Brussels and London are getting closer

Good morning dear readers,

It’s like so many breakups: after a period of hurt, blame and teasing, there comes a point when two ex-partners get closer again – and find a new way of dealing with each other.

The European Union and Great Britain also seem to have reached this point. At least that’s what the pictures from London that went around the world yesterday suggest. British Prime Minister Rishi Sunak and European Commission President Ursula von der Leyen beamed at each other and emphasized their many similarities. “This is the beginning of a new chapter in our relations,” promised the British prime minister.

This new chapter has a name: “Windsor Agreement”. It is about economic custody of the Irish island. Like children after a divorce, it is split between belonging to the EU and belonging to Great Britain. After years of bickering, the apparent breakthrough between London and Brussels has now been achieved, which envisages four central points:

  1. Goods that are shipped from the UK to Northern Ireland and sold there are not subject to customs controls – unlike products that are shipped on to Ireland and thus the EU.
  2. Northern Ireland VAT is again set by London.
  3. The European Court of Justice decides on disputes in Northern Ireland in the EU internal market.
  4. Northern Ireland’s regional parliament in Belfast will have a say in EU legislation.

The new rules have not yet been decided, as the British prime minister still has to push through the deal against opposition from his party and the London-based Democratic Unionist Party (DUP) in Northern Ireland.

Rishi Sunak and Ursula von der Leyen: The British Prime Minister and the President of the EU Commission are satisfied after the agreement.

However, anyone who believes in the greatest love comeback of the decade in the face of these pictures will be disappointed. Handelsblatt correspondent Torsten Riecke in London analyses: Anyone who believes that the deal is Britain’s first step “back into the arms of the EU” is mistaken. The Windsor Agreement is only a “repair manual” for the greatest damage caused by Great Britain’s exit from the EU in Northern Ireland.

Politics is often nothing more than weighing up priorities. A new conflict in the federal government, which the Handelsblatt learned about, shows how difficult this is in the face of multiple crises. The dilemma is: does energy security come first? Or is climate protection more important?

Specifically, it is about energy projects that are to be funded by the Reconstruction Loan Corporation (KfW). Chancellor Olaf Scholz (SPD) and Finance Minister Christian Lindner (FDP) would like the development bank to also finance gas and oil projects, at least temporarily – but Economics Minister Robert Habeck (Greens) does not believe in this idea.

The background to the dispute is that private financiers are not investing billions in the energy infrastructure. Because these are very uncertain investments because they actually thwart the climate goals. KfW could now fill this financing gap – at least if the traffic lights agree on their priorities.

Three, two, one – mine! Buying a model railway, a vinyl record or a dining table on Ebay has long stood for bargain hunting coupled with a little extra adrenaline. But the former pioneer has long since stopped taking part in the online retail boom. Ebay has lost its market power to the US giant Amazon.

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Particularly bitter for the online auction house: its portal eBay classifieds, which it sold to the Norwegian e-commerce group Adevinta in June 2021, is now competing with the former parent company.

Ebay has therefore now come up with a new strategy that brings financial advantages for collectors and bargain hunters: From March, private sales on the portal will be completely free of charge – for both buyers and sellers. So far, they have to pay a commission.

In the long term, eBay itself wants to benefit from the new strategy. The calculus: If more people are on the digital marketplace, they will also buy more from other retailers there. Also lucrative for Ebay, because the commission remains for commercial dealers.

“There is a method to arbitrariness” – this is the conclusion reached by Handelsblatt traffic expert Daniel Delhaes when he analyzes how roads are built in Germany. Because the Ministry of Transport pays experts a lot of money to calculate which transport routes will bring the most benefit – only to then carefully ignore this advice.

Construction work on the A40 in NRW

(Photo: IMAGO/Jochen Tack)

In fact, many urgent projects are currently being abandoned and less urgent ones implemented, including many bypasses. Read the details here.

This practice is not new: even Angela Merkel had a new bridge built from Stralsund to Rügen to avoid traffic jams in her constituency.

The problem of transport policy: New roads and bridges are welcome gifts from many politicians to their home regions, with which they score points with voters at home. This was shown by the fact that the last three CSU transport ministers secured plenty of projects for Bavaria.

Apparently nothing has really changed under the traffic lights in this arbitrary transport policy.

VW factory in Xinjiang: The Volkswagen factory in China poses an enormous reputational risk.

(Photo: Dana Heide [M])

And then there is Volkswagen China boss Ralf Brandstätter, who visited a controversial plant of the automaker in Xinjiang, China, in the middle of the month. In the region, China is suspected of committing human rights abuses against the Muslim Uyghur people. Nevertheless, Volkswagen operates a plant there, which Brandstätter described after his visit with the words “modern premises, well-kept, high standard”.

The inspection was probably intended to defuse the “ticking reputation bomb” that the plant represents for Volkswagen. That’s why Brandstätter quickly emphasized that there was also a gym for the workforce on site. VW cannot close the site until the early 2030s if it does not want to upset the leadership in Beijing.

It greets you cordially

Her

Teresa Stiens
Editor of the Handelsblatt

PS: A year ago, Olaf Scholz spoke in the Bundestag of a “turning point”, that the world has not been the same since the Russian war of aggression. He announced a special fund of over 100 billion euros for the Bundeswehr. We are interested in: Was there actually a turning point in time – or is it more of a slow-motion turning point? In your opinion, where have there been changes? How far has the reform of the Bundeswehr progressed after a year? Write us your opinion in five sentences at [email protected]. We will publish selected articles with attribution on Thursday in print and online.

Morning Briefing: Alexa

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