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Europe’s ‘illiberal democracies” issue

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Andrzej Duda, president of Poland’s Law and Justice Party (PiS), made a very harsh statement on the long-debated issue of releasing funds for covid recovery. Duda said he would no longer respond to proposals from the European Commission, taking all the necessary steps for the relevant fund. The Polish leader went even further, claiming that a group of “left-wing liberal” politicians in Brussels wanted a government change in the country.

The recovery fund that Brussels had allocated to Poland was around 36 billion euros, but this money had not been in Warsaw’s hands for a long time on the grounds that it had not follow “supremacy of law”. Poland’s plan was finally approved; European Commission President Ursula von der Leyen again made the provision of money conditional on “reform”.

In November last year, the European Commission froze 100m euros in EU funding to Poland over Warsaw’s refusal to comply with a decision by the EU to end the activities of the Polish Disciplinary Service. On 15 July, the PİS government made amendments to the law on the Supreme Court and terminated the running of the disciplinary board. Established in 2017, the Disciplinary Chamber was presented by the government as a judicial reform. The chamber was viewed by the opposition and the EU as a way of intimidating independent judges that go against the government. The agency had no legal identity, which was approved by both the Polish Constitutional Court and the ECHR. The EU had even started fining Poland 1m euros per day for the chamber. Upon this, Duda decided to close the chamber and establish the “Professional Chamber of Responsibility”. According to the opponents, it was just a variation of the same thing.

Poland as leader of the ‘rebellion‘ against Brussels

Founded in the early 2000s, Poland’s ruling party, PİS, has become one of the most important representatives of the political position in Europe, now called “right-wing populist”, over the years. At first, it was thought that there would be a standard “Christian Democrat” party, and it was also on good terms with the Catholic Church. After the election victory in 2015, criticism rose both inside and outside: PİS was attacking Poland’s “democratic institutions”, acting against the rule of law, interfering with the Constitutional Court, restricting human rights and freedoms and increasing the country’s debt. In summary, the PİS administration was in contradiction with the “Round Table Talks” that emerged in the 1980s and that governments generally  attuned with after the dissolution of socialism.

What was that consensus? We can summarize it under four headings: first, democratization and decentralization; second, the “inefficiency” of the socialist economy and, as a remedy, the process of transition to a fast free-market capitalist economy in which private ownership would be central; third, -related to the second one- the acceptance of the “bitter prescription” and austerity policies under IMF and World Bank supervision; and fourth, good relations with the US in foreign policy, integration into EU mechanisms, and NATO membership were the constant principles.

Pre-PİS governments had complied unquestioningly with a harsh privatisation programme and IMF-World Bank-based neoliberal offensive policies. The reform process, initiated in 1997 following the Shock Therapy in the early 1990s, placed the neoliberal agenda and led to a serious decline in the living standards of millions of Poles.

It was under these circumstances that the march of PİS, which started with the coalition in 2005 and ended with power alone in 2015, began. PİS, who was tougher on anti-communism and Russian hostility than its predecessors, appeared before voters in the 2015 elections with the promise of deviation from neoliberal testament under the name of “economic patriotism”. In this context, in addition to reducing the power of banks and multinational companies, a “social transfer” campaign, which had not been seen since 1989, was also put forward: lowering the retirement age, financial support for families with more than one child, tax regulation and hourly minimum wage. This was accompanied by cultural policies such as objection to the law that frees gay marriages, criticism of the EU’s migration and multiculturalism policy, strengthening the nation-state system and protection of Christian values. Not to mention changing the street names that are related to communism from the period of the People’s Republic of Poland, they were such hostile as to change street names from Poland’s socialist traditions.

Indeed, Warsaw’s flag of rebellion against Brussels is marked by an ideological slur that identify with fascism, communism and the LGBT, and underlines the opposition to all of this. At this point, it should be stated that in the overthrow of the first PİS power (2005-2007), the urban-educated professional layers had a significant role, who believed that harsh neoliberalism was still beneficial to them and that they would prosper. The group consisted of people who took out a loan and bought a house, took out private health insurance to get rid of Poland’s poor health system, went to private schools or sent their children there. The eurozone crisis has crashed the hopes of these segments as well. Poland, whose economy has been growing steadily since the fall of communism, reached its peak in the 2000s, was entering the 2010s with an economic slowdown. Those who sent PİS with a tin can tied to its tail were printing two seals on its “national capitalism” in 2015.

