donbas, there would not be this large-scale invasion,” he said.

    Kuleba rejected statements by Hungarian Prime Minister Viktor Orbán that it will be “impossible” for Ukraine to win against Russia, saying he is “tired of countering all these meaningless arguments.”

    “It’s all just blah blah blah,” Kuleba said.

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    Paul Ronzheimer

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  • Migration money feud infiltrates EU summit

    Migration money feud infiltrates EU summit

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    BRUSSELS — EU countries are bickering over granting billions in new funds to deal with migration as asylum applications soar and backlogs pile up at the Continent’s borders. 

    Germany, which received a quarter of all EU asylum applications in 2022, specifically wants to “revitalize” the EU’s ties with neighboring Turkey, according to a senior German official — a nod to the last time the bloc faced such levels of migration. 

    Then, in 2016, the EU offered Turkey billions in exchange for the country housing thousands of Syrian refugees fleeing civil war. Now, there is a push to authorize up to €10.5 billion in new money for not just Turkey, but also countries like Libya or Tunisia, hoping it would help them prevent people from entering the EU without permission. 

    The debate has jumped onto the agenda of an EU leaders’ summit in Brussels on Thursday and Friday. And countries are sparring over whether to reference a monetary request in the meeting’s final conclusions, according to five diplomats and officials from four different countries. 

    The behind-the-scenes fight illustrates how much migration has come to dominate the political agenda. Organizers for the summit had hoped to keep the divisive migration talk to a minimum in favor of discussions on Russia, China and economic security. But with high-profile disasters like the recent migrant shipwreck near Greece and arrival figures continuing their steep climb, the heated issue is becoming increasingly hard to avoid. 

    Notably, draft conclusions for the summit, dated Wednesday evening and seen by POLITICO, still had two indirect references to the fresh migration funds: The €10.5 billion pot and another €2 billion for “managing migration” within the EU’s own borders. 

    Whether that language survives until Friday is another question. 

    Germany: Let’s talk Turkey, not money

    Germany, as always, is one of the key players in the debate — and in this instance, it is making arguments for both sides.

    On one side, Berlin wants to renew the EU’s relationship with Turkey, hoping it can take in more asylum seekers and help cut down on unauthorized border crossings. In return, the Germans want the EU to improve trade ties with the country. 

    On the other side, however, Berlin is fiercely opposing the attempt to explicitly mention money in the summit conclusions. The logic: Committing to fresh billions now would imperil upcoming talks over whether to add €66 billion to its budget. Germany wants to discuss the whole package at once, instead of approving parts of it in advance.

    As of Wednesday night, the summit conclusions draft still contained an indirect endorsement of the money.

    Germany, as always, is one of the key players in the debate — and in this instance, it is making arguments for both sides | David Gannon/AFP via Getty Images

    The document mentions “financing mechanisms” — seen as a reference to the €10.5 billion — for “the external aspects of migration.” That money would go to countries like Turkey, Libya and Tunisia, which migrants often traverse on their way to Europe. 

    There’s also an indirect reference to the €2 billion for internal EU migration management. The text calls for “support for displaced persons,” particularly from Ukraine, via “adequate and flexible financial assistance to the member states who carry the largest burden of medical, education and living costs of refugees.” Translated, that would mean more money for countries that host the bulk of Ukrainian refugees, like Poland and Germany. 

    Yet during a meeting of EU ambassadors on Wednesday, German officials urged their counterparts to cut or massively reduce both passages, according to the five diplomats and officials, who, like other officials in this story, were granted anonymity because they are not allowed to publicly discuss the talks.

    As of Wednesday night, that appeal had failed. But German Chancellor Olaf Scholz may take up the issue himself with his counterparts on Thursday.

    The German argument is that including the figures would mean EU leaders are essentially making a big step toward endorsing the full budget package — which the European Commission requested just last week — before even discussing it, two of the officials said. 

    Nevertheless, Commission President Ursula von der Leyen is expected to briefly present her €66 billion budget plan during the gathering of EU leaders on Thursday, meaning there will likely be an initial debate about the money, the officials said. 

    Von der Leyen’s plans are expected to run into resistance from a number of countries, particularly the so-called “frugal” countries, including Austria, Denmark, the Netherlands and Sweden.

    Speaking to a briefing for reporters in Berlin on Wednesday, a senior German official also voiced caution about von der Leyen’s plan.

    “One of the questions is: Is the Commission’s assessment of the situation convincing?” said the senior official, who could not be named due to the rules under which the briefing was organized.

    Time to work with Erdoğan again? 

    At the same time, the senior German official stressed Berlin’s interest in renewing the EU relationship with Turkey.

    “[Turkish President Recep Tayyip] Erdoğan has been re-elected, and this must be an opportunity for the EU to take another broad look at its relationship with Turkey,” the official said. 

    Turkish President Recep Tayyip Erdoğan | Adem Altan/AFP via Getty Images

    “For us, it’s a matter of putting EU-Turkey relations once again on the agenda … to possibly revitalize them, if all sides want to commit to this,” the official continued, adding that the European Commission and EU foreign policy chief Josep Borrell should “come back in the fall with proposals.”

    One idea could be an update of the EU’s trade rules with Turkey — a thorny issue, though, as talks between Brussels and Ankara have failed to make progress on modernizing the so-called EU-Turkey customs union for several years.

    Germany’s Scholz held a phone call with Erdoğan on Wednesday during which both leaders discussed how “to cooperate further and deepen exchanges on various cooperation issues,” according to Steffen Hebestreit, Scholz’s spokesperson. 

    Any progress in EU-Turkey relations would also require the agreement of the EU countries perpetually at odds with Turkey — Greece and Cyprus.

    At least in that sense, there seems to be progress: “We agreed to include a paragraph on Turkey and the future relations,” a Greek diplomat said.

    The latest draft conclusions from Wednesday evening ask Borrell and the Commission “submit a report” on EU-Turkey relations “with a view to proceeding in a strategic and forward-looking manner.”

    Barbara Moens, Jakob Hanke Vela, Lili Bayer, Jacopo Barigazzi and Gregorio Sorgi contributed reporting.

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    Hans von der Burchard

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  • What genocide? Volkswagen’s morally expensive bet on China

    What genocide? Volkswagen’s morally expensive bet on China

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    BERLIN — The blowback came in the form of cake.

    An annual meeting of Volkswagen shareholders in Berlin in May was disrupted by protesters, one of whom hurled the creamy confection at the assembled executives, forcing Chairman Hans Dieter Pötsch to flinch out of the way.

    Among the subjects of their ire: A car plant some 3,500 miles away in the Chinese region of Xinjiang, where Beijing has carried out a campaign of mass detention, reeducation and forced labor that the United States has described as genocide of the Uyghur ethnic minority.

    One topless woman in the room waved a banner with the words “End Uyghur Forced Labor” before the protesters were escorted away. Outside, other activists held up signs saying “Camps, forced labor, family separations: VW major shareholders in Lower Saxony must not remain silent about crimes against Uyghurs.”

    Volkswagen denies it has ever utilized forced labor in Xinjiang. But it has been less willing to grapple with the broader accusation: That by maintaining the facility at the request of Beijing, the company — and by extension the German government, which supported the carmaker’s investments in China — is providing political cover for crimes against humanity.

    “Even if there is no forced labor, it is such a big symbol for the Chinese government to show the world that they bring prosperity to the region,” said Eva Stocker, senior project officer from the World Uyghur Congress, an advocacy group for Uyghur rights and self-determination. “But we see it as a genocide.”

    The rising criticism over Volkswagen’s presence in Xinjiang has been accompanied by a shifting in the political and economic winds. Russia’s war on Ukraine has kicked off a broader conversation about strategic dependency, with officials in Brussels and Washington calling for “de-risking” with regard to Beijing. At the same time, worries about climate change are upending the automobile market, with Chinese electric carmakers preparing to challenge legacy brands in Europe on their own soil.

    This all poses a conundrum for Volkswagen, which led the Western charge into the Chinese market in the 1980s and remains dependent on business there for 15 percent of its pretax profit and 37 percent of its new car sales last year.

    China’s treatment of Uyghurs is unlikely to be central to the discussions as German Chancellor Olaf Scholz hosts a Chinese delegation led by Prime Minister Li Qiang this week. But Volkswagen’s relationship to China, and the human rights abuses being carried out there, is illustrative of Berlin’s increasingly uncomfortable dependency on Beijing — and the challenges Germany is likely to face as the West seeks to turn de-risking from a slogan into action.

