Yesterday, EU foreign ministers discussed new sanctions against Russia on the sidelines of the UN General Assembly in New York – a formal proposal is expected next week. It is already clear that reaching an agreement will be difficult, because Hungary is pulling in the completely opposite direction.
Is Social Taxonomy still coming? My colleague Leonie Düngefeld asked Antje Schneeweiß, rapporteur for Social Taxonomy in the responsible working group of the Platform on Sustainable Finance. Her answer was sobering. There is no lack of proposals from her working group, but rather a lack of political will, it seems.
The EU Commission remains reluctant to impose a price cap on gas. Nevertheless, the executive wants to speed up its independence from Russian energy imports and intends to propose new measures before the crisis meeting of energy ministers on September 30. Manuel Berkel has taken a look at everything that is already known about this.
This week’s column by my colleague Claire Stam is about a particular delicacy: the bone of contention. With the Italian election likely to be won by the far-right Fratelli d’Italia, the question is whether a strong right-wing alliance will soon emerge at the EU level. Or is the squabble among the right too great?
Which economic activities are sustainable? From an ecological perspective, the EU has already answered this question – or is in the process of doing so, as it is still fine-tuning some elements of the Environmental Taxonomy. With regard to social sustainability, however, it still owes investors an answer. The Commission originally wanted to deliver within this mandate and propose a social counterpart to the green taxonomy. But now it seems to have shelved the project.
“Right now, there are no particular efforts in the Commission to get a social taxonomy off the ground now,” says Antje Schneeweiß. She is the rapporteur for Social Taxonomy in the competent working group of the Platform on Sustainable Finance, which advises the EU Commission. In February, the platform presented its report with ideas for a Social Taxonomy. By the end of the year, in turn, the Commission actually wanted to prepare its own report based on it – in the meantime, it is unclear whether a proposal will materialize at all in this legislative period.
The reason for this, according to Brussels, is the experience with the Green Taxonomy: The Commission is said to be reluctant to open up another difficult topic in the current mandate after the heated debate on the delegated act on natural gas and nuclear power activities. Moreover, work on the environmental taxonomy is far from finished: The Commission has yet to define four of the six goals formulated in the taxonomy regulation.
The fact that social taxonomy has taken a back seat is due to a lack of political will and the upcoming EU elections, says Thierry Philipponnat, Chief Economist at the NGO Finance Watch. At the same time, he says, a Social Taxonomy is just as important as an Environmental Taxonomy. “Policymakers should have kept the momentum going after the publication of the final report on Social Taxonomy in February and come up with a legislative proposal.”
Joachim Schuster, financial and economic policy spokesman for the Social Democratic Party in the EU Parliament, no longer expects a proposal in this mandate: “This is partly due to the political sensitivity of defining which economic activities make a significant contribution to social goals and do not cause social harm – an even tougher undertaking than with the green taxonomy.”
The Commission does not clearly comment on the matter. In response to a query from Europe.Table, a spokeswoman said the Sustainable Finance Platform report is currently being “carefully analyzed.” As the platform is an independent advisory body, the report does not precede any decision or action by the Commission, she said. The spokeswoman instead referred to “other policy initiatives within the broader sustainable finance framework that promote investments with positive social impacts,” such as the Sustainable Finance Disclosure Regulation, the Supply Chain Law, and even the minimum social standards of the Green Taxonomy.
To a certain degree, Antje Schneeweiß can understand the Commission’s reluctance. “On the other hand, we won’t be able to do without a Social Taxonomy in the long run,” Schneeweiß says. In the long run, there might even arise an imbalance between green and social investments: If banks and asset managers can show green investments positively in their documentation and green asset ratio, but not social ones, there is not just a lack of data on how socially compliant these activities are. In extreme cases, this could even lead to financial flows going more to green than to social. There won’t be a complete turnaround, Schneeweiß explains. “But the one-sided incentivization of environmental issues will not be sustainable in the long run.”
Savings banks that invest in social sectors such as housing, for example, have a strong interest in criteria for social investment. “Globally applicable and recognized definitions of what economic activity is considered socially sustainable would be a great help to investors, lenders, other stakeholders and society as a whole,” explains a spokesperson for the Deutscher Sparkassen- und Giroverband (DSGV). “However, the discussions around the EU taxonomy on environmental sustainability have shown how hard it can be to agree on common standards and how great the risk of creating a bureaucratic monster is.”