This is the source of the tension between the EU and Poland. This is the Poland’s motivation  behind the demand of $1.26 trillion in compensation from Germany due to World War II. The Polish leadership is driven by the equation “Germany equals the EU”. This situation, combined with anti-Russianism, gives Warsaw an interesting field of action: the anti-Russian Anglo-American alliance, together with the Baltic countries, assigns a special role to Poland. Moreover, Britain, which has left the EU, wants to consolidate a non-EU Eastern European alliance system that includes Poland.[1] This being the case, Poland can raise its voice against both Russia and Germany.

Raising the voice might be a bit of an understatement: PİS leader Jarosław Kaczyński said last August that there was a German-Russian plan designed to rule Europe, and that Poland did not follow it. Kaczyński argued that the Polish opposition also acted in accordance with this plan and wanted to make the country “obedient to neighbouring powers”. Whereas last year, it was him last year who caused eyebrows to raise, saying that the EU had become the “Fourth German Reich”. Justice Minister Zbigniew Ziobro recently went further and argued that Germany wanted a “colonial government” in Poland.

 Hungary seeks reconciliation

Another “illiberal” country that an issue for Brussels is Hungary. Following his 54.13% election victory last April, Fidesz leader Viktor Orban referred to the EU headquarters, saying his victories were visible from the Moon, even from Brussels. Orban also explained who they had won the victory against: the Leftists, the bureaucrats in Brussels, George Soros, the international mainstream media, and even the President of Ukraine.

In 2014, Orban said his goal was “to build an illiberal democracy based on national institutions”. According to Orban, the 2008 global economic crisis showed that liberal democratic states were not globally competitive. The Hungarian leader said he wants to transform “welfare societies” into “employment/working societies” and previously stated that central control should increase in order to cope with energy companies and banks. Orban was struggling to get rid of “debt slavery” and not to make Hungary a “colony of the EU”. What he meant was abandoning the liberal way of looking at the world in order to put society in order.

However, it seems that Orban, who riveted his power, wants to make a fresh start with Germany. Fidesz leader Olaf Scholz, who left for Berlin in October, met with Germany’s new chancellor last year. Afterwards, although Orban described the meeting as “productive”, it was noteworthy that a joint press conference was not held.

Although it is understandable that the traffic light coalition in Germany does not want to side with Orban, it seems that both countries are now sending the message of “unity”. Hungary, like Poland, faces the threat of halting the European Commission’s pandemic recovery funds. The release of funds, which will be decided on November 19th, is of vital importance for Budapest, and it is above all to get Berlin’s approval on this matter.

Orban hoped he could find support for his own anti-sanction position in the German business world, as German industry suffered greatly due to anti-Russian sanctions. Germany is still the largest foreign investor in Hungary and the country’s main trading partner. But Orban doesn’t seem to have found what he hoped for: German industrialists didn’t like Orban, who attended a business forum in Berlin. The German industry as a whole supports anti-Russian sanctions, said Philip Hausmann, president of the German Eastern Trade Association. Hausmann also warned that the German-Hungarian partnership was in danger. According to him, the increasing “illiberal” practices of the Hungarian government were disrupting this partnership. “Whoever cooperates with us wins,” Orban said.

The latest situation in Germany, France, Italy

In the past week, it may not have been felt around here how the tension between Germany and France got to the newspapers. But the hysteria in the French press reached such a point that the country’s oldest financial newspaper, Les Echos, made the headline, “The war between France and Germany has become possible again.”

What happened? The German-French joint cabinet meeting was cancelled, with Scholz and Macron avoiding the cameras. Current contradictions are evident: rising energy prices and Germany’s unilateral subsidy decision, objection to increasing joint debt. All this is causing Paris to raise eyebrows. Moreover, Olaf Scholz’s visit to China was not welcomed by Emmanuel Macron, who reportedly offered to “give the impression that Europe is united” and the German Chancellor declined. France argues that the two countries must develop a special relationship in order to make the EU a geopolitical centre and to create a weight against the US and China. On top of that, France seems to be far behind its oldest rival economically in the last few decades.

It seems that Germany is not very much involved. Germany, which has bowed to the United States militarily and economically, also seems to have paused on joint defence projects with France. From the French point of view, the Germans think: If a European-based defense industry is to be developed, it must be a German industry under American control. Otherwise, there should be no such defense industry at all. It is clear that the two countries have different interpretations of “strategic autonomy”of the EU.

