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Merz begins coalition talks with SPD after German election victory

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CDU leader Friedrich Merz, who won the German federal elections, announced on Monday that coalition talks with the Social Democrats (SPD) had begun immediately.

Merz’s Christian Democrats won the elections by a large margin but now have to find a coalition partner.

As expected, the party’s leading candidate quickly turned to the SPD, the party of incumbent Chancellor Olaf Scholz, as his preferred partner.

“We will hold talks [with the SPD] in the next few days,” Merz told reporters at the CDU headquarters in Berlin on Monday, listing foreign and security policy, managing migration, and strengthening German industry as priorities.

On the same day, Merz will also meet with SPD co-leader Lars Klingbeil, he said, adding that he would also speak with Scholz to coordinate the transition.

Klingbeil, who some see as the new leader of the party after Scholz announced his imminent departure, played it down on Monday, saying it was not certain that the SPD would join a coalition but added that it was “ready to hold talks.”