    Slave labor

    Potential complicity in genocide is a charge to which one might expect Volkswagen to be sensitive. When the company was founded in 1937 by the national labor organization of the Nazi Party, it used concentration camp prisoners as slave labor. Hundreds of infants kept at a children’s home run by Volkswagen were starved to death.

    During the Holocaust, the Nazis sent their perceived enemies to extermination camps. In Xinjiang, human rights groups have documented mass incarceration, forced sterilization, the suppression of religious practices, including the burning of mosques, and the separation of hundreds of thousands of schoolchildren from their parents. Many believe these practices meet the definition of genocide as acts intended “to destroy, in whole or in part, a national, ethnic, racial or religious group.”

    The United States government has denounced human rights abuses in Xinjiang as genocide, as have national legislatures in France, the Netherlands, the United Kingdom, Lithuania and Canada. The German Bundestag has not, though Foreign Minister Annalena Baerbock has called for a ban on goods made with forced labor and for investigations into China’s actions in Xinjiang.

    Volkswagen denies it has ever utilized forced labor in Xinjiang | Freddy Chan/EPA via EFE

    Investigative journalists have found traces of forced labor camps within 15 miles of Volkswagen’s Xinjiang plant, which is a joint venture initiative with SAIC Motor, the largest state-owned automobile manufacturer in China. As POLITICO and other media reported, the use of forced labor was so rampant in the region that schoolchildren were organized by schools to carry out manual labor.

    “By the plant, there are seven concentration camps … so this is what Volkswagen cannot deny, but they say they are not connected with them,” Erkin Zunun, the chief coordinator of the World Uyghur Congress based in Munich, said. “Nobody can say 100 percent there is no connection to forced labor.”

    Ralf Brandstätter, the head of Volkswagen’s China operations, said after a visit to the Xinjiang plant in March that he’d found no evidence of forced labor. “I can talk to people and draw my conclusions. I can try and verify the facts [from joint venture partner SAIC], and that’s what I did,” Brandstätter said. “I didn’t find any contradictions,” he added, citing seven staffers he’d spoken to via translators.

    Over the past few years, European diplomats based in China have made repeated inquiries into Volkswagen’s presence in Xinjiang, according to three diplomats granted anonymity to speak frankly about their exchanges. Time and again, they received the same answer. “They always insist there’s no forced labor, and that the minorities they hire in the local plant are not forced labor,” one of them said. “They don’t care what happens outside the factory.”

    Volkswagen rejected the accusation that by being in Xinjiang, the company is complicit in the human rights violations being perpetrated there. “Will something change if Volkswagen leaves?” said a Volkswagen spokesperson speaking on condition of anonymity. “We have doubts about this.”

    The spokesperson said the company pays its employees at the plant on average 30 percent more than other automakers in the region and has had practically no staff turnover in recent years. “We are offering around 250 workers and their families a good … living in the region,” the spokesperson said.

    ‘Devil’s agreement’

    On its own, Volkswagen’s investment in Xinjiang — and the company’s decision to stay there despite human rights violations in the area — makes little reputational or economic sense.

    Since the COVID shutdowns, the plant hasn’t been used for vehicle assembly or production, but rather as a sorting center for cars heading to local dealerships. Last year, Volkswagen says some 10,000 cars — an average of less than 28 a day — were cleared through the facility, with plans to increase this over the next few years. Staff at the site carry out water resistance checks, quality controls and assess driver assistance systems, a spokesperson said.

    The investment has to be considered in the broader context of Volkswagen’s engagement with Beijing. Unrestricted access to the Chinese market is mission-critical for all German automakers, but for Volkswagen, it’s what makes it a global heavyweight brand. Nearly 40 percent of Volkswagen’s global car sales were in China last year, up from 31 percent a decade ago, according to data from the Center for Automotive Management in Cologne.

    According to a senior Western diplomat, Volkswagen’s Xinjiang presence is part of a “devil’s agreement” that the Chinese government imposed on the German car company 15 years ago. Under the deal, Volkswagen had to agree to build a new factory in Xinjiang — which was and has remained an economic backwater — in return for permission for a dozen new plants in the economically vibrant eastern coastal area, as well as the booming central provinces.

    “The misleading assumption is that we were forced, that we opened the plant as a push from the government in Beijing,” said the Volkswagen spokesperson. “That isn’t true. It was part of a greater plan — the Go West strategy,” referring to the company’s ambitions to expand into less developed parts of China.

    Today, pulling out would risk jeopardizing relations with Beijing, as China often treats expressions of concern about human rights violations in Xinjiang as endorsements of what it sees as U.S. pressure on the country.

    The presentation of the new Golf GTI at the Shanghai car show in 2021 | Hector Retamal/AFP via Getty Images

    Volkswagen is determined to live with its contractual obligation with SAIC to stay in Xinjiang at least until 2030, Volkswagen chief lobbyist Thomas Steg told journalists in March. “This plant is owned and operated by a non-controlled joint venture, all the decisions have to be taken unanimously,” the company spokesperson said.

    In a written statement, Volkswagen Group said it “stands firmly against” forced labor, adding it “takes its responsibility for human rights very seriously in all regions of the world, including China.”

    “In a globalized world, we can only really strengthen Germany as a business location if we maintain and further develop our relations with major economic players such as China,” it said.

    Green evolution

    While Volkswagen has traditionally enjoyed strong support from Berlin for its investments in China, the political winds back home have started to shift.

    The main push comes from the Green Party, a junior partner in Germany’s coalition government, and its calls for “values-driven” diplomacy. In May 2022, the German Economy Ministry, led by Green Party heavyweight Robert Habeck, announced it would stop all investment guarantee schemes for companies looking to invest in the Xinjiang region of China due to the deteriorating human rights situation.

    Volkswagen’s investment guarantees were not extended because the interministerial committee that decides on them determined that the company “has too little control and knowledge … within the joint venture to adequately counter the human rights risks,” a German official said.

    Chinese carmakers with cheaper battery technology are making a play for Europe | Tobias Schwarz/AFP via Getty Images

    Foreign Minister Baerbock has also taken a tougher line, warning companies that they won’t be bailed out with taxpayers’ money if “things go wrong” in other parts of the world. Her stance has not gone unnoticed by Beijing. When Baerbock visited China in April, her counterpart Qin Gang warned Berlin it should be thinking about its business interests.

    “Both sides should maintain and advance existing cooperation, create a favorable environment and stable expectations for cooperation between enterprises of the two countries, and provide stronger growth drivers for the global economy,” Qin said.

    Germany’s first National Security Strategy, released last week, criticizes China for disregarding human rights, although the document does not go further into detail. Berlin also plans to release a dedicated China strategy in July.

    For the automaker, the Green Party’s China policy has become a headache. “It’s crazy what Habeck and Baerbock are doing at the moment … [They] just try to bring confrontation to the world,” said Ferdinand Dudenhöffer, director of Center for Automotive Research, an industry group with close ties to Volkswagen and to Chinese carmakers. “It’s really crazy.”

    Dudenhöffer insisted the German carmaker had done everything within its capacity to ensure good labor standards in the Xinjiang plant. He didn’t believe the company had broached with Beijing the possibility of the plant’s closure or the transfer of its ownership to its Chinese partners. “I think they discussed it internally, but … if you start to talk about that issue [with the Chinese], then you start to go into opposition with the most important market you have in the world,” he said.

    The EV threat

    The irony is that Volkswagen’s morally expensive bet may not even pay off.

    After enjoying decades of market leadership, the German auto giant is struggling to cope with the impending demise of the combustion engine and is facing unprecedented challenges from Chinese-made electric vehicles, which are now set to become the “greatest risk” facing European carmakers, according to a report by Allianz Trade.

    Even as Volkswagen doubles down on the Chinese market, Chinese carmakers with cheaper battery technology are making a play for Europe, with brands like BYD, Great Wall, Nio and Xpeng launching across the Continent.

    While electric vehicles only make up around 5 percent of European sales, EU regulators have mandated a phaseout of the combustion engine by 2035. One analysis predicts Chinese imports could make up nearly a fifth of all European sales by 2025 — bad news for local legacy brands.

    Even if Volkswagen does find a way to hold out at home, its investments in China could be at risk if Europe raises trade barriers against Chinese vehicles, as France has been calling for. Such a move would almost certainly lead to reciprocal action from Beijing, which has not shied away from using its regulatory muscles to push its diplomatic interests.