In Italy, another powerful country, the new right-wing power that has aroused “fear” in Brussels, is not thought to be that frightening. Giorgia Meloni, who met Brussels bureaucrats for the first time after his election, described the dialogue as “very sincere and very positive”. Meloni reiterated his pro-EU position on joint fight against rising energy prices and support for Ukraine against Russia. Meloni presents himself to the EU as a pragmatic, moderate and mainstream politician.

[1]. According to an Italian newspaper, the United Kingdom has for some time been eager to establish a “Commonwealth of Europe” consisting of the Baltic countries, Poland and Ukraine. Even more interestingly, according to the newspaper, Turkey will be added to it soon after the community is formed. See the news.

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EU leaders convened in Brussels to tackle global and regional challenges

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Ahmetcan Uzlaşık, Brussels

The European Council gathered in Brussels on December 19, 2024, bringing together EU leaders to address a packed agenda of critical issues. The meeting focused on pressing topics, including the war in Ukraine, tensions in the Middle East, and the EU’s evolving role on the global stage.

Discussions also centered on enhancing resilience, improving crisis prevention and response mechanisms, managing migration, and other key matters shaping the Union’s priorities. As usual, the European Council set the path for EU’s global engagement and priorities in the current geopolitical context. Policy analyst Fatin Reşat Durukan shared his perspectives on the European Union’s trajectory for 2025 in an interview with Harici.

Anti-Michel Camp is set

The new European Council President, Antonio Costa ran his first European Council meeting.

Former European Council President Charles Michel had been heavily criticized for his way of organizing the European Council meetings. The new European Council President, Antonio Costa, the former Portuguese Prime Minister, so far casted a spell on the leaders with his way of work. Charles Michel was also known for his rivalry with Commission President Ursula von der Leyen during his tenure.

European Parliament President Roberta Metsola praised European Council President António Costa for his efforts to start meetings on time and streamline summit discussions, allowing leaders to focus on political priorities rather than lengthy text negotiations, a shift she called “quite rare.”

Former European Council President Charles Michel declined an invitation to join a group photo commemorating the Council’s 50th anniversary, according to POLITICO.

The Presidency of the European Council means a lot inside the Brussels Beat, as it sets the strategic direction and has a pivotal role in decision-making in macro matters. The summit was also concerned in that sense as experts indicated that the current political landscape in Europe needs leadership as Germany and France are in political and economic turmoil.

Ukraine Remains Central to EU Discussions

Ukraine remained a central focus of the discussions, as it has been in recent years. The European Council released a separate press release for the conclusions on Ukraine.

Ukrainian President, Volodomyr Zelenskyy had attended the first part of the European Council meeting, on an invitation from the new European Council President.

Speaking alongside European Council President Antonio Costa, Ukrainian President Volodymyr Zelensky stressed the importance of unity between Europe and the United States to achieve peace in Ukraine, noting that European support would be challenging without U.S. assistance and expressing readiness to engage with President-elect Donald Trump once he takes office. Costa, too, re-affirmed Europe’s commitment to supporting Ukraine, pledging to do “whatever it takes, for as long as necessary,” both during the war and in the peace that follows.

The Ukrainian President also stated that Ukraine needs 19 additional air defense systems to safeguard its energy infrastructure, including nuclear power plants, from Russian missile strikes.

Kaja Kallas, EU’s foreign policy face, emphasized that Russia is not invincible and urged Europe to recognize its own strength, warning that premature negotiations could result in a bad deal for Ukraine. She stressed the need for a strong stance, noting that the world is watching Europe’s response.

The EU leaders then continued their discussion on Ukraine without Zelensky.

“China would be only winner from a EU-US trade war” says Kallas

Upon her arrival, EU’s top diplomat Kaja Kallas warned that China would be the only beneficiary of a trade war between Europe and the United States, emphasizing that such conflicts have no true winners. Responding to U.S. President-elect Donald Trump’s tariff threats, she noted that American citizens would also bear the consequences, urging caution in trade relations.

“In 2025, we need to step up”

At the European Council meeting, European Parliament President Roberta Metsola urged EU leaders to “step up” in 2025 to solidify Europe’s position on the global stage.