Medium-sized companies in particular are worried about further bureaucratic monsters. They are groaning in the face of the huge amounts of data that they will have to collect under the myriad of new EU regulations. However, Antje Schneeweiß believes that lessons can be learned from the mistakes made with the green taxonomy: We now already know which data is truly essential and which is already being requested on the basis of the new sustainability reporting requirements.
In the social sector, there is still considerably less clarity about the criteria for bonds than in the environmental sector, explains Aldo Romani of the European Investment Bank (EIB). “It is a challenge to clarify what social investments are. Because since there have been intense debates about what ‘green investments’ are, people have realized that a lot of green is not green enough after all. That’s why many issuers today are all the more interested in a new classification of their economic activities that also highlights social aspects.”
The working group, led by Antje Schneeweiß, proposes three overarching goals for Social Taxonomy in its report: A humane work environment for laborers along the supply chain, a proper standard of living and well-being for the product’s consumers, and inclusive and sustainable communities and societies. These should be divided into further sub-goals, according to the panel.
The Platform presented two options for the interplay between the Green and Social Taxonomies: In an integrated model, the “Do No Significant Harm” (DNSH) criteria of both taxonomies – according to which the respective economic activity must make a substantial contribution to at least one environmental or social objective and not harm any of the other objectives – would apply jointly to all activities. In the alternative model, the two taxonomies would be linked only by minimum standards. For the Green Taxonomy, the Platform has already presented proposals for minimum social standards.
Initially, it would be easier to work on both taxonomies separately, says Antje Schneeweiß. “The DNSH criteria make a lot of sense, but they are causing quite a few problems with the Environmental Taxonomy right now,” she explains. “That’s why it makes more sense at this point to work with the minimum standards for now and let systems work independently of each other.”
It is unlikely that this will happen at all in the foreseeable future. Some MEPs still want to try to put pressure on the Commission. Joachim Schuster sees hardly any chance in light of the numerous other challenges the EU is currently facing: “This makes it difficult to make progress on long-term projects.” At the same time, the growing demand for socially responsible financial products is “another indication that the Commission should tackle this project sooner rather than later.”
The Commission wants to speed up energy independence and further strengthen cooperation and solidarity between member states, Monika Zsigri, head of the Energy Platform Task Force, announced on Wednesday at an event organized by Eurogas.
The Commission official continued to be reluctant about a price cap on gas, which some member states call for. As President Ursula von der Leyen already announced, the consequences of various measures for the internal market should first be assessed. This assessment had not yet been finalized and therefore no decision had yet been taken on concrete proposals.
As Bloomberg reports, the new Commission plans are also expected to address the initially postponed measures for increased liquidity in energy trading. Due to increased security requirements, trading volumes had decreased, which increases volatility at trading venues. The Commission also wants to “prevent an increase in gas demand,” according to Bloomberg. However, with the heating season approaching, this would be a challenge.
Meanwhile, Poland reiterated its reservations about imposing a uniform price cap on wholesale electricity, as Germany and the Commission are planning. If member states had to skim off revenues above a cap to ease the burden on industry, they would be forced to negotiate with the Commission over subsidies, Adam Guibourge-Czetwertyński, State Secretary at the Ministry of Climate and Environment, told reporters in Warsaw this week. Therefore, Poland was preparing a national law that would directly limit the bidding of various generation technologies.
The government will also take into account the risk that price caps could lead to increased electricity exports to neighboring countries, where prices are higher. However, the ministry considers the risk to be low because there are hardly any electricity surpluses that could be exported. The Polish government has no plans to limit electricity exports, Guibourge-Czetwertyński assured when asked.
Mutual aid is also to be provided in the event of a gas shortage – even though negotiations on a solidarity agreement between Warsaw and Berlin have been stalled for months. “We can support Germany with gas,” a senior Polish government official has recently stated. But this would be a matter of the price, he said, referring to LNG supplies from Qatar, for example.
