FIRST, SOME SOLID INTEL:
Germany’s Showdown for the Exit Strategy From the Corona Virus Shutdown
This Wednesday, Germany might face a good old-fashioned, Western-style showdown in its discussion for an exit-strategy. In the meeting of “Bund und Länder” (transl. Federal Government and State Governments), the Federal Government will discuss with the States’ Prime Ministers on how a loosening of the restrictive measures in Germany could look like. Germany’s neighbor Austria has already decided to start loosening just after Easter, while Angela Merkel so far has been unwilling to announce a precise exit date. On Wednesday, her biggest opponent will be North-Rhine Westphalia’s Prime Minister Armin Laschet, meaning Merkel will face opposition from her own party – again. Laschet, who has been advocating for a discussion about a possible exit strategy for a couple of days already, submitted a paper on further proceedings, drafted by an interdisciplinary expert group of his government.
In Germany, experts from different professions as well as politicians are discordant on how to move forward. As of today, the restrictive measures would be in place until at least 19 April, with Merkel politely brushing off any plans for an earlier loosening or for how to continue after this date. People in Germany are hoping for some positive news on Wednesday in order to move forward.
New German foreign trade and payments act – Germany using Trump-methods?
Germany aims to finalize an approach to renew its foreign trade legislation, a process that started already some time before Corona. After the experience of the Financial and the Euro Crisis (when foreign investors were happy to buy out German companies the state could not provide with enough liquidity), Germany is tightening its rules for M&A activities by companies outside of the EU in areas of critical infrastructure.
What does that mean? Currently, the Federal Government, if it wanted to stop a foreign buyout, has to prove there is an “actual threat” of public security. With the new law, they will only have to show that there could be a “probable impairment”.
Germany is implementing EU guidelines with this law, however, it is also being guided by a lesson learned in regard to its 50 hertz grid, when it prevented a Chinese buyout in the latest moment possible. The new law therefore reflects the wish of the EU, and especially of Germany and France, to gain more technological independence and control over their domestic markets. Germany is letting protectionist measures come back in its legislation in a way that might even make President Trump happy.
No coffee or beer in Berlin after the crisis?
Helping the companies in Germany is mostly “Ländersache”, meaning the States are kindly asked to develop their own programs. For SMEs with up to 10 employees, there is a basic support of non-refundable money from the Federal Government. Most States extended this program with their own resources to help companies with more than 10 employees. Only the capital itself does not want to do that and only offers guaranteed loans. This might be a bad decision, since Berlin is not only the political center of Germany but also has a strong SME business sector. Those enterprises are now at risk, and some of your favorite hipster coffee shops in Kreuzberg might not exist after the crisis if Berlin doesn’t provide some support as other states are doing.
If you want more, for example about Corona-Bonds, Transportation regulation and what the heck is going on in Sweden, click here and download the PDF.
WHAT’S ON OUR MINDS TODAY:
Science or politics?
That escalated slowly. Science acts for the common good while politicians act only for their own interest, so the eternal public verdict.
But public affairs pros know: It’s not that easy. When deciding on how to act on Corona, first it was “science against politics”, then it was “female leaders against male leaders”, in east EU some claim “hard leadership saves more lives than consensus democracies”. Today we are at: Scientist against scientist.
What happened? Chancellor Merkel follows her virologists’ advice, the most prominent from Robert Koch Institute and also Christian Drosten, who not only developed the first Coronavirus test kit, but was dubbed by some media “Germany’s corona-explainer-in-chief”. They suggested to shut down the whole republic before making a mistake, an action supported by the public.
Enters the scene: Hendrick Streeck, Chief Virologist Counsel of Armin Laschet, Prime Minister of the biggest state in Germany Northrhine Westphalia. After a study he conducted in the most affected area in Germany, testing hundreds of inhabitants for anti-bodies, he concluded that the way forward is extreme-testing and shutdowns only in highly affected areas, while moving on with business as usual in the rest of Germany.
“Great stuff, let the summer begin!”, says the public.
“No!” says Merkel.
Drosten goes “Let me see your study!”
“No!” says Streeck, giving a press-statement instead, without disclosing details on his data.
Now, Drosten is like:
And Streeck is like:
And now we all know: It’s not that easy. There is no science vs. science or science vs. politics only cognition vs. cognition and decision vs. decision.
It is not only about “facts”, sometimes it is about weighing the facts for a prognosis-baseddecision that politicians cannot make alone. Alternative facts come to mind, and at least for journalists those are a feast.
To wrap it up: If you want to learn how Germany will decide, mark your calendar for this Wednesday’s discussion. But PA pros know: It still won’t be easy.