Thursday, October 28

The Greens demand in their negotiations a relaxation of the European Stability Pact

Correspondent in Berlin



They have in their hands the formation of the new German Government and they will decide who occupies the Berlin Chancellery, since none of the big parties can form a coalition without them. And one of the demands that the Greens are raising in the trial and error talks, among their inalienable approaches, is a relaxation of the European Stability Pact, by which the Member States commit to maintain sound public finances, as a means of strengthening the conditions to achieve price stability and strong and sustainable growth that favors job creation. This has been leaked to the German press after the meeting that the eco-pacifist party held yesterday with the Christian Democrats of the CDU / CSU. Undoubtedly, this demand causes less irritation in the other negotiation in which the Greens participate, the one aimed at a “semaphore” coalition that the Social Democrat would lead. Olaf Schol and of which the liberals of the FDP would also form part. But no matter who they do, they will achieve this objective with a high degree of security, since any of the major parties, regardless of their opinions on European financial stability, need green backing to come to power.

The Stability and Growth Pact sets a maximum reference value for the public deficit (3% of GDP) and public debt (60% of GDP). Allows States incur exceptional and temporary deficits higher than the aforementioned proportion in extraordinary circumstances beyond their control, such as the current crisis imposed by the pandemic, or a serious economic recession. Within the framework of the Pact, the euro countries must present each year to the Council of the EU and the European Commission a stability program in order for both institutions to evaluate the degree of compliance with the Pact by each State. This program must include the situation regarding the budgetary balance and public debt objectives, forecasts on the evolution of the most relevant macroeconomic variables, the measures to be adopted to achieve the objectives of the Pact and the analysis of changes in the predicted economic scenario on the achievement of the objectives.

The European institutions analyze the stability and convergence programs and report to the Council on their suitability. If significant deviations from the objectives have been observed, the Council makes recommendations to the corresponding government which, in the event of not taking the appropriate measures, receives warnings that can lead to financial penalties. A relaxation in the objectives would allow governments higher levels of indebtedness and greater freedom when registering deficits in the general budgets, which would lead to an increase in public spending that, without a doubt, will be welcome in the Mediterranean countries and will cause concern and even a rise in Euroscepticism in central Europe and in the so-called ‘thrifty countries’.


In addition to the reform of the Stability Pact, the Greens are demanding in the negotiations a much more open policy on immigration, which Germany will apply in its own territory and also defend in Brussels, thus increasing the conflict with the European countries that refuse to accept refugee quotas. And the third inalienable point that they raise with their interlocutors is the abandonment of combustion engines before 2035, which is the date set by the EU. Germany, as a producing country, would have to set an earlier abandonment in order to meet that date.

The leakage of these contents is causing irritation in the negotiating teams, which had agreed to keep what was said in the scoring meetings a strict secret. In the last hours, in addition, the youths of Los Verdes have given the go-ahead to the negotiation to form the “semaphore” coalition, despite the fact that this means governing jointly and reaching agreements with the liberals of the FDP, whom they consider at the opposite extreme of his political ideas. Thus, points are being added, drop by drop, in favor of a government headed by Olaf Scholz, in which the Stability Pact reform proposal will not only meet with no resistance, but will be driven by a warm favorable wind. In any case, the liberals have already suggested in the campaign that the Stability Pact does not appear on their list of red lines and the one who would most reluctantly oppose such a reform would be the CDU under normal conditions, not in a negotiation in which everything depends on giving in on several key points.

The negotiating teams of the «citrus fruits», as they are nicknamed green and liberal by the corporate colors of the parties, hold a meeting this morning that may be decisive to finally opt for one of the two coalitions, giving rise to the start of official negotiations . The FDP federal board, chaired by party leader Christian Lindner, will discuss the current status of the talks. The Greens, a team of 24 members, will hold a digital meeting to discuss the status of the explorations with potential partners for a future federal government. “They hope to reach a provisional conclusion on the coalition preference,” a spokesman has advanced.

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