Poland itself currently struggles to increase gas imports. A floating regasification terminal near Gdansk is not scheduled to go online until late 2027. Until then, however, the capacity of the existing terminal in Swinoujscie is to be increased.
Gas has recently begun to flow from Norway to Poland via the Baltic Pipe, but the PGNiG Group only has contracts for three billion cubic meters (bcm) of gas per year. In total, Baltic Pipe has a capacity of 10 bcm. According to government sources, PGNiG is negotiating additional deliveries. However, Norway has stated that it will not be able to export more gas to the EU in the short term.
Nevertheless, Poland considers itself well-prepared for this winter when it comes to gas supply. Gas plays only a minor role in the energy mix anyway, Guibourge-Czetwertyński said. Poland wants to replace its nuclear power plants with new ones and greatly expand renewable energies in the electricity sector. Renewable capacities are to increase to 50 gigawatts by 2030, including 5.9 gigawatts of offshore wind energy in the Baltic Sea alone.
Europe becomes more and more innovative – Germany, on the other hand, falls behind in comparison. This is one of the findings of the European Innovation Scoreboard (EIS) 2022, which the Directorate-General for Research and Innovation has recently presented. The EIS shows how important it is to create a pan-European innovation strategy, said Mariya Gabriel, Commissioner for Innovation and Research. “The recently adopted New European Innovation Agenda will position Europe at the forefront of the new wave of deep-tech innovations and ensure that innovation reaches all regions of Europe, including rural areas.”
The Innovation Scoreboard has been comparing the innovation performance of EU countries and other countries in the region in a comparative analysis since 2001. Like in the Digital Economy and Society Index (DESI) 2022, Germany is not in the top group in the European Innovation Scoreboard. What is more, it has actually fallen slightly compared to 2021, while 19 member states have improved. Since 2015, innovation performance in the EU as a whole has increased by 10 percent (in Germany by 7.4 percent). This means that Germany’s performance lead over the EU is getting narrower.
The EIS measures innovation performance using various indicators in different dimensions. These include, for example, human capital, attractive research systems, digitization, finance and funding, corporate investment and more. Germany scores a performance of 117.5 percent. Together with Austria, Cyprus, France, Ireland and Luxembourg, it is thus among the strong innovators. This is because the innovation performance of these countries is above the EU average of 114.5 percent.
Germany’s strengths include the number of PhDs, the level of employment in innovative companies and the mobility of researchers. Weaknesses include low government support for research and development in business, an insufficient share of citizens with more than basic digital skills, and inadequate support for lifelong learning.
The international dimension of the innovation scoreboard is also interesting. It shows that global competitors such as South Korea, Australia, Canada and the United States still have a performance advantage over the average of EU countries. However, the EU was able to improve in international comparison and overtook Japan in 2021. vis
According to legend, the wedding of the goddess Thetis and the hero Peleus was the one event that should not be missed. All the gods and goddesses attended, except one: Eris, the goddess of discord, had not been invited. Out of anger and insult, she decided to take revenge by throwing a golden apple – the famous Apple of Discord – with the inscription “For the fair” into the midst of the guests. This act ultimately led to the Trojan War.
If Italy does indeed elect the far-right Fratelli d’Italia (Brothers of Italy) led by Giorgia Meloni on Sunday, it will be the third far-right government in Europe, after Sweden and Fidesz in Hungary. But an alliance of the three governments at the EU level is unlikely, because the positions are too different, discord is far too great.
Even though there is undeniably cause for concern, it should be kept in mind that these political groups are deeply divisive: They still fail to form a homogeneous group in the European Parliament. The ECR Group has 63 MEPs, the ID 70, while the EPP has 179.
Within the fractured European family of the far right, the Russian invasion of Ukraine and its stance toward Moscow may seem reminiscent of the apple in ancient times. Take, for example, the diametrically opposed positions between Poland’s PiS and Orbán’s Fidesz, which helped blow up Visegrád.
“There is no stable alliance between the extreme right-wing parties. You can see this in the European Parliament, where the alliance of the extreme and far-right has still not materialized. There are still major differences on issues such as immigration or Russia,” Eric Maurice, head of the Robert Schuman Foundation’s Brussels office, told Europe.Table.
