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Where will we be in six months? We’ll know how European economic experts predict the future later this morning, when the latest economic sentiment indicator from the Mannheim-based Zew institute is released.
The closely watched index will provide major clues into how likely a German economic recovery really is – or whether Germany will tip into a recession and continue to be a drag on the eurozone.
The German index fell last month for the first time in a year, suggesting a worsening outlook, while the analysts also became less optimistic about the future of the EU economy. The bloc’s GDP increased in the second quarter of 2024 perhaps in spite of Germany, which saw a 0.1 percent monthly GDP decline thanks to weak investment.
The good news from last month’s survey: About half of the experts surveyed still expected the European economy to improve within six months, and few predicted inflation will get worse.
Even as Germany remains the eurozone’s “weak link,” it is still the largest net contributor to the EU budget, paying €17.4 billion more than it receives, as János Allenbach-Ammann reports below.
We can’t predict the future, but we sure hope you have a great day.
The energy companies RWE and Gasunie may have to forgo €40 million in subsidies from the German government for the planned liquefied natural gas terminal in Brunsbüttel. The companies behind the rival project in Stade have taken legal action against the EU Commission before the European Court of Justice (ECJ) and want to have the approval of the subsidies declared null and void. The action was filed on June 18 (Case T-309/24).
The plaintiffs’ accusations are ultimately directed against the German government. “The aid leads to significant distortions of competition on the market for LNG import terminals and on the downstream wholesale gas market,” the court’s summary states. The plaintiff is Hanseatic Energy Hub, which is building the facility in Stade.
In March 2022, the German government announced that it would acquire a half stake in the Brunsbüttel-based operating company German LNG Terminal via KfW. Gasunie and RWE hold the remaining 40 and ten percent respectively. The land-based terminal is set to replace the floating FSRU by 2027 at the latest and further secure Germany’s supply of natural gas.
According to the accusation made by Hanseatic Energy Hub – a joint venture of industrial, energy and financial companies – the operators “charged prices that were considerably too low” for the terminal capacity booking contracts. “A normal economic operator would have calculated with significantly higher expected returns and accordingly demanded higher prices from its customers. This would have closed the financing gap and the terminal could have been built without state aid.”
According to the plaintiffs, a price increase of just two percent for capacity bookings would have been enough to close the financing gap. In addition, the Commission’s competition authorities had not carried out a formal investigation.
The EU Commission approved a preferential dividend for the private shareholders in July 2023. “The annual return on the project will thus accrue exclusively to the shareholders Gasunie and RWE up to a fixed limit,” wrote the Federal Ministry for Economic Affairs and Energy. Over a term of 15 years, this is expected to raise €40 million. The BMWK had apparently deliberately chosen this approach in order to avoid any doubts regarding state aid.
“The specifics of the special aid mechanism ensure that, in my preliminary assessment, it is definitely a construction that can be approved,” says Speyer-based European law expert Wolfgang Weiß. The complaint does not go into these specifics enough. The expert also considers the plaintiffs’ arguments regarding the “implausible calculation of the amount of aid” to be “not very conclusive”: “The mere fact that a public bank is involved does not in itself constitute aid, at least according to the prevailing opinion.”
It is also questionable whether the operators of the Stade terminal are even entitled to bring an action. “Competitors of aid recipients must meet very high requirements in order to be able to credibly demonstrate that they are personally and directly affected by the decision: To do so, a significant impact on their competitive relationship must be demonstrated,” explains Weiß. What’s more, even if the plaintiffs were successful, the Commission could still approve the aid with an adjusted justification.
The energy consultancy Enervis has doubts about the substance of the complaint. The Brunsbüttel operators had already announced the conclusion of contracts at the end of 2022 – with the mineral oil company Conoco Phillips, the chemical company Ineos and RWE Supply & Trading, says consultant Sebastian Triebsch. “Since the aid for the construction of the terminal was not discussed until 2023 and approved by the EU Commission in July 2023, it is currently not apparent that German LNG offered the capacity booking contracts at prices that were not in line with the market and took the aid into account in its calculations.”