Turning to the EU’s broader neighborhood, she warned of Russian interference in Moldova, Georgia, and the Western Balkans, advocating for accelerated enlargement efforts. Metsola celebrated the historic integration of Romania and Bulgaria into the Schengen Area and underscored the importance of European leadership in addressing crises in Belarus, the Middle East, and Syria. “Now is our moment to step up,” she declared, urging unity and decisive action for Europe.

Leadership void in the EU

Durukan highlighted the significant leadership challenges facing the EU in 2025, particularly stemming from political crises in Germany and France. “Political crises in France and Germany have created a leadership void, making it harder to tackle economic problems. In France, the government collapsed after a no-confidence vote, while in Germany, the coalition broke down, leading to early elections in February 2025. The economic outlook is not great either, with the OECD cutting growth forecasts for Germany and France.The return of Donald Trump as U.S. president adds more complications, with potential trade tensions and shifting global dynamics”, he explained. These disruptions have created a leadership void, complicating the EU’s ability to address broader economic and geopolitical issues.

He also pointed to financial instability, noting that the OECD has cut growth forecasts for Germany and France. “Draghi’s report suggests that the EU needs to invest €750-800 billion annually to stay competitive,” The challenges of implementing such a plan amidst political disagreements might be compelling for the Union.

Despite these obstacles, he acknowledged ongoing efforts to strengthen the EU’s strategic independence, including initiatives like the EU-Mercosur trade agreement and technological leadership. However, he cautioned that political divisions and the rise of far-right parties are eroding confidence in the EU’s unity and global standing. “The coming months will be crucial,” he noted, as the bloc navigates both internal and external pressures.

Ukraine aid sparks future division concerns

On the European Council’s reaffirmation of support for Ukraine, Durukan highlighted the €50 billion aid package for 2024–2027 and plans to allocate €18.1 billion in 2025 as evidence of the EU’s commitment. “The emphasis on ensuring Ukraine’s participation in decisions about its future is a clear message of solidarity,” Durukan said.

However, he pointed to obstacles posed by diverging interests among member states, particularly Hungary’s resistance, as potential stumbling blocks. “The prolonged conflict, economic pressures, and domestic political shifts could further deepen these divisions in the coming months,” Durukan told.

Climate action amidst constraints

The conclusions also stressed on the importance of increasing the number of natural disasters due to climate change and environmental degradation. France and Spain have faced significant challenges in recent months due to natural disasters. The EU has to balance the budgetary constraints and rising defence spendings with its climate goals in 2025.

“The EU is taking decisive steps to achieve its climate goals through legal frameworks such as the European Climate Law and the “Fit for 55” package. In addition, aiming to reduce greenhouse gas emissions by 55% by 2030, the EU will implement CBAM starting in 2026, which will introduce a carbon price on imports. This system, therefore, will prevent carbon leakage and promote global climate action,” Durukan explained.

In light of the increasing defence spendings, Durukan, “the EU integrates energy efficiency and renewable energy use in military facilities, thus aligning security with sustainability. Furthermore, the European Scientific Advisory Board on Climate Change will monitor progress and provide independent scientific advice, enhancing transparency”, said Harici.

Looking ahead, he emphasized the importance of the new Commission setting 2040 climate targets and sector-specific roadmaps. “Achieving these goals will require a focus on sustainable competitiveness and just transition reforms to ensure inclusivity and economic viability,” Durukan concluded.

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Germany closes 2024 with armament records

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Germany concludes 2024 with unprecedented milestones in the armament and defense industry, solidifying its position as a key global player in military exports and domestic modernization. On Wednesday, the Bundestag Budget Committee approved 38 new armament projects, raising the total to 97—significantly surpassing the 55 projects approved last year.

Additionally, German arms exports reached a historic high, exceeding the 2023 record before the year’s end, now standing at €13.2 billion. For context, this figure was just €4 billion a decade ago.

Ukraine emerged as the largest recipient, accounting for 62% of Germany’s military equipment exports. Other major recipients include Turkey, Israel, India, and strategic Asian partners aiming to reduce reliance on Russian arms. These markets reflect Berlin’s strategy to support allies in the power dynamics against China and Russia.