“Nor will there necessarily be a stable alliance between governments (note: that have extreme right in their ranks). For example, at the level of economic policy, it is not certain that Sweden will support Italy’s demands,” he adds.
A third aspect highlighted by the European policy expert is the formation of the national governments themselves. “In Sweden and Italy, coalition governments will be at work,” meaning a constellation that can lead to potential conflicts within these governments. That means it will be difficult to get a clear position from these countries during negotiations in the EU Council of Ministers, he says. This would complicate decision-making at the EU level.
For all these reasons, the EU expert believes it is unlikely that a new alliance with Sweden, Italy and Hungary will emerge from the ashes of the Visegrád states. But the vacuum left by Mario Draghi’s departure will be deafening. Italy carries weight in the council. The country accounts for 17 percent of the EU’s industrial output, more than any other member state except Germany. In a recent analysis, Teresa Coratella and Arturo Varvelli, both of the think tank ECFR Rome, rub salt into the European wound by recalling that it is thanks to Mario Draghi’s leadership that Italy has “finally” begun to realize its potential by addressing its historic problems.
“He led Italian politics towards full support for Ukraine following the Russian invasion – despite fluctuating public opinion on the issue. Draghi even guided French President Emmanuel Macron and German Chancellor Olaf Scholz through their initial hesitancy to back Ukraine’s bid for EU membership. Furthermore, he played an important role in formulating EU sanctions on Russia – and, as discussed, in Italian and EU energy policy. During the political crisis that would eventually bring down his government, he spent two days in Algiers securing alternatives to Russian gas. This demonstrated a willingness to put the national interest before career that is increasingly rare among Italian politicians,” the authors write.
So Paris and Berlin are losing an important ally. However, the fall of Draghi’s government “is an act of self-harm by his rivals”, the two researchers write, as the former governor of the European Central Bank has left a legacy that will be difficult to dismantle. “Unless populist and Eurosceptic parties take over, Draghi’s political orientation on Russia, Ukraine, transatlantic relations, and the EU will likely survive the difficult times ahead – not least thanks to a lack of credible alternatives.” Not least because of the deep internal schisms among the extreme right and far-right formations.
Yesterday, EU foreign ministers discussed new sanctions against Russia on the sidelines of the UN General Assembly in New York – a formal proposal is expected next week. It is already clear that reaching an agreement will be difficult, because Hungary is pulling in the completely opposite direction.
Is Social Taxonomy still coming? My colleague Leonie Düngefeld asked Antje Schneeweiß, rapporteur for Social Taxonomy in the responsible working group of the Platform on Sustainable Finance. Her answer was sobering. There is no lack of proposals from her working group, but rather a lack of political will, it seems.
The EU Commission remains reluctant to impose a price cap on gas. Nevertheless, the executive wants to speed up its independence from Russian energy imports and intends to propose new measures before the crisis meeting of energy ministers on September 30. Manuel Berkel has taken a look at everything that is already known about this.
This week’s column by my colleague Claire Stam is about a particular delicacy: the bone of contention. With the Italian election likely to be won by the far-right Fratelli d’Italia, the question is whether a strong right-wing alliance will soon emerge at the EU level. Or is the squabble among the right too great?
Which economic activities are sustainable? From an ecological perspective, the EU has already answered this question – or is in the process of doing so, as it is still fine-tuning some elements of the Environmental Taxonomy. With regard to social sustainability, however, it still owes investors an answer. The Commission originally wanted to deliver within this mandate and propose a social counterpart to the green taxonomy. But now it seems to have shelved the project.
“Right now, there are no particular efforts in the Commission to get a social taxonomy off the ground now,” says Antje Schneeweiß. She is the rapporteur for Social Taxonomy in the competent working group of the Platform on Sustainable Finance, which advises the EU Commission. In February, the platform presented its report with ideas for a Social Taxonomy. By the end of the year, in turn, the Commission actually wanted to prepare its own report based on it – in the meantime, it is unclear whether a proposal will materialize at all in this legislative period.
The reason for this, according to Brussels, is the experience with the Green Taxonomy: The Commission is said to be reluctant to open up another difficult topic in the current mandate after the heated debate on the delegated act on natural gas and nuclear power activities. Moreover, work on the environmental taxonomy is far from finished: The Commission has yet to define four of the six goals formulated in the taxonomy regulation.