The capacity costs generally only account for a marginal share of the total LNG costs, explains the gas expert. The terminal is also too small to expect massive competitive effects on the terminal market or wholesale gas trading. And another factor, which climate protectionists have repeatedly warned about, makes the market power appear small. Triebsch: “Based on the capacity utilization of German terminals and consumption trends, we cannot assume full capacity utilization as things stand today.”
Religion plays a major role in André Ventura’s life. As a teenager, he attended a Catholic seminary. Inflicting pain on himself with a penance belt was part of his spiritual experience. Although he left the seminary to become a lawyer and later a politician, his relationship with politics is still tinged with religion. The leader and founder of the Chega party claims that God has entrusted him with the “task of changing Portugal.” In order to fulfill this task, Ventura believes that nationalist and ultra-right-wing politics are obviously needed.
André Claro Amaral Ventura was born in 1983 in Sintra, a small town in the Lisbon metropolitan area. His family did not have him baptized, he decided to become a Catholic on his own at the age of 14, joined a Christian youth group, began reading religious literature and interpreting the Bible to the letter. When he fell in love, he swapped his life as a clergyman for a career in law. But Ventura says: “I left the seminary, but the seminary didn’t leave me.” He completed his law degree at the Universidade Nova de Lisboa and went on to gain a doctorate in public law at the University of Cork (Ireland).
Ventura began his political career in the center-right Partido Social Democrata (PSD) party. In the 2017 local elections, he was elected as a councillor for the PSD in the municipality of Loures. In addition to his political career as a councillor, he also made a name for himself as a sports commentator for his soccer club Benfica and as a columnist for the tabloid Correio da Manhã. In his opinion pieces, Ventura spoke out in favor of the chemical castration of pedophiles, for example.
However, his controversial positions on immigration and minorities as well as differences with the PSD led to him leaving the party in 2018.
In 2019, Ventura founded the Chega party, which translates as “Enough is enough.” The name is derived from an internal movement that Ventura launched in 2018 to topple the then PSD President Rui Rio (“Chega Rui Rio”). In just five years, Chega has gone from a 1.3 percent share of the vote (2019) to the third strongest political force with 18 percent of the vote in the parliamentary elections in March of this year. In the European elections in June , Chega achieved just under 10 percent of the vote.
Chega defines itself as a “conservative, liberal and nationalist” party, with the rejection of immigration being one of its most important foundations. Its founding manifesto states: “Chega is a nationalist party because it understands the nation as a community of blood, land, property and destiny that unites people with historical, cultural and linguistic ties.”
Ventura and his party focus their anti-immigration discourse on Roma and Muslims, but spare Brazilians, of whom around 240,000 live in Portugal – the largest group of foreigners in the country. Chega is against social aid measures for minorities and immigrants and demands life imprisonment for rapists and murderers. “The people rule, not the elites who rule us” is the phrase that Ventura has used as a mantra in every campaign and election since founding Chega in April 2019. “Clean up Portugal” (“Limpar Portugal”) was this year’s slogan for the parliamentary elections. The aim was to rid the country of its “corrupt elites.”
However, not all influential Portuguese people incur Ventura’s wrath – he is obviously close to some of them. Chega is supported by members of powerful business families, such as the Mello family, owners of wine companies and the third richest family in Portugal, and the Champalimaud clan, owners of the Oitavos hotels.
André Ventura has managed to win the votes of outraged Portuguese, but also of ultra-conservatives and right-wing extremists who have found a political home with him. But not only that. In a report, the daily newspaper “Publico” notes that even former supporters of the communists support the Chega party.
The Chega leader is not bothered by his party being labeled “far-right”. “Today we live in a country where anyone who defends Portuguese people who pay their taxes and don’t live off the system is branded a fascist,” Ventura said in an interview in 2021. That same year, Chega took up the motto of António Salazar’s dictatorship: “God, country, family and work”. “I’m not a Salazarist, and neither is the party, but these are good values to guide society,” Ventura said at the time. isabel cuesta
Where will we be in six months? We’ll know how European economic experts predict the future later this morning, when the latest economic sentiment indicator from the Mannheim-based Zew institute is released.
