Vulcan View – Monday 15th to Friday 19th of October
KEY EVENTS THIS WEEK:
EU Summit – NO Deal but Prime Minister May is given ‘Space’
This week’s much-awaited European Council summit on Brexit ended, as predicted, in deadlock after no substantive progress was made on the issue of the Irish border. British Prime Minister Theresa May addressed her fellow leaders on Wednesday, saying she remained confident that a breakthrough was within reach. However, at a private dinner the EU27 leaders expressed their frustration with the lack of progress in Westminster, with German Chancellor Angela Merkel saying the UK needed to provide “new ideas.”
As a result, the plans for a special Brexit summit next month have been postponed as the EU awaits decisive decisions from Theresa May on the outstanding questions, which Austrian chancellor Sebastian Kurz has said could take “weeks or months.” Leaders have insisted that negotiations would continue, but that they would once again be calling for preparations to be stepped up for a no deal outcome.
Commission President Jean-Claude Juncker highlighted the probability of an extension of the Brexit transition period, whereby the UK will remain under EU laws beyond 2020, to give both parties more time to reach a deal that will involve frictionless trade and no need for a hard border in Ireland. Theresa May has not ruled out the proposition, to the dismay of Brexiters at home, but has insisted the extension would only be for a matter of months. On the other hand Mr Juncker, when talking about the current process, has stated: “We need time, we need much more time.”
In reality, Theresa May’s hands are tied until after the UK 2019 Budget, which is due to be presented to the House of Commons on Monday 29th October. Given her reliance on the DUP to get the Budget passed, it is unlikely she will move to compromise with Brussels until after that date.
EUROPEAN COMMISSION PRESIDENCY
Manfred Weber, EPP chairman, gets support from top European politicians
Manfred Weber, already the frontrunner in the EPP ‘Spitzenkandidat’ race, has taken a big step forward in his bid to be European Commission president. The German MEP and chairman of the EPP Group in the European Parliament formally announced his candidacy last month, although it had been in planning for more than a year. The EPP, which is currently the biggest political group in the European parliament, has been represented by Jean-Claude Junker in this position since 2014. No German politician has occupied this position since 1967.
“Official letters of support” have been sent to the office of Mr. Weber from the prime ministers of Bulgaria, Croatia, Cyprus and Ireland as well as the Austrian chancellor and the president of Romania. In addition to that many members of the EPP group have been voicing their support on social media platforms such as Twitter. Mr. Weber has also been publicly supported by controversial Hungarian Prime Minister Victor Orban.
The only other candidate to enter the race is former Finish prime minister Alexander Stubb who has been mainly absent from the political stage in the last two years. Currently, Mr. Weber seems to be holding a significant lead over the Finn but with both campaigns still in their early stages it remains to be seen if Manfred Weber is able to hold on to that lead ahead of the vote on November 7th.
Juncker-Trump trade agreement in jeopardy
The fragile relief from trade tensions between the EU and the US came under threat once again this Wednesday as representatives from the Trump administration and the European Commission accused each other of delaying trade talks. US President Donald Trump and European Commission President Jean-Claude Juncker reached a deal in July to work towards “zero” tariffs following weeks of escalating trade disputes over the US’ proposal to introduce steel and aluminium tariffs.
Following talks in Brussels on Tuesday, US officials have threatened that car tariffs will be rolled out if trade talks continue to stall. US Commerce Secretary Wilbur Ross criticised EU Trade Commissioner Cecilia Malmström over the EU’s slow pace in opening negotiations saying “This is not meant to be a five-year project: This is meant to be something that was to move quickly and in a cooperative fashion.” The US ambassador to the EU, Gordon Sondland, went even further, suggesting the Commissioner was intentionally delaying and accusing her team of “complete intransigence.”
The comments came in reaction to a statement made by Ms Malmström, suggesting the US had made no sincere effort to enter negotiations. She said: “We have asked, and said that we are prepared, several times, to start the scoping exercise on a limited agreement focused on industrial goods on tariffs there. So far the U.S. has not shown any big interest there, so the ball is in their court.” The commissioner had previously acknowledged that the US appeared to be prioritising the removal of barriers for trade, rather than agreeing on tariffs, and said she is happy to move forward on that basis.
Mr Ross called Ms Malmström’s assessment “very discouraging” and Mr Sondland warned: “If the president sees more quotes like the one that came out today his patience will come to an end.” However, officials from both sides will go ahead with talks on technical barriers for trade in the US next week.
CSU lose absolute majority in Bavarian election
The CSU, sister party of Chancellor Angela Merkel’s Christian Democrats, has suffered its worst election result in the history of the party at Sunday’s election. In Bavaria the party has been dominating elections for over half a century with only one Minister President not belonging to the party since the end of World War II. The party topped the poll, receiving 37.2% of the vote, but lost roughly a quarter of its supporters and its absolute majority. The result was slightly better than some predictions, but was nevertheless described by the party’s leader Markus Söder as “painful.” Ms Merkel’s other coalition partner, the Social Democrats (SPD), also saw huge losses, winning only 9.7%.
The CSU will now look to form a coalition with the right-leaning Freie Wähler (Free Voters), who received 11.6% of the vote. The party also held exploratory talks with the centre-left Green party, who more than doubled their previous election result from 2013 and who were undeniably the biggest beneficiaries of the CSU’s losses. In addition to the surprising results of the Green Party and the Freie Wähler, the election also saw the far-right Alternative for Germany (AfD) win 10.9%, underscoring continued resentment over Angela Merkel’s 2015 immigration policy.
The results reflected the political turmoil Germany has been experiencing most prominently since the general elections last autumn. The continued rise of smaller parties, especially the right wing AfD has plunged the country into a crisis. Chancellor Angela Merkel and her coalition, which has already been experiencing great backlash, has suffered another tremendous blow with these election results.