The fact that social taxonomy has taken a back seat is due to a lack of political will and the upcoming EU elections, says Thierry Philipponnat, Chief Economist at the NGO Finance Watch. At the same time, he says, a Social Taxonomy is just as important as an Environmental Taxonomy. “Policymakers should have kept the momentum going after the publication of the final report on Social Taxonomy in February and come up with a legislative proposal.”
Joachim Schuster, financial and economic policy spokesman for the Social Democratic Party in the EU Parliament, no longer expects a proposal in this mandate: “This is partly due to the political sensitivity of defining which economic activities make a significant contribution to social goals and do not cause social harm – an even tougher undertaking than with the green taxonomy.”
The Commission does not clearly comment on the matter. In response to a query from Europe.Table, a spokeswoman said the Sustainable Finance Platform report is currently being “carefully analyzed.” As the platform is an independent advisory body, the report does not precede any decision or action by the Commission, she said. The spokeswoman instead referred to “other policy initiatives within the broader sustainable finance framework that promote investments with positive social impacts,” such as the Sustainable Finance Disclosure Regulation, the Supply Chain Law, and even the minimum social standards of the Green Taxonomy.
To a certain degree, Antje Schneeweiß can understand the Commission’s reluctance. “On the other hand, we won’t be able to do without a Social Taxonomy in the long run,” Schneeweiß says. In the long run, there might even arise an imbalance between green and social investments: If banks and asset managers can show green investments positively in their documentation and green asset ratio, but not social ones, there is not just a lack of data on how socially compliant these activities are. In extreme cases, this could even lead to financial flows going more to green than to social. There won’t be a complete turnaround, Schneeweiß explains. “But the one-sided incentivization of environmental issues will not be sustainable in the long run.”
Savings banks that invest in social sectors such as housing, for example, have a strong interest in criteria for social investment. “Globally applicable and recognized definitions of what economic activity is considered socially sustainable would be a great help to investors, lenders, other stakeholders and society as a whole,” explains a spokesperson for the Deutscher Sparkassen- und Giroverband (DSGV). “However, the discussions around the EU taxonomy on environmental sustainability have shown how hard it can be to agree on common standards and how great the risk of creating a bureaucratic monster is.”
Medium-sized companies in particular are worried about further bureaucratic monsters. They are groaning in the face of the huge amounts of data that they will have to collect under the myriad of new EU regulations. However, Antje Schneeweiß believes that lessons can be learned from the mistakes made with the green taxonomy: We now already know which data is truly essential and which is already being requested on the basis of the new sustainability reporting requirements.
In the social sector, there is still considerably less clarity about the criteria for bonds than in the environmental sector, explains Aldo Romani of the European Investment Bank (EIB). “It is a challenge to clarify what social investments are. Because since there have been intense debates about what ‘green investments’ are, people have realized that a lot of green is not green enough after all. That’s why many issuers today are all the more interested in a new classification of their economic activities that also highlights social aspects.”
The working group, led by Antje Schneeweiß, proposes three overarching goals for Social Taxonomy in its report: A humane work environment for laborers along the supply chain, a proper standard of living and well-being for the product’s consumers, and inclusive and sustainable communities and societies. These should be divided into further sub-goals, according to the panel.
The Platform presented two options for the interplay between the Green and Social Taxonomies: In an integrated model, the “Do No Significant Harm” (DNSH) criteria of both taxonomies – according to which the respective economic activity must make a substantial contribution to at least one environmental or social objective and not harm any of the other objectives – would apply jointly to all activities. In the alternative model, the two taxonomies would be linked only by minimum standards. For the Green Taxonomy, the Platform has already presented proposals for minimum social standards.
Initially, it would be easier to work on both taxonomies separately, says Antje Schneeweiß. “The DNSH criteria make a lot of sense, but they are causing quite a few problems with the Environmental Taxonomy right now,” she explains. “That’s why it makes more sense at this point to work with the minimum standards for now and let systems work independently of each other.”