The closely watched index will provide major clues into how likely a German economic recovery really is – or whether Germany will tip into a recession and continue to be a drag on the eurozone.
The German index fell last month for the first time in a year, suggesting a worsening outlook, while the analysts also became less optimistic about the future of the EU economy. The bloc’s GDP increased in the second quarter of 2024 perhaps in spite of Germany, which saw a 0.1 percent monthly GDP decline thanks to weak investment.
The good news from last month’s survey: About half of the experts surveyed still expected the European economy to improve within six months, and few predicted inflation will get worse.
Even as Germany remains the eurozone’s “weak link,” it is still the largest net contributor to the EU budget, paying €17.4 billion more than it receives, as János Allenbach-Ammann reports below.
We can’t predict the future, but we sure hope you have a great day.
The energy companies RWE and Gasunie may have to forgo €40 million in subsidies from the German government for the planned liquefied natural gas terminal in Brunsbüttel. The companies behind the rival project in Stade have taken legal action against the EU Commission before the European Court of Justice (ECJ) and want to have the approval of the subsidies declared null and void. The action was filed on June 18 (Case T-309/24).
The plaintiffs’ accusations are ultimately directed against the German government. “The aid leads to significant distortions of competition on the market for LNG import terminals and on the downstream wholesale gas market,” the court’s summary states. The plaintiff is Hanseatic Energy Hub, which is building the facility in Stade.
In March 2022, the German government announced that it would acquire a half stake in the Brunsbüttel-based operating company German LNG Terminal via KfW. Gasunie and RWE hold the remaining 40 and ten percent respectively. The land-based terminal is set to replace the floating FSRU by 2027 at the latest and further secure Germany’s supply of natural gas.
According to the accusation made by Hanseatic Energy Hub – a joint venture of industrial, energy and financial companies – the operators “charged prices that were considerably too low” for the terminal capacity booking contracts. “A normal economic operator would have calculated with significantly higher expected returns and accordingly demanded higher prices from its customers. This would have closed the financing gap and the terminal could have been built without state aid.”
According to the plaintiffs, a price increase of just two percent for capacity bookings would have been enough to close the financing gap. In addition, the Commission’s competition authorities had not carried out a formal investigation.
The EU Commission approved a preferential dividend for the private shareholders in July 2023. “The annual return on the project will thus accrue exclusively to the shareholders Gasunie and RWE up to a fixed limit,” wrote the Federal Ministry for Economic Affairs and Energy. Over a term of 15 years, this is expected to raise €40 million. The BMWK had apparently deliberately chosen this approach in order to avoid any doubts regarding state aid.
“The specifics of the special aid mechanism ensure that, in my preliminary assessment, it is definitely a construction that can be approved,” says Speyer-based European law expert Wolfgang Weiß. The complaint does not go into these specifics enough. The expert also considers the plaintiffs’ arguments regarding the “implausible calculation of the amount of aid” to be “not very conclusive”: “The mere fact that a public bank is involved does not in itself constitute aid, at least according to the prevailing opinion.”
It is also questionable whether the operators of the Stade terminal are even entitled to bring an action. “Competitors of aid recipients must meet very high requirements in order to be able to credibly demonstrate that they are personally and directly affected by the decision: To do so, a significant impact on their competitive relationship must be demonstrated,” explains Weiß. What’s more, even if the plaintiffs were successful, the Commission could still approve the aid with an adjusted justification.
The energy consultancy Enervis has doubts about the substance of the complaint. The Brunsbüttel operators had already announced the conclusion of contracts at the end of 2022 – with the mineral oil company Conoco Phillips, the chemical company Ineos and RWE Supply & Trading, says consultant Sebastian Triebsch. “Since the aid for the construction of the terminal was not discussed until 2023 and approved by the EU Commission in July 2023, it is currently not apparent that German LNG offered the capacity booking contracts at prices that were not in line with the market and took the aid into account in its calculations.”