Domestically, Germany has accelerated modernization across all branches of its armed forces. Highlights include substantial investments in the Bundeswehr’s digitalization, air defense systems, and naval capabilities. Among the notable projects: The procurement of 212CD class submarines jointly developed with Norway, with costs estimated at €4.7 billion. These submarines, optimized for deployment in the North Atlantic, are designed to counter Russia’s Northern Fleet. Construction of F127 air defense frigates at an estimated cost of €15 billion, equipped with Lockheed Martin Canada’s CMS 330 system, promoting “Europeanized” production free from U.S. export restrictions.

While Germany leads in advanced submarine classes, its frigate production reflects a blend of domestic and international systems, underscoring the collaborative nature of European defense manufacturing.

The approved projects span multiple military branches, including rocket artillery, thermal imaging equipment, and IT systems for the “Digitalization of Land Operations” project, Patriot missiles, Iris-T air defense systems, and space surveillance radar for the Air Force, and new data centers and armored vehicles for cyber forces. The 38 new projects alone account for €21 billion, with additional costs anticipated for future phases.

The German arms industry achieved record-breaking exports in 2024, with licenses totaling €13.2 billion by December 17. This marks a 200% increase compared to 2014. Arms deliveries to Ukraine played a pivotal role, with licenses worth €8.1 billion granted in 2024 alone.

Germany’s export strategy reflects its geopolitical alignment. Turkey, despite previously strained relations, ranked fifth in exports with €230.8 million. In Asia, Singapore and South Korea emerged as significant buyers, with licenses valued at €1.218 billion and €256.4 million, respectively. Germany has also deepened ties with India, authorizing licenses worth €437.6 million over the past two years to reduce New Delhi’s reliance on Russian defense supplies.

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AfD election manifesto advocates for ‘Dexit’

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The Alternative for Germany (Alternative für Deutschland, AfD) has reaffirmed its commitment to withdrawing Germany from the European Union (EU) and the eurozone should it come to power. This proposal, often referred to as ‘Dexit,’ forms a key component of the party’s draft election manifesto, which was distributed to its members ahead of a party conference in early January. The manifesto reiterates a stance initially introduced during the European election campaign in the summer.

The AfD envisions replacing the EU with a “Europe of the homelands,” described as a coalition of sovereign states engaged in a common market and an “economic and interest community.” The party also advocates for Germany to abandon the euro, the shared currency implemented in 2002, proposing instead a so-called “transfer union.”

While the manifesto acknowledges that a sudden departure would be detrimental, it suggests renegotiating Germany’s relationships with both EU member states and other European nations. To further this agenda, the AfD calls for a nationwide referendum on the issue.

Despite the AfD’s ambitions, legal experts point out that leaving the EU would be constitutionally challenging for Germany. Germany’s EU membership is enshrined in its constitution, and any exit would require a two-thirds majority in parliament—a hurdle that makes a unilateral withdrawal virtually impossible.

Even AfD leaders appear divided on the immediacy of a ‘Dexit.’ Co-chairman Tino Chrupalla admitted in February 2024 that it may already be “too late” for Germany to leave the EU, while Alice Weidel, the party’s other co-leader and candidate for chancellor, described Dexit as merely a “Plan B” in a recent Financial Times interview.

The AfD’s proposal has drawn sharp criticism from leading German economic institutions and industry groups. A May study by the German Economic Institute (Institut der deutschen Wirtschaft, IW) warned that leaving the EU could cost Germany €690 billion over five years, reduce GDP by 5.6%, and lead to 2.5 million fewer jobs—economic impacts comparable to the combined effects of the COVID-19 pandemic and the energy crisis.

The German Association of Small and Medium-Sized Enterprises (Bundesverband mittelständische Wirtschaft, BVMW) was even more scathing, describing the AfD’s plans as an “economic kamikaze mission.”

AfD spokesperson Ronald Gläser dismissed these concerns, arguing that Germany could secure similar benefits through alternative agreements outside the EU framework. Citing Brexit, he suggested that fears of economic disaster were exaggerated: “All the fear scenarios about Brexit went more or less smoothly.”

Gläser contended that Germany’s economic prowess would sustain demand for its products across Europe even outside the EU, pointing to Switzerland’s non-EU membership as a comparable example.

Public sentiment, however, does not align with the AfD’s position. A recent poll by the Konrad Adenauer Foundation (KAS), affiliated with the conservative Christian Democratic Union (CDU), found that 87% of Germans would vote to remain in the EU if a referendum were held. Despite this, Gläser argued that policy decisions should prioritize what is “necessary and important” over public opinion.

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