It is unlikely that this will happen at all in the foreseeable future. Some MEPs still want to try to put pressure on the Commission. Joachim Schuster sees hardly any chance in light of the numerous other challenges the EU is currently facing: “This makes it difficult to make progress on long-term projects.” At the same time, the growing demand for socially responsible financial products is “another indication that the Commission should tackle this project sooner rather than later.”
The Commission wants to speed up energy independence and further strengthen cooperation and solidarity between member states, Monika Zsigri, head of the Energy Platform Task Force, announced on Wednesday at an event organized by Eurogas.
The Commission official continued to be reluctant about a price cap on gas, which some member states call for. As President Ursula von der Leyen already announced, the consequences of various measures for the internal market should first be assessed. This assessment had not yet been finalized and therefore no decision had yet been taken on concrete proposals.
As Bloomberg reports, the new Commission plans are also expected to address the initially postponed measures for increased liquidity in energy trading. Due to increased security requirements, trading volumes had decreased, which increases volatility at trading venues. The Commission also wants to “prevent an increase in gas demand,” according to Bloomberg. However, with the heating season approaching, this would be a challenge.
Meanwhile, Poland reiterated its reservations about imposing a uniform price cap on wholesale electricity, as Germany and the Commission are planning. If member states had to skim off revenues above a cap to ease the burden on industry, they would be forced to negotiate with the Commission over subsidies, Adam Guibourge-Czetwertyński, State Secretary at the Ministry of Climate and Environment, told reporters in Warsaw this week. Therefore, Poland was preparing a national law that would directly limit the bidding of various generation technologies.
The government will also take into account the risk that price caps could lead to increased electricity exports to neighboring countries, where prices are higher. However, the ministry considers the risk to be low because there are hardly any electricity surpluses that could be exported. The Polish government has no plans to limit electricity exports, Guibourge-Czetwertyński assured when asked.
Mutual aid is also to be provided in the event of a gas shortage – even though negotiations on a solidarity agreement between Warsaw and Berlin have been stalled for months. “We can support Germany with gas,” a senior Polish government official has recently stated. But this would be a matter of the price, he said, referring to LNG supplies from Qatar, for example.
Poland itself currently struggles to increase gas imports. A floating regasification terminal near Gdansk is not scheduled to go online until late 2027. Until then, however, the capacity of the existing terminal in Swinoujscie is to be increased.
Gas has recently begun to flow from Norway to Poland via the Baltic Pipe, but the PGNiG Group only has contracts for three billion cubic meters (bcm) of gas per year. In total, Baltic Pipe has a capacity of 10 bcm. According to government sources, PGNiG is negotiating additional deliveries. However, Norway has stated that it will not be able to export more gas to the EU in the short term.
Nevertheless, Poland considers itself well-prepared for this winter when it comes to gas supply. Gas plays only a minor role in the energy mix anyway, Guibourge-Czetwertyński said. Poland wants to replace its nuclear power plants with new ones and greatly expand renewable energies in the electricity sector. Renewable capacities are to increase to 50 gigawatts by 2030, including 5.9 gigawatts of offshore wind energy in the Baltic Sea alone.
Europe becomes more and more innovative – Germany, on the other hand, falls behind in comparison. This is one of the findings of the European Innovation Scoreboard (EIS) 2022, which the Directorate-General for Research and Innovation has recently presented. The EIS shows how important it is to create a pan-European innovation strategy, said Mariya Gabriel, Commissioner for Innovation and Research. “The recently adopted New European Innovation Agenda will position Europe at the forefront of the new wave of deep-tech innovations and ensure that innovation reaches all regions of Europe, including rural areas.”
The Innovation Scoreboard has been comparing the innovation performance of EU countries and other countries in the region in a comparative analysis since 2001. Like in the Digital Economy and Society Index (DESI) 2022, Germany is not in the top group in the European Innovation Scoreboard. What is more, it has actually fallen slightly compared to 2021, while 19 member states have improved. Since 2015, innovation performance in the EU as a whole has increased by 10 percent (in Germany by 7.4 percent). This means that Germany’s performance lead over the EU is getting narrower.
The EIS measures innovation performance using various indicators in different dimensions. These include, for example, human capital, attractive research systems, digitization, finance and funding, corporate investment and more. Germany scores a performance of 117.5 percent. Together with Austria, Cyprus, France, Ireland and Luxembourg, it is thus among the strong innovators. This is because the innovation performance of these countries is above the EU average of 114.5 percent.