    In 2017, for example, when South Korea sought to buy a missile defense system from the U.S. in order to stave off the threat from North Korea, Beijing vocally opposed the move, and sales of Hyundai and Kia models subsequently plummeted, sparking rows with dealerships and plant closures.

    Under President Xi Jinping, China has also sought to diminish the market share of foreign companies. In telecoms, for example, European players like Ericsson and Nokia have been crowded out by homegrown heavyweights Huawei and ZTE. China may have needed Western companies to jump-start its industrial development, but with Xi seeking to present China as an alternative to the West, that utility is quickly fading.

    In other words, for Volkswagen’s executives, cake-throwing protesters may be the least of their worries.

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    Stuart Lau , Joshua Posaner and Hans von der Burchard

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  • Build better ties instead of only asking for microchips, Taiwan tells Europe

    Build better ties instead of only asking for microchips, Taiwan tells Europe

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    Europe cannot ignore Taiwan’s desire for “better relations” if EU countries such as Germany are keen to acquire advanced microchip-making technologies from the island, Taiwanese Foreign Minister Joseph Wu said.

    Speaking to POLITICO and other media on his trip to Europe, Wu questioned the enticements Europe is offering TSMC when asked why the world-leading chipmaking giant based in Taiwan has still not come to a decision to build a new plant in Germany.

    “If Europe has provided very positive incentive, and also speak with the TSMC in a way that will make the TSMC feel comfortable, that their investment in Europe is going to produce very positive results … their investment in Europe is certainly not going to be stopped by the government,” Wu said.

    “Even though we are not selfish in stopping the TSMC, for making investment in other countries, we certainly hope that other countries who want to attract TSMC to make investment can also think about the situation Taiwan is in, or TSMC’s position in Taiwan, and the position Taiwan is seeing in this geo-strategical landscape,” he said.

    In contrast, Wu called Japan and the U.S. — where TSMC plants will be completed next year — a “like-minded partner” and “a very good partner of Taiwan,” respectively.

    “I think this is some philosophical thinking, rather than government policy of putting conditions on TSMC making investment in other [countries],” Wu said. “That philosophical issue is that when a country is in shortage of computer chips, they will ask Taiwan, ‘you should do this, and you should do that’ — but they don’t seem to be thinking about a broader picture of better relations with Taiwan, economic or otherwise.”

    Wu’s comments are a pointed though veiled criticism aimed at Germany.

    At the height of the coronavirus pandemic in 2021, then-German Economy Minister Peter Altmaier asked his Taiwanese counterpart, Wang Mei-hua, to intervene regarding TSMC’s reduced supply to the German auto industry, according to a letter reported by Reuters. “I would be pleased if you could take on this matter and underline the importance of additional semiconductor capacities for the German automotive industry to TSMC,” said the letter written by Altmaier, who was a key member of Angela Merkel’s government which put a priority on trade with China.

    Deterring China

    One of Wu’s main missions in Europe — in a trip that took him to Prague, Brussels and Milan — was to shore up diplomatic support for Taiwan among European leaders.

    He welcomed the EU’s repeated calls on Beijing to maintain the status quo in the Taiwan Strait. “China might also sense that it might come down with some economic price for their possible aggression against Taiwan, so sanction or other types of economic means against China, and I think the European countries have been discussing about that as well,” he said.

    Even if the EU has taken a more critical view of China as a result of the coronavirus pandemic, which began in China, as well as Beijing’s stance on Russia’s war against Ukraine, Taiwan still faces challenges while engaging with Europe.

    On trade, the European Commission has been reluctant to begin negotiations for a bilateral investment agreement (BIA) with Taiwan, apparently out of concern about retaliation from Beijing.

    Taiwanese Foreign Minister Joseph Wu traveled to Europe to shore up diplomatic support from European leaders | Vladimir Simicek/AFP via Getty Images

    “We are very concerned that the BIA between Taiwan and EU seems to be called as a hostage to the stalling CAI negotiations,” Wu said, referring to the comprehensive agreement on investment between the EU and China. “But if you look at the linkage — close linkage — between Taiwan and the EU, in economic sense, I think EU needs to find an alternative to strengthen the bilateral economic or trade relations, rather than get bogged down by the CAI which is not going anywhere,” he said.

    “We hope we can persuade the EU leadership to think about this in a positive way,” Wu added.

    Due to diplomatic protocol under which all EU member countries recognize the “one China” policy, the Taiwanese officials requested that POLITICO and the other media not disclose the location where the interview was conducted. Nor could Wu say which EU officials he met with, or whether he planned to have meetings at NATO, also based in Brussels. (One of the few EU figures confirming Wu’s presence in Brussels was European Parliament Vice President Nicola Beer, who tweeted about their meeting and called Taiwan a “firm member of the democratic family.”)

    Despite the EU’s lack of public acknowledgment of his visit — as well as the European public’s preference of “staying neutral” in the event of a U.S.-China conflict over Taiwan — Wu still has high hopes that the bloc’s attitude would change.

    “I don’t think morally, any sensible country, any sensible leader can stay neutral and say, ‘No, we’re not going to pay any attention to [the] atrocity,'” he said, referring to potential Chinese invasion of Taiwan.

    “And I think the same can apply to the situation between the U.S. and China. If China initiated any aggression against other countries, in killing innocent people, violating international laws, causing atrocities and destructions, and killing innocent people, and all that, and the United States is trying to help, I don’t think the European countries can say that it’s a matter … between the U.S. and China,” Wu said.

    “When the international community discuss about the major international principles,” he said, “I think it’s going to be very hard for Europe to say that ‘I don’t care’.”

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    Stuart Lau

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  • Macron warns Ukraine counteroffensive could last ‘weeks, even months’

    Macron warns Ukraine counteroffensive could last ‘weeks, even months’

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    PARIS — French President Emmanuel Macron warned on Monday that the Ukrainian counteroffensive against Russian forces could last “weeks, even months.”

    “The counteroffensive has started. It’s going to be deployed for several weeks and even months. We are supporting it within the limits that we set ourselves,” Macron said alongside German Chancellor Olaf Scholz and Polish President Andrzej Duda at the Elysée Palace.

    Ukrainian forces have stepped up operations in the last couple of days and announced on Monday evening that they had liberated several villages in the south and the east of the country.  

    “We want [the counteroffensive] to be as victorious as possible so that we can then start a period of negotiations in good conditions,” he added.

    The French, Polish and German leaders were meeting in Paris to discuss Ukraine’s request for security guarantees and a clear pathway to NATO membership ahead of a summit of the military alliance in July. However, on Monday evening it appeared that the leaders were sending different signals in a press conference that was held ahead of a working dinner in Paris.

    While Duda called for Ukraine to be given “a clear signal, a clear perspective” on its future membership of NATO, Scholz was less forthcoming, noting that debates were “intense.”

    “We have been discussing security guarantees since the start of the war … We have taken decisions to support Ukraine for as long as needed. This debate is intense between us, between Germany, France, and its U.S. partners,” Scholz said. “We will finalize [our position] when we have the results of our talks. But … it must be very concrete.”

    Earlier this month, Macron called for Ukraine to be given “strong and tangible” security guarantees but stopped short of calling for full-fledged NATO membership.

    Macron, Scholz and Duda all pledged that their countries would continue supporting Ukraine during the counteroffensive. Scholz told reporters that Germany would support Ukraine for “as long as necessary” and said his country had also set up systems to repair weapons during the current assault.

    Macron meanwhile said that France had “intensified deliveries” of weapons, ammunition and armored vehicles.

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    Clea Caulcutt

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  • Europe gathered in unity for Ukraine. Zelenskyy’s plea exposed its divisions

    Europe gathered in unity for Ukraine. Zelenskyy’s plea exposed its divisions

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    BULBOACA, Moldova — European leaders mounted a powerful show of defiance — and support for Ukraine — as they gathered Thursday for a historic summit in the ex-Soviet country of Moldova just kilometers from the Ukrainian border.

    But even as over 40 leaders pledged their solidarity with Ukraine at the second gathering of the so-called European Political Community, the difficulty in maintaining that unity was on display. Before and during the summit, leaders hedged and staked out competing positions on an increasingly contentious issue — what security guarantees the Western alliance can give Kyiv to ensure that if Russia is ever pushed out, it won’t return.

