Germany: 'trade-above-all' policy is over

The fall of Germany’s social contract and moves toward “business as usual” with Russia, with some flirting with Xi Jinping in the background, puts the whole European project in peril. Self-oriented German policies of last year, surprisingly similar in tune to the old rule of Angela Merkel, signifies the greatest danger for European integration since Brexit.

Germany’s attitude pushes Poland and other countries of Central-Eastern Europe in the hands of the USA and UK. Countries of the South have either already fallen into populist hands, or might fall into them soon. The so-called European strategic autonomy is nowhere present but in the words of Emmanuel Macron.

All pillars of German social contract are now shaking. The first one is, of course, energy. Cheap gas was the very foundation of the economic boom and the rule of Angela Merkel. That’s why there was so much effort put into the Nord Stream 1 and 2. They were made to make sure that the energy would flow undisturbed to Germany, thus bypassing the “problematic” countries of Central and Eastern Europe. From the 70’ Germany has been offering the USSR and Russia a hub in the heart of Europe. NS 1 and 2 were meant to deliver Germany a monopoly for gas in Europe.

The second shaking pillar is export.

Companies like Volkswagen, Siemens, Uniper, Schwarz, O-Basf, Aldi and others are the bulwark of Germany’s economy and they have a say when it comes to Germany foreign policy. We have seen that lately in China when Olaf Scholz was accompanied by 12 CEO and other representatives of the biggest German companies. More than 20 out of 30 largest rely on components produced outside of UE, especially in China. In 2002 Volkswagen sent 513 000 vehicles to China. In recent years the revenue of trade between China and Germany is 12 times bigger than at this time, and equals 245 billion euros.

The third one is the pacifist approach: Germany feels secured by the guard of the USA and NATO.

This dependence on foreign power and the comfortable geopolitical seat of Middle European power were the main force that pushed Germany into industry and economy. After the unification of Germany and fall of ‘real socialism’, the next step was to colonize economically the post-Soviet sphere, mainly Czech Republic, Slovakia, Hungary and Poland. These countries were pushed into the position of cheap labor reservoirs, with no real say in foreign policy.

Being dependent on the economic health of Germany is what we can see now especially in Czechia and Slovakia. Those countries’ economies are connected to the German one 1:1. The V4 economic relation with Germany is much bigger for the latter than one with China.

This post-colonial approach toward Mitteleuropa, treated as a reservoir of cheap labor and products, has been the fourth pillar of Germany socio-economical contract.

The third pillar of US military hegemony is right now shifting. Germany, with her tolerant approach towards Russian imperialism, and not so decisive stance on war in Ukraine and the sovereignty of Eastern European countries, pushes US to shift its interest towards Poland and Ukraine, with lesser partners such as Baltic countries, Czech and Slovakia.

This is creating a new space for economic deals, such as atomic power for Romania, Poland and other countries from the US.

Or military deals with South Korea and K2 tanks which are going to be manufactured in Poland. That also leaves the fourth pillar of the German socio-economic contract in peril.

Right now the first pillar needed an absolute reconstruction. As for now, the German government has built an import terminal for liquefied natural gas at the North Sea coast in Wilhelmshaven, and bought huge amounts of the resource at the world market, defending the energy security for this winter. Tankers from countries such as the US, Norway and Emirates are going to provide Germany with gas in the near future. Five more LNG terminals are planned and should be completed (at least most of them) next year. Mid-2024 Germany is going to completely be independent from Russian gas, if we can believe German politicians… who do not seem to be 100% reliable on that matter.

The party of “trade above all” which is right now ruling one in the German establishment, with Olaf Scholz and other SPD leaders as its main representatives (in other parties of the streetlights coalition this course is not that popular), seems not to see how deep changes are to come with Russian invasion of Ukraine.

Mitteleuropa time of colonialist policies toward Poland and others arm in arm with Russia is over. In the east of European Union, no state will believe any more in what politicians from Bundestag might say. At best, the German words will be met in a distanced manner.

The case of Leopards – which allegedly cannot be delivered to Ukraine by Germany because of its allies, which is a plain lie – and other negotiations around the weapons and also manufacturing of them in the future by European countries is strictly showing that.

Olaf Scholz wants to offer right now security guarantees for Ukraine, and at the same time Macron wants to do that towards Russia. This is complete nonsense – because no one is going to put hopes into that.

We have seen that with Minsk agreements already. Some politicians in Germany have already marked that without peace there is not going to be German growth in upcoming years. But what if they, with Angela Merkel’s blessing, had founded it in cooperation with Putin’s Russia? Now they are trying to do the same by flirting with Xi Jinping.

This orientation on bigger players, as we have seen with the US and Russia, now with China, with no regard for other European Union members, is right now the greatest danger in front of the federalization project. Nobody is going to trust Germany if it goes with its “trade above all” policies any further.

Where in all of that is autonomy of the European Union?

Are we really so weak that we have to always count on authoritarian regimes or on the US, which is often little or no better?