The capacity costs generally only account for a marginal share of the total LNG costs, explains the gas expert. The terminal is also too small to expect massive competitive effects on the terminal market or wholesale gas trading. And another factor, which climate protectionists have repeatedly warned about, makes the market power appear small. Triebsch: “Based on the capacity utilization of German terminals and consumption trends, we cannot assume full capacity utilization as things stand today.”
Religion plays a major role in André Ventura’s life. As a teenager, he attended a Catholic seminary. Inflicting pain on himself with a penance belt was part of his spiritual experience. Although he left the seminary to become a lawyer and later a politician, his relationship with politics is still tinged with religion. The leader and founder of the Chega party claims that God has entrusted him with the “task of changing Portugal.” In order to fulfill this task, Ventura believes that nationalist and ultra-right-wing politics are obviously needed.
André Claro Amaral Ventura was born in 1983 in Sintra, a small town in the Lisbon metropolitan area. His family did not have him baptized, he decided to become a Catholic on his own at the age of 14, joined a Christian youth group, began reading religious literature and interpreting the Bible to the letter. When he fell in love, he swapped his life as a clergyman for a career in law. But Ventura says: “I left the seminary, but the seminary didn’t leave me.” He completed his law degree at the Universidade Nova de Lisboa and went on to gain a doctorate in public law at the University of Cork (Ireland).
Ventura began his political career in the center-right Partido Social Democrata (PSD) party. In the 2017 local elections, he was elected as a councillor for the PSD in the municipality of Loures. In addition to his political career as a councillor, he also made a name for himself as a sports commentator for his soccer club Benfica and as a columnist for the tabloid Correio da Manhã. In his opinion pieces, Ventura spoke out in favor of the chemical castration of pedophiles, for example.
However, his controversial positions on immigration and minorities as well as differences with the PSD led to him leaving the party in 2018.
In 2019, Ventura founded the Chega party, which translates as “Enough is enough.” The name is derived from an internal movement that Ventura launched in 2018 to topple the then PSD President Rui Rio (“Chega Rui Rio”). In just five years, Chega has gone from a 1.3 percent share of the vote (2019) to the third strongest political force with 18 percent of the vote in the parliamentary elections in March of this year. In the European elections in June , Chega achieved just under 10 percent of the vote.
Chega defines itself as a “conservative, liberal and nationalist” party, with the rejection of immigration being one of its most important foundations. Its founding manifesto states: “Chega is a nationalist party because it understands the nation as a community of blood, land, property and destiny that unites people with historical, cultural and linguistic ties.”
Ventura and his party focus their anti-immigration discourse on Roma and Muslims, but spare Brazilians, of whom around 240,000 live in Portugal – the largest group of foreigners in the country. Chega is against social aid measures for minorities and immigrants and demands life imprisonment for rapists and murderers. “The people rule, not the elites who rule us” is the phrase that Ventura has used as a mantra in every campaign and election since founding Chega in April 2019. “Clean up Portugal” (“Limpar Portugal”) was this year’s slogan for the parliamentary elections. The aim was to rid the country of its “corrupt elites.”
However, not all influential Portuguese people incur Ventura’s wrath – he is obviously close to some of them. Chega is supported by members of powerful business families, such as the Mello family, owners of wine companies and the third richest family in Portugal, and the Champalimaud clan, owners of the Oitavos hotels.
André Ventura has managed to win the votes of outraged Portuguese, but also of ultra-conservatives and right-wing extremists who have found a political home with him. But not only that. In a report, the daily newspaper “Publico” notes that even former supporters of the communists support the Chega party.
The Chega leader is not bothered by his party being labeled “far-right”. “Today we live in a country where anyone who defends Portuguese people who pay their taxes and don’t live off the system is branded a fascist,” Ventura said in an interview in 2021. That same year, Chega took up the motto of António Salazar’s dictatorship: “God, country, family and work”. “I’m not a Salazarist, and neither is the party, but these are good values to guide society,” Ventura said at the time. isabel cuesta