    French President Emmanuel Macron set the tone on Wednesday, imploring allies to offer Kyiv “tangible and credible” security guarantees — a shift in the French position. His German counterpart, Olaf Scholz, was more hesitant on Thursday, declining to provide any details and indicating it might be a question for after the war.

    Against this backdrop, Ukraine’s own leader, Volodymyr Zelenskyy, joined the leaders in a surprise appearance. Under a crisp blue sky, Zelenskyy made two explicit demands: One, a “clear invitation” to join NATO — another subject that divides allies — and “security guarantees on the way to NATO membership.”

    Both, he said, “are needed.”

    The divergent positions illustrate the fraught questions that lie ahead as the West strives to hold together against Russia and the war grinds on. Yet, for now, unity is still the predominant rhetorical theme when European leaders gather.

    “Today’s summit showed us how valuable the European Political Community is,” Moldovan President Maia Sandu said as the summit drew to a close. “We have shown that we are a family, a strong and united family of European nations acting together to make the continent stronger — more united and more peaceful.”

    Zelenskyy’s plea 

    The summit at Castle Mimi, a vineyard only 20 kilometers from the Ukrainian border, kicked off on an emotional note with Zelenskyy’s arrival.

    Sandu welcomed the Ukrainian president ahead of the other leaders, thanking him profusely for “keeping Moldova safe.” The side-by-side image of the two leaders, whose countries have both been battling Russian aggression to various degrees, was a powerful symbol.

    But with Kyiv under an intensifying hail of Russia’s bombs, Zelenskyy moved swiftly to his plea, asking allies to give Ukraine firm security guarantees and a commitment to NATO membership at an upcoming NATO summit in Lithuania. NATO agreed in 2008 that Ukraine would eventually become a member, but it has never offered a firm promise or timeline.

    While Zelenskyy is unlikely to get everything he wants at the July gathering, both issues are being hotly debated at the moment. 

    Macron set the stage on Wednesday when he turned heads with his most forthcoming remarks yet about security guarantees.

    “I’m in favor — and it will be the topic of collective discussions in the coming weeks — of giving tangible and credible security guarantees for two reasons: Ukraine protects Europe today and she gives Europe security guarantees,” he said. 

    Volodymyr Zelenskyy joined the leaders in a surprise appearance | Daniel Mihailescu/AFP via Getty Images

    But on Thursday, Scholz, the German chancellor, was more guarded. 

    “One thing is very clear: We are now making our contribution to supporting Ukraine,” he said. “We have always said that there must also be guarantees for a peace order after the war. Germany will make a contribution to this.”

    Scholz then refused to be drawn into the details of the discussion, even as it moved to center stage.

    Still, both Scholz and Macron confirmed that allies are actively discussing the subject, and working to coordinate their approaches ahead of the NATO summit. 

    Speaking in Oslo on Thursday, NATO Secretary-General Jens Stoltenberg was similarly careful when addressing the touchy subject.

    “When the war ends, we need to ensure that history doesn’t repeat itself, that this pattern of Russian aggression against Ukraine really stops and therefore, we need to have in place frameworks to provide guarantees for Ukrainian security after the end of the war, so history doesn’t repeat itself,” he said.

    Leaders pose for the family photo at the European Political Community summit | Ludovic Marin/AFP via Getty Images

    The lack of clarity reflects the complexity of offering — or even defining — “security guarantees” for another country. Europe may also be waiting to take its cue from the U.S. One option on the table may reflect the security model binding the U.S. and Israel, which prioritizes arms transfers and long-term support commitments. 

    Nonetheless, Scholz, speaking at the conclusion of the summit, was keen to stress that helping Ukraine defend itself was “the task at hand.” And he ruled out NATO membership for Ukraine at this juncture.

    “There are clear criteria for membership. You can’t have border conflicts for instance,” he said — an obvious reference to Ukraine. 

    Scholz’s remarks reflect the broad understanding that Ukraine cannot join NATO so long as it’s actively at war with Russia. But Ukrainian officials want NATO leaders to offer a concrete political gesture that Kyiv is at least on the membership path.

    Some NATO allies are willing to be far blunter than Scholz on the subject, most notably those representing the Baltic countries, highlighting yet another fissure that separates allies.

    “The only security guarantee that works … is NATO membership,” Estonian Prime Minister Kaja Kallas said Thursday, echoing Zelenskyy’s message.

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    Suzanne Lynch and Clea Caulcutt

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  • ChatGPT boss wants HQ in Europe

    ChatGPT boss wants HQ in Europe

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    Sam Altman wants you to know he loves Europe.

    The CEO of OpenAI, the maker of the artificial intelligence tool ChatGPT, spent last week touring the Continent, stopping in Spain, France, Poland, Germany and the United Kingdom. He was at once talking AI regulation with policymakers — he met national leaders Pedro Sánchez, Emmanuel Macron, Mateusz Morawiecki, Olaf Scholz, and Rishi Sunak — and scouting locations for an OpenAI European office.

    “We really need an office in Europe,” Altman told POLITICO at a Paris event Friday. “We also just really want one.” Under the European Union’s upcoming Artificial Intelligence Act, companies with EU-based users would need a presence in the bloc, with national “supervisory authorities” in charge of implementing the regulation. The eventual choice of its HQ location will, therefore, determine which member country will oversee it when it comes to enforcing the AI Act.

    Since its launch in November 2022, OpenAI’s ChatGPT — a bot able to create texts such as songs, scripts, articles and software based on written prompts — has caused both optimism and anxiety about what the rise of AI means for the future of humankind. While some have marveled at the tool’s prowess in creating computer code and streamlining office work, others fear that it could be used to generate troves of automated disinformation, manipulative content and biased material — or even put millions of people out of a job.

    Nevertheless, politicians appear eager to host the world’s hottest AI lab. Opening the event, French Digital Minister Jean-Noël Barrot read a ChatGPT-generated description of Altman (“innovative, influential, visionary”) before pitching France as a “great AI country” — rattling off a list that included talent, abundant nuclear energy (to power the computers underpinning the AI), and cultural heritage among its assets.

    In the U.K., where Altman also briefed national security personnel, a person familiar with his conversation with Sunak, who was granted anonymity to talk of high-level meetings, described the British prime minister as “deferential.”

    Altman is still deliberating on where to house the new office. “If you had to pick just based on the most AI research talent, you’d pick France,” he told POLITICO. “But I’ve been super-impressed by the talent and energy everywhere.” OpenAI already has staff working in London, according to LinkedIn, and in September 2022 it created a U.K. subsidiary, according to the country’s business registry.

    In Paris, Altman strove to quash reports, from Reuters, that OpenAI might leave the EU if the AI Act proved too onerous. “We plan to comply. We want to offer services in Europe,” Altman told the Parisian audience. “We just want to make sure we’re technically able to. And the conversations have been super-productive this week,” he added.

    First floated by the European Commission in 2021, the AI Act would ban some uses of AI uses (such as social scoring and some instances of facial recognition) and impose stricter rules related to safety and oversight when it comes to sensitive AI applications considered “high-risk.” On top of that, according to a version of the AI Act adopted earlier this month by lawmakers in the European Parliament, “generative” models such as ChatGPT — which can create new content, like text or photos — would have to disclose a summary of copyrighted materials used as training data.

    The rule — which still needs to be agreed upon by representatives of the Commission and EU member countries — addresses worries from artists and publishers that AI firms might use their intellectual property without their consent or knowledge.

    “That sounds like a great thing to ask for,” Altman told POLITICO. “But — due to the way these datasets are collected and the fact people have been copying data in different ways on different websites — to say I have to legally warrant every piece of copyrighted content in there is not as easy as it sounds.”

    Altman thinks an easier way for creators to know if their work is being used would be based on whether their names appear in the prompts users give to an AI. “Every time you ask, ‘I want a song in the style of the Beatles,’ that would be clear,” Altman said.

    Sam Altman is the CEO of OpenAI, the maker of the artificial intelligence tool ChatGPT | Drew Angerer/Getty Images

    All in all, however, Altman struck an optimistic tone about the AI Act and said he’d be happy to meet EU policymakers — despite skipping a planned Brussels stop in his tour. He told POLITICO that OpenAI would join the EU’s first “sandbox,” based in Spain, where AI companies will be able to test their regulatory compliance.

    “It’s going to get to a good place,” he said. “Regulatory clarity will be a good thing.”

    This article has been updated.

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    Gian Volpicelli

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  • The F-16 takeoff to Ukraine will take time

    The F-16 takeoff to Ukraine will take time

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    Don’t expect to see F-16s in Ukrainian skies anytime soon — the allies need some time.

    Following months of Ukrainian lobbying, the U.S. on Friday greenlit training for Ukrainian pilots on fourth-generation fighter aircraft, raising expectations that a fleet of F-16s would soon be on its way.

    Yet as of now, some of the leading contenders to donate the American-developed warplanes — including the Netherlands, Belgium and Denmark — have only committed to helping train Ukrainian pilots, expressing reluctance to make further promises. 

    “Let’s make sure we now make the most of training activities,” Dutch Foreign Minister Wopke Hoekstra told reporters in Brussels on Monday. “What the future then holds for us,” he added, “remains to be seen.” 

    Some, like Belgium, have even directly said they don’t have F-16s to spare.

    The pattern, however, is one that has played out over and over as Western allies gradually escalate the weaponry they are shuttling to Ukraine. At first, there is hesitation. Then one of the major powers — often the U.S. — takes a first step, followed by a coalition of European nations that jump roughly together. 

    “This is kind of indicative of how the U.S. has provided assistance at every step of the war in Ukraine,” said Seth Jones, director of the International Security Program at the Center for Strategic and International Studies (CSIS). 

    For now, no one is ready to send the first jet. That could easily change — in time.

    “The delivery of F-16s will indeed make a difference … months from now,” said Ben Hodges, former commanding general of U.S. Army Europe. 

    Where are the jets now?

    The slow decision-making is linked to both political and technical considerations. Few countries have an F-16 surplus, and the modern machines require significant training and logistics. The U.S. also has to authorize other countries to re-export the plane. 

    Yuriy Sak, an adviser to Ukrainian Minister of Defense Oleksii Reznikov, said “the Netherlands are in a position to be [the] first” country gifting fighter jets.

    The Netherlands currently has 24 F-16s in use which are “operationally deployable” and “will remain in use until mid-2024,” a spokesperson for the Dutch defense ministry said. “After that, they are available for another destination, such as sale.” 

    Ukrainian Air force MiG-29 fighter planes take part exercises during August 2016 | Sergei Supinsky/AFP via Getty Images

    The Netherlands also has an additional 18 F-16s “which are no longer used operationally” and “can also be given a different destination.”

    Twelve of these 18 were originally slated to be transferred to a private company, but the transfer had been delayed, the spokesperson noted. 

    Predictably, the U.S., where the F-16 was invented, maintains its own massive fleet. Yet asked Monday if there is any chance the U.S. will provide its own planes, U.S. Air Force Secretary Frank Kendall told reporters: “I don’t know. I mean, I think there’s a number of possibilities.”

    The U.K., meanwhile, has been an aggressive advocate of creating a Western “coalition for jets.” But the country itself lacks any F-16s to donate.

    Several other capitals have also signaled they are only willing to go as far as training. In addition to Belgium, Polish President Andrzej Duda said last week that Warsaw will not give away its more modern jets — the country maintains a fleet of 48 F-16s — after already donating Soviet-era MiG-29s.

    How long will training take? Where will it happen?

    Washington has indicated that while it now supports Ukraine getting access to the F-16s, the decision is designed to help Kyiv in the longer term — and won’t have an immediate impact on the battlefield. 

    “It will take several months at best for them to have that capability and there are a lot of details that are going to have to be sorted out,” Kendall, the air force secretary, said Monday. “It will give the Ukrainians an incremental capability that they don’t have right now. But it’s not going to be a dramatic game changer.”

    For now, allies are working to get the training started.

    A spokesperson for German Chancellor Olaf Scholz — whose country doesn’t have F-16s — said on Monday that Berlin and Washington were in “close coordination” on the plans, but stressed that the program “takes several months or even years, depending on the previous experience of the pilots.”

    The spokesperson cited Spangdahlem and Ramstein as air force bases in Germany where the U.S. has F-16s stationed, offering possible sites for practice. The spokesperson declined to comment on what specific support Berlin may provide. 

    Some experts have criticized the pace of decision-making. 

    The U.S. administration’s “continued incremental decision-making undermines so much of the good work it has already done,” Hodges, the former U.S. general, told POLITICO on Monday. 

    “If the administration would decide that it wants Ukraine to actually win this war, then all the excuses would go away, decisions would be made in time, and the full effect of Western support would bring about the quickest possible successful conclusion to this war,” he added.

    Kendall, the U.S. air force secretary, underscored that the issue is a matter of priorities — and that there is now a shift to thinking ahead.  

    “We could certainly have started earlier, but there were much higher priorities and it’s seen by some as an escalatory act on our part,” he said. 

    How would Ukraine use F-16s? Would Russia respond?

    While there were fears earlier in the conflict that providing advanced, Western fighter jets could be escalatory, officials appear to have shed those concerns — as they did earlier in the conflict on the issue of sending modern, Western tanks. 

    A diplomat from a European country with F-16s said Ukraine could use the planes in different ways, including mere surveillance and defense of its airspace, and commit to not launch any bombing campaigns over Russian territory.

    U.S. President Joe Biden said over the weekend that he received “a flat assurance” from Ukrainian President Volodymyr Zelenskyy that the jets will not be used in Russian territory. “But wherever Russian troops are within Ukraine in the area, they would be able to do that,” he said. 

    Alexander Grushko, Russia’s deputy foreign minister, warned that Western countries sending F-16s to Ukraine would incur “colossal risks for themselves,” according to Russia’s state-owned news agency Tass. Yet that’s a message Moscow has tossed out for each new stage of Western support — and the Kremlin is running out of ways to escalate further.

    “There is not much they can do,” said Jones, the CSIS scholar. “I think it reflects that the concerns I think that a range of government officials have had about how the Russians might respond to more sophisticated weapons have just not proven to be accurate.”

    The European diplomat said the U.S. could grow more comfortable with the idea of sending F-16s to Ukraine if Kyiv fails to make significant gains in its upcoming offensive, or if the West finds itself unable to supply Ukraine with other key needs and decides to compensate with jets.

    Asked if it is realistic for Ukraine to get F-16s by the fall, a senior Central European defense official was upbeat, saying “I think it is.”

    Weighing in on the same question, a senior diplomat from Eastern Europe quipped: “Why not?”

    Jacopo Barigazzi, Hans von der Burchard, Jan Cienski and Barbara Moens contributed reporting.

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  • Zelenskyy in Berlin amid push for new weapons for Ukraine

    Zelenskyy in Berlin amid push for new weapons for Ukraine

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    Ukrainian President Volodymyr Zelenskyy touched down in Germany Sunday morning ahead of talks to secure new Western weaponry for his country and to shore up support among European allies.

    “Already in Berlin,” Zelenskyy wrote on Twitter. “Weapons. Powerful package. Air defense. Reconstruction. EU. NATO. Security,” he added in reference to his priorities for the visit, which comes on the heels of meetings in Rome on Saturday with Italian Prime Minister Giorgia Meloni and Pope Francis.

    Signing a guest book ahead of meeting top German officials, Zelenskyy wrote that “together we will win and bring peace back to Europe,” hailing Berlin as a “true friend and reliable ally.”

    Following talks with German Chancellor Olaf Scholz in Berlin, the two leaders are expected to fly to the city of Aachen, where Zelenskyy will collect the International Charlemagne Prize, awarded to him in December for the defense of “Europe and European values.”

    Ukraine on Saturday said it had made a series of strategic gains around the town of Bakhmut, where its forces have faced a fierce Russian onslaught for weeks. According to CNN, U.S. officials believe Kyiv is conducting “shaping operations” to lay the foundations for a major counteroffensive to take back its territory.

    Ahead of Zelenskyy’s visit to Berlin, the German government on Saturday announced a new package of military aid worth an estimated €2.7 billion, which will be the country’s largest delivery of arms to Ukraine since Russian President Vladimir Putin launched his all-out invasion in February 2022.

    “We all wish for a speedy end to this terrible and illegal war,” German Defense Minister Boris Pistorius said. “Unfortunately, this is not yet foreseeable.”

    While Kyiv officials had previously hit out at Berlin over a reluctance to supply military hardware and its dependence on Russian oil and gas imports, the country has since emerged as one of the largest exporters of arms and armor to Ukraine.

    The latest package includes 30 Leopard-1 A5 main battle tanks, four new IRIS-T SLM anti-aircraft rocket launchers, dozens of armored personnel carriers and other combat vehicles, 18 self-propelled Howitzers and hundreds of unarmed recon drones.

    Zelenskyy’s last visit to Germany, attending the Munich Security Conference in February 2022, came just days before Moscow launched its full-scale invasion of Ukraine. At the high-profile defense event, U.S. Vice President Kamala Harris had warned that Europe faced “a decisive moment in history” and pledged support for Kyiv if Russia attacked.

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  • France to give Ukraine more armored vehicles and light tanks, Macron and Zelenskyy announce after surprise summit

    France to give Ukraine more armored vehicles and light tanks, Macron and Zelenskyy announce after surprise summit

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    France “will train and equip” several Ukrainian battalions and provide them with “tens of armored vehicles and light tanks,” Emmanuel Macron and Volodymyr Zelenskyy announced late Sunday.

    The news came after Ukraine’s president traveled to Paris and had a three-hour dinner with his French counterpart (including one hour alone, without advisers) as part of a tour of European capitals designed to shore up support among Kyiv’s allies.

    “In the coming weeks, France will train and equip several battalions with tens of armored vehicles and light tanks, including AMX-10RCs,” according to a joint statement issued by both France and Ukraine after the dinner. France is also “focusing its effort in supporting Ukraine’s air defense capacities.” Macron and Zelenskyy also called for new sanctions against Russia.

    Macron is also expected to make more announcements on Ukraine on Monday.

    “What Ukraine needs is combat equipment, armoured vehicles, tanks, artillery,” an Elysée official said. “Zelenskyy also expressed the need to protect the skies from drone or missiles attacks … France will continue to deliver … More of the most modern systems will be offered.”

    But on the question of whether Paris would send Ukraine the fighter jets it has been asking for, the French official said: “That discussion is a bit premature” due to the focus on land operation and air defenses.

    As he arrived in France, Zelenskyy said: “With each visit, the defensive and offensive capabilities of Ukraine increase.” He added: “The connection with Europe is getting stronger, and the pressure on Russia is increasing. I will meet my friend Emmanuel. Let’s discuss the most important points of bilateral relations.”

    Agence-France Presse and a handful of other outlets first reported on Sunday that French President Emmanuel Macron would receive Zelenskyy in the evening and the two leaders will hold talks over dinner ahead of a possible joint announcement.

    The Ukrainian president earlier Sunday was in Berlin to meet with German Chancellor Olaf Scholz, who confirmed that his country would send a €2.7 billion package of military aid to support Ukraine.

    “Now is the time for us to determine the end of the war already this year, we can make the aggressor’s defeat irreversible already this year,” Zelenskyy said at a press conference with Scholz.

    On Saturday, Zelenskyy met with Italian Prime Minister Giorgia Meloni in Rome, thanking her for “helping to save lives” by continuing to provide aid to Kyiv. He also sat down for an audience with Pope Francis, who told the Ukrainian leader that he is “praying for peace.”

    The flurry of diplomatic visits comes as Ukraine calls on the West to provide its armed forces with more heavy weaponry and fighter jets to support a long-awaited counteroffensive and help liberate Russian-occupied territory in the east of the country.

    “We are working on the creation of a coalition of combat aircraft,” Zelenskyy said on Sunday, as fierce battles continued to rage near the contested town of Bakhmut, where the two sides have been locked in a bloody stalemate for weeks.

    According to Kyiv, its troops have made a series of gains there in recent days, and Zelenskyy has pledged to take back swathes of territory currently held by Russian forces, while adding that he is open to peace talks on Ukraine’s terms.

    This article was updated.

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  • Europe’s disunity over China deepens

    Europe’s disunity over China deepens

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    BRUSSELS — Just when you thought Europe’s China policy could not be more disunited, the two most powerful countries of the European Union are now also at odds over whether to revive a moribund investment agreement with the authoritarian superpower.

    For France, resuscitating the so-called EU-China Comprehensive Agreement on Investment (CAI) is “less urgent” and “just not practicable,” according to French President Emmanuel Macron.

    Meanwhile, German Chancellor Olaf Scholz is in favor of “reactivating” the agreement, which stalled soon after it was announced in late 2020 after Beijing imposed sanctions on several members of the European Parliament for criticizing human rights violations. 

    Speaking to POLITICO aboard his presidential plane during a visit to China earlier this month, Macron said he and Chinese leader Xi Jinping discussed the CAI, “but just a little bit.”

    “I was very blunt with President Xi, I was very honest, as far as this is a European process — all the institutions need to be involved, and there is no chance to see any progress on this agreement as long as we have members of the European Parliament sanctioned by China,” Macron told POLITICO in English.

    Beijing has proved skilled at preventing the EU from developing a unified China policy, using threats ranging from potential bans on French and Spanish wine to warnings that China will buy American Boeing instead of French Airbus planes.

    Disagreement over the CAI is only one further example of divergence over China policy in Europe, where Beijing has expertly courted various countries and played them against each other in games of divide-and-rule over the past decade.

    Scholz seeks CAI thaw

    Following seven years of tortuous negotiations, the CAI was rushed through by former German Chancellor Angela Merkel at the end of Germany’s six-month rotating presidency of the Council of the EU in late 2020. 

    Merkel sought to seal the deal and ingratiate herself with Beijing before Washington could apply pressure to block it, causing tension with the incoming administration of U.S. President Joe Biden.

    Germany has long been the most vocal cheerleader for the CAI due to its scale of manufacturing investments in China, particularly in the car-making and chemicals sectors. 

    The CAI would have made it marginally easier for European companies to invest in China and protect their intellectual property there. But critics decried weak worker protections and questioned to what degree it could be enforced. 

    Xi Jinping during Macron’s visit to Beijing | Ludovic Marin/AFP via Getty Images

    Soon after the agreement was announced, Beijing imposed sanctions on several European parliamentarians in retaliation for their criticism of human rights abuses in the restive region of Xinjiang. 

    The deal, which requires ratification by the European parliament, went into political deep freeze.

    Scholz, who at times seems to mimic the more popular Merkel, would like to take CAI “out of the freezer” — but has cautioned that “this must be done with care” to avoid political pitfalls, according to a person he briefed directly but who was not authorized to comment publicly.

    “It is surprising Scholz still thinks this is a good idea, despite the vastly changed context from a couple of years ago,” said one senior EU official, who spoke on condition of anonymity to freely discuss sensitive diplomatic issues.

    EU branches split

    Not only are EU countries divided on how to approach CAI — there’s also a rift among institutions in Brussels.

    With its members sanctioned, the European Parliament is certain to reject any fresh attempt to ratify the CAI.

    But like Scholz, European Council President Charles Michel also hopes to resuscitate the deal. He has discussed this with Chinese communist leaders, including during his solo visit to Beijing late last year, according to a senior EU official familiar with the matter who was not authorized to speak publicly.

    European Commission President Ursula von der Leyen, however, has stymied Michel’s attempts to place the agreement back on the agenda in Brussels. Von der Leyen is far more skeptical of engaging with China, citing increasing aggression abroad and repression at home.

    Von der Leyen accompanied Macron on part of his China trip earlier this month, but said of her brief meeting with Xi Jinping and other Chinese officials that the topic of CAI “did not come up.” She has publicly argued that the deal needs to be “reassessed” in light of deteriorating relations between Beijing and the West.

    Meanwhile, Chinese officials have made overtures to Michel and other sympathetic European leaders, suggesting China could unilaterally lift its sanctions on members of the European Parliament — but only with a “guarantee” the CAI would eventually be ratified. 

    A spokesperson for Michel said an informal meeting of EU foreign ministers will discuss EU-China relations on May 12. “Following that discussion we will then assess when the topic of China is again put on the table of the European Council,” he said.

    During the same interview with POLITICO, Macron caused consternation in Western capitals when he said Europe should not follow America, but instead avoid confronting China over its stated goal of seizing the democratic island of Taiwan by force. 

    Manfred Weber, head of the center-right European People’s Party, the largest party in the European Parliament, described the French president’s comments as “a disaster.” 

    In an an interview with Italian media, he said that the remarks had “weakened the EU” and “made clear the great rift within the European Union in defining a common strategic plan against Beijing.”

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  • Germany aims to ‘set the record straight’ on China after Macron’s Taiwan comments

    Germany aims to ‘set the record straight’ on China after Macron’s Taiwan comments

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    BERLIN — German Foreign Minister Annalena Baerbock is heading to China to represent Berlin, but she’ll likely have more explaining to do about Paris in the wake of French President Emmanuel Macron’s explosive comments on Taiwan.