Germany’s strengths include the number of PhDs, the level of employment in innovative companies and the mobility of researchers. Weaknesses include low government support for research and development in business, an insufficient share of citizens with more than basic digital skills, and inadequate support for lifelong learning.
The international dimension of the innovation scoreboard is also interesting. It shows that global competitors such as South Korea, Australia, Canada and the United States still have a performance advantage over the average of EU countries. However, the EU was able to improve in international comparison and overtook Japan in 2021. vis
According to legend, the wedding of the goddess Thetis and the hero Peleus was the one event that should not be missed. All the gods and goddesses attended, except one: Eris, the goddess of discord, had not been invited. Out of anger and insult, she decided to take revenge by throwing a golden apple – the famous Apple of Discord – with the inscription “For the fair” into the midst of the guests. This act ultimately led to the Trojan War.
If Italy does indeed elect the far-right Fratelli d’Italia (Brothers of Italy) led by Giorgia Meloni on Sunday, it will be the third far-right government in Europe, after Sweden and Fidesz in Hungary. But an alliance of the three governments at the EU level is unlikely, because the positions are too different, discord is far too great.
Even though there is undeniably cause for concern, it should be kept in mind that these political groups are deeply divisive: They still fail to form a homogeneous group in the European Parliament. The ECR Group has 63 MEPs, the ID 70, while the EPP has 179.
Within the fractured European family of the far right, the Russian invasion of Ukraine and its stance toward Moscow may seem reminiscent of the apple in ancient times. Take, for example, the diametrically opposed positions between Poland’s PiS and Orbán’s Fidesz, which helped blow up Visegrád.
“There is no stable alliance between the extreme right-wing parties. You can see this in the European Parliament, where the alliance of the extreme and far-right has still not materialized. There are still major differences on issues such as immigration or Russia,” Eric Maurice, head of the Robert Schuman Foundation’s Brussels office, told Europe.Table.
“Nor will there necessarily be a stable alliance between governments (note: that have extreme right in their ranks). For example, at the level of economic policy, it is not certain that Sweden will support Italy’s demands,” he adds.
A third aspect highlighted by the European policy expert is the formation of the national governments themselves. “In Sweden and Italy, coalition governments will be at work,” meaning a constellation that can lead to potential conflicts within these governments. That means it will be difficult to get a clear position from these countries during negotiations in the EU Council of Ministers, he says. This would complicate decision-making at the EU level.
For all these reasons, the EU expert believes it is unlikely that a new alliance with Sweden, Italy and Hungary will emerge from the ashes of the Visegrád states. But the vacuum left by Mario Draghi’s departure will be deafening. Italy carries weight in the council. The country accounts for 17 percent of the EU’s industrial output, more than any other member state except Germany. In a recent analysis, Teresa Coratella and Arturo Varvelli, both of the think tank ECFR Rome, rub salt into the European wound by recalling that it is thanks to Mario Draghi’s leadership that Italy has “finally” begun to realize its potential by addressing its historic problems.
“He led Italian politics towards full support for Ukraine following the Russian invasion – despite fluctuating public opinion on the issue. Draghi even guided French President Emmanuel Macron and German Chancellor Olaf Scholz through their initial hesitancy to back Ukraine’s bid for EU membership. Furthermore, he played an important role in formulating EU sanctions on Russia – and, as discussed, in Italian and EU energy policy. During the political crisis that would eventually bring down his government, he spent two days in Algiers securing alternatives to Russian gas. This demonstrated a willingness to put the national interest before career that is increasingly rare among Italian politicians,” the authors write.
So Paris and Berlin are losing an important ally. However, the fall of Draghi’s government “is an act of self-harm by his rivals”, the two researchers write, as the former governor of the European Central Bank has left a legacy that will be difficult to dismantle. “Unless populist and Eurosceptic parties take over, Draghi’s political orientation on Russia, Ukraine, transatlantic relations, and the EU will likely survive the difficult times ahead – not least thanks to a lack of credible alternatives.” Not least because of the deep internal schisms among the extreme right and far-right formations.
