Introduction (RA): When Germany, the leading creator of the European Union (the greatest protectionist block in world trade which has spawned, as a reaction against that protectionism, embryo trade blocks in the rest of the world) suddenly attacks its partner in that enterprise (France) and warns of “1930s style” trade wars between such blocks then there must be a real crisis. There must be gross hypocrisy as well. As the article below from our friends at german-foreign-policy.com indicates the lure of German industrial trade with South America and head to head competition with the USA is too important for German industry to be endangered by EU subsidies.
Politically it is also significant that South America represents that very combination of Roman Catholicism, corporatism and émigré Nazis (many aided in their escape to South America after the war by the Vatican’s “ratlines”) which is so palatable to the ruling class in continental Europe. It is ironic therefore that such a trade area should be the instrument which German industry seeks to use to break down that trade protectionism for which the EU has itself been the best example since the 1950s!
As previously indicated on this site we regard the ultimate break-up of the European Union as being an inevitable consequence of the German refusal to finance it. Speaking in the Europe Committee of the German Parliament in Berlin on 21 October the German Chancellor Gerhard Schröder for the first time directly connected the future financing of the EU with the negotiations of a new European Constitution.
Politically the break down will come when Germany is tired of the French swaggering around the world on the back of German industry. The wasteful Common Agricultural Policy stirs German political and economic resentments – but will France act against its farmers and for Latin America? French chauvinism may be as potent against Spanish Latin America as it is against Anglo-Saxon North America! But this trade dispute shows that German industry is beginning – probably with German government support – to object.
BERLIN –
German Business organisations are again demanding a massive cut in EU agricultural subsidies and stirring up the long run conflicts between Berlin and Paris.
In order to conclude the long desired free trade agreement with the South American Trade Alliance, Mercosur, there must be a reduction in those large EU agricultural subsidies (and subsequent dumping- ed) in defence of which the EU caused the collapse of the recent World Trade Organisation negotiations at Cancun. Now German industry is saying that the French Government was responsible and it is time for the EU to “clear out the Augean Stables”.
The German “Latin America Association” regards any further delay in the reduction of EU agricultural subsidies, which to the largest extent benefit France, as a serious threat to Berlin’s economic interests. “Through the initiative of Brasil a block of countries has come into being which represents a credible trade partner for the two great agricultural protectionist powers – the EU and the USA.” Referring to the G21 group which made such an impact at Cancun. “This is the beginning of a dangerous development which requires a swift response.”
Such demands from the influential “Latin America Association” concerned with foreign trade would endanger the present superficial unity of Berlin and Paris. The Franco-German agreement on trade matters was predicated on Germany’s willingness for the time being not to question EU farm subsidies. But there is now in South America a competition between the EU and the USA for free trade agreements with that block, a competition which could seriously damage German companies should the USA make a trade agreement before the EU.
A reduction in EU farm subsidies would also be necessary in order to re-start the stalled WTO talks – which the German Foundation for Science and Politics has specifically demanded. This foreign policy think tank of the German Government tells “international decision makers”, who might not see the true importance of a multilateral trade organisation, that historically it was the consequences of protectionism during the rise of the Nazi movement which led to the Second World War:
“History teaches us that there are parallels to today: in the 1920s as in the 1990s liberalisation and deregulation were propagated: a multilateral organisation the league of Nations established free trade but it did not last long. There soon followed in the 1930s economic protection and the formation of regional blocks”.
Quellen:
Die Welthandelsorganisation nach Cancun; www.swp-berlin.org
Freihandel EU-Mercosur und FTAA bedroht; Pressemitteilung von Peter Rösler, stellvertretender Geschäftsführer des Ibero-Amerika-Vereins 07.10.2003