    As Baerbock embarked on her two-day visit Wednesday evening, officials in Berlin were eager to stress that Germany and the EU care about Taiwan and stability in the region, arguing it’s mainly China that must contribute to de-escalation by refraining from aggressive military maneuvers close to the island nation.

    Baerbock’s trip comes amid international backlash against Macron’s comments in an interview with POLITICO, arguing Europe should avoid becoming America’s follower, including on the matter of Taiwan’s security. Although German government spokespeople refused to comment directly on the French president’s remarks, a spokesperson for the foreign ministry specifically called out Beijing when expressing “great concern” over the situation in the Taiwan Strait.

    “We expect all parties in the region to contribute to peace. That applies equally to the People’s Republic of China,” the spokesperson said, adding: “And it seems to us that actions such as military threatening gestures are counter to that goal and, in fact, increase the risk of unintended military clashes.”

    Nils Schmid, the foreign policy spokesperson for German Chancellor Olaf Scholz’s Social Democratic Party (SPD), said he expects Baerbock to “set the record straight” during her trip to China, which will involve meetings with Beijing’s Foreign Minister Qin Gang, Vice President Han Zheng and top diplomat Wang Yi.

    “We clearly defined in the [government] coalition agreement that we need a changed China policy because China has changed. The chancellor made that clear during his visit. Above all, Scholz also issued clear warnings about Taiwan during his visit [last year],” Schmid wrote in a tweet. “I assume that Foreign Minister Baerbock will repeat exactly that and thus set the record straight and make a clarification after Macron’s botched visit.”

    Berlin traditionally has been much more in sync with the U.S. on foreign and security policy than France has, which is why many politicians and officials in the German capital reacted with horror to Macron’s comments. The French president said Europe should not take its “cue from the U.S. agenda and a Chinese overreaction,” suggesting the EU stood between the two sides, rather than being aligned with its longtime democratic partners in Washington.

    Macron gave the impression to some in the U.S. that Europeans see Beijing and Washington as “equidistant” from Brussels in terms of values and as allies, said SPD foreign policy lawmaker Metin Hakverdi, who is currently on a parliamentary visit to the U.S.

    “That was foolish,” Hakverdi told POLITICO, adding that “Macron potentially damaged the peaceful status quo around Taiwan” by giving “the public impression that Europe has no particular interest in the conflict over Taiwan.

    “The issue of Taiwan is not an internal matter for the People’s Republic of China. Anything else would virtually invite Beijing to attack Taiwan,” Hakverdi added. “I am confident that our foreign minister will make that clear during her trip to Asia — both to Beijing and to our Asian partners.”

    Katja Leikert from the main German opposition party, the center-right CDU, criticized Macron’s comments as “extremely short-sighted,” and added: “Should China decide to strike Taiwan militarily, either by invading it or by starting a maritime blockade, this would have significant political and economic repercussions for us. We cannot just wish that away.

    “What we actually need to do right now is strengthen our defense against aggressive measures from Beijing,” Leikert said.

    For Berlin, Macron’s comments also come at a particularly bad moment for transatlantic ties. The German government is keen to mend cracks in its relationship with Washington that have emerged over the controversial benefits for U.S. businesses under Joe Biden’s Inflation Reduction Act. Europe hopes to reach an agreement so that its own companies may also be eligible for these subsidies.

    Macron’s comments “will not help in renegotiations on the Inflation Reduction Act, nor will they help Joe Biden in the election campaign against populist Republican candidates,” said the SPD’s Hakverdi.

    The German foreign ministry spokesperson was quick to stress that both France and Germany were involved in shaping a joint EU-China policy | Ludovic Marin/AFP via Getty Images

    The German foreign ministry spokesperson was quick to stress that both France and Germany were involved in shaping a joint EU-China policy, which was also done in cooperation “with our transatlantic partner.”

    During her trip to China, Baerbock plans to raise the situation in the Taiwan Strait; Russia’s war of aggression against Ukraine; the human rights situation in China; as well as the fight against climate crisis, the spokesperson said.

    Baerbock’s foreign ministry is also currently drafting Germany’s first China strategy. A draft of this seen by POLITICO last year vowed to take a much harder line toward Beijing. Baerbock and her Green party are at the forefront of pushing such a tougher position, while Scholz has long preferred a softer approach.

    Incidentally, however, the German government said Wednesday it is reassessing whether to potentially take a firmer stance and ban Chinese state company Cosco from going through with a highly controversial move to buy parts of a Hamburg port terminal.

    Scholz had strongly pushed for the port deal ahead of his own trip to Beijing last year, but the future of the transaction is now in doubt after German security authorities classified the terminal as “critical infrastructure.”

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  • Olaf Scholz faces new probe over German tax fraud scandal

    Olaf Scholz faces new probe over German tax fraud scandal

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    BERLIN — Germany’s center-right opposition wants to raise the heat on Chancellor Olaf Scholz by launching a parliamentary investigation into his alleged connection to a massive tax evasion scandal.

    The case — which dates back over five years to the time when Scholz was still mayor of the Hamburg city-state — is linked to the broader so-called “Cum Ex” affair, under which the German state was defrauded by over €30 billion as some banks, companies, or individuals claimed tax reimbursements from authorities for alleged costs that never occurred.

    The scandal already hung over the Social Democratic politician’s election campaign in 2021 but had little impact in the end as Scholz’s potential involvement remained unclear. Now it is heating up again after new details emerged that put his previous defense in question.

    The Hamburg regional parliament plans to summon Scholz this spring — which will be for the third time — to an investigative committee looking into the scandal. And now the center-right CDU/CSU bloc also wants to set up an inquiry at the national level in the Bundestag.

    “We will request a parliamentary committee of inquiry into the Scholz-Warburg tax affair in the German Bundestag in the first parliamentary week after the Easter vacations,” said the CDU’s Mathias Middelberg, deputy parliamentary group chairman, on Tuesday.

    A government spokesperson said that “as a matter of principle,” Berlin does not comment on decisions announced by Bundestag members “out of respect for the constitutional body,” according to media reports.

    Katja Mast, the Social Democrats’ chief whip, said the CDU/CSU is not following any interest in knowledge, but rather party tactical interests. “They bring up allegations that have long been refuted,” she said, adding that the committee in Hamburg had clarified all questions.

    The CDU/CSU group has enough votes in parliament to be able to set up an investigative committee. The Left party also said it would back such a request. Parliamentary investigative committees can hear witnesses and experts and request access to documents. Although the findings are summarized in a non-binding report, the political consequences, such as for upcoming elections, could be significant.

    In a letter to the CDU/CSU parliamentary group seen by POLITICO, chairmen Friedrich Merz and Alexander Dobrindt said that the case should be investigated due to its “significant” importance for German national politics.

    Scholz has come under scrutiny because of his links to one Hamburg-based bank involved in the tax evasion scheme: During his time as mayor, he met on three separate occasions in private with one of the owners of the M.M. Warburg & Co. bank, which was already under investigation at the time by the Hamburg tax office. Officials were planning to reclaim €47 million, which they believed were ill-gotten gains in connection with the fraud.

    However, in the end, the finance authority let the statute of limitations on the payment demand expire — and years later, after details of Scholz’s meetings with the banker emerged, critics began questioning whether the top Social Democrat might have intervened in favor of the bank.

    Although the chancellor has constantly denied having intervened, he has also given no answer on what was discussed during the private meetings. Instead, Scholz said on several occasions during the past two-and-a-half years that he cannot remember the content of the discussions.

    During his time as mayor of the Hamburg city-state, Scholz met with one of the owners of the M.M. Warburg & Co. Bank, involved in a tax evasion scheme | Morris MacMatzen/Getty Images

    That defense is now being called into question as details emerged of a previous and longtime confidential Bundestag committee hearing with Scholz in July 2020, in which he appeared to easily remember details of his meetings with the banker. His critics argue that Scholz only started to claim having no memory of the meetings when their political and possibly criminal explosiveness became clear.

    “This comprehensive memory gap of the chancellor after an initial memory of a concrete meeting … raises a multitude of questions to be clarified,” the letter from the CDU/CSU states.

    Scholz and his allies have repeatedly rejected such criticism as politically motivated and stressed that past investigations found no wrongdoing. Scholz also highlighted that in the end, the bank did repay the €47 million, albeit only after it was ordered to do so by a court. The Hamburg Public Prosecutor’s Office said in March that it does not see any initial suspicion against the chancellor in the affair.

    That hasn’t discouraged the opposition from planning to dig deeper, though.

    “The chancellor would like to see … a line drawn under the clarification of this tax affair. But it is precisely the task of parliament to control the government, to look closely, especially with so many unanswered questions,” said CDU lawmaker Matthias Hauer.

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  • Emmanuel Macron wants to charm China — after failing with Putin

    Emmanuel Macron wants to charm China — after failing with Putin

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    PARIS — French President Emmanuel Macron is jetting off on an ambitious diplomatic mission to woo Beijing away from Moscow. Officials in Washington wish him luck with that.

    France hopes to dissuade China’s leader Xi Jinping from getting any cozier with Russian President Vladimir Putin, and wants the Chinese instead to play a mediation role over the war in Ukraine.

    However, it is unclear what leverage Macron has — and the backdrop to his three-day trip starting Tuesday isn’t easy. Europe continues to reel from the impact of cutting off trade ties to Russia and geopolitical tensions are ratcheting up between China and the U.S., the world’s two biggest economies.

    The French president wants to play a more personal card with his Chinese counterpart, after drawing fierce criticism for hours of fruitless phone calls with Putin last year — an effort that failed to stop Russia’s full-scale invasion of Ukraine.

    Macron is expected to spend several hours in discussions with Xi, and the trip includes a visit to a city that holds personal value for the Chinese president.

    “You can count with one hand the number of world leaders who could have an in-depth discussion with Xi,” said an Elysée advisor who asked to remain anonymous because they were not authorized to speak publicly.

    But while expectations in France of a breakthrough are moderate, the view among other Western officials is even bleaker.

    Given Macron’s failed attempts at playing a center-stage role in resolving conflicts, such as stopping the war in Ukraine or salvaging the Iran nuclear deal, there are doubts in the U.S. and elsewhere that this trip will deliver major results.

    The White House has little expectation that Macron will achieve a breakthrough, according to three administration officials not authorized to speak publicly about private conversations. Xi is unlikely to act on Macron’s requests or curtail any of China’s assertive moves in the Pacific, the officials said.

    White House aides ruefully recalled Macron’s failed attempts to insert himself as a peacemaker with Putin on the eve of the invasion more than a year ago and anticipate more of the same this time.

    There is also some concern in the Biden administration about France’s potential coziness with China at a time when tensions between Washington and Beijing are at their highest in decades, even though the White House is supportive of the trip, the three officials said. There is no ill will toward Macron’s efforts in Beijing, they stressed.

    But what might further complicate Macron’s endeavors is an emerging feud between the European Commission President Ursula von der Leyen, who is traveling with the president, and the Chinese.

    Last Thursday, President of the European Commission Ursula von der Leyen delivered a keynote address on EU-China relations at the European Policy Centre in Brussels | Valeria Mongelli/AFP via Getty Images

    In a high-profile speech on EU-China relations Thursday, von der Leyen urged EU countries to “de-risk” from overdependency on China. She also implied that the EU could terminate the pursuit of a landmark trade deal with China, which was clinched in 2020 but subsequently stalled. Her remarks sparked swift blowback from Chinese diplomats. Fu Cong, China’s ambassador to the European Union, said Friday he was “a little bit disappointed.”

    “That speech contained a lot of misrepresentation and misinterpretation of Chinese policies and the Chinese positions,” Fu told state-owned broadcaster CGTN.

    The Europeans’ visit will also be scrutinized from a human rights perspective given China’s authoritarian pivot and alleged human rights abuses across the nation.  

    “President Macron and von der Leyen should not sweep the Chinese government’s deepening authoritarianism under the rug during their visit to Beijing,” said Bénédicte Jeannerod, France director at Human Rights Watch. “They should use their public appearances with Xi Jinping to express strong concerns over widespread rights abuses across China, heightened oppression in Hong Kong and Tibet, and crimes against humanity in Xinjiang.”

    Macron’s playbook

    Speaking ahead of the visit to Beijing, the French leader said his aim was to “try and involve China as much as possible to put pressure on Russia” on topics such as nuclear weapons. 

    But will Macron’s charm work on Putin’s “best friend” Xi?

    China has sought to position itself as a neutral party on the conflict, even as it has burnished its ties with the nation, importing energy from Russia at a discount. Despite massive international pressure on Moscow, Xi decided to make the Kremlin his first destination for a state visit after he secured a norm-breaking third term as Chinese leader. Meanwhile, POLITICO and other media have reported that the Chinese have made shipments of assault weapons and body armor to Russia.

    Western European leaders that were cozy with Moscow just before the war started are now calling for engagement with China, including Macron himself. Spain’s Prime Minister Pedro Sánchez was in China just days before Macron’s arrival, saying that the world “must listen to its voice” on Russia and Ukraine.

    During his visit, which aides have been discussing since at least November last year, Macron will spend several hours with Xi in Beijing, and accompany him to the city of Guangzhou. The Chinese leader’s father, Xi Zhongxun used to work there as Guangdong province governor.  

    “Altogether the president will spend six to seven hours in discussions with the Chinese leader. The fact that he will be the first French president to visit Guangzhou is also a personal touch, since President Xi’s father used to be a party leader there,” said the Elysee official cited earlier.

    The French are hoping the time Macron spends privately with Xi will help win Chinese support on issues such as stopping Russian attacks on civilian infrastructure in Ukraine or halting the illegal transfer of Ukrainian children.

    It’s also expected that Macron will try to test Xi’s reaction to Russia’s threat to host nuclear missiles in Belarus, a decision that flies in the face of China’s non-proliferation stance, barely a month after Beijing revealed its 12-point plan for resolving the conflict in Ukraine.

    Despite massive international pressure on Moscow, Xi decided to make the Kremlin his first destination for a state visit after he secured a norm-breaking third term as Chinese leader | Greg Baker/AFP via Getty Images

    “It’s absolutely fundamental to have moments of private encounters,” said Sylvie Bermann, France’s former ambassador to China. “Diplomacy is about playing the long game …With China, I don’t think it is easy to strike up relationships as Westerners. But maybe it means that we’ll be able to talk when the time comes.”

    Despite the show of goodwill however, the French president will not hold back from sending “some messages” to Beijing on supporting Russia, particularly when it comes to arms deliveries, a senior French official said.

    “We aren’t going to threaten, but send some warnings: The Chinese need to understand that [sending weapons] would have consequences for Europe, for us … We need to remind them of our security interests.” The official said Macron would steer clear of threatening sanctions.

    Antoine Bondaz, China specialist at Paris’ Foundation for Strategic Research, questioned the emphasis on trying to bond with Xi. “That’s not how things work in China. It’s not France’s ‘small fry’ president, who spends two hours walking with Xi who will change things, China only understands the balance of power,” he said. “Maybe it works with Putin, who has spent over 400 hours with Xi in the last ten years, but Macron doesn’t know Xi.”

    EU unity on show as trade takes center stage

    Trade will also feature high on Macron’s priorities as he brings with him a large delegation of business leaders including representatives from EDF, Alstom, Veolia and the aerospace giant Airbus. According to an Elysée official speaking on condition of anonymity, a potential deal with European plane maker Airbus may be in the works, which would come after China ordered 300 planes for €30 billion in 2019.

    Finance Minister Bruno Le Maire and Foreign Affairs Minister Catherine Colonna are also traveling with the president.

    With the EU facing an emerging trade war between China and the U.S., the presence of von der Leyen, will add yet another layer of complexity to the mix. The French president said in March that he had “suggested to von der Leyen that she accompany him to China” so they could speak “with a unified voice.”

    “I don’t have a European mandate, as France has its independent diplomacy — but I’m attached to European coordination,” he said. 

    A joint trip with the EU head sets him apart from Olaf Scholz, the German Chancellor whom French officials criticized in private for hurrying to China for a day trip with Xi last year, focusing more on German rather than EU interests.

    With von der Leyen by his side, Macron may well hope to be seen as the EU’s leading voice. In the U.S., the French president had tried that tactic and obtained some concessions on America’s green subsidies plan for the bloc. 

    In China, that card may be harder to play. 

    Clea Caulcutt reported in Paris, Stuart Lau in Brussels and Jonathan Lemire in Washington.

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    Clea Caulcutt, Stuart Lau and Jonathan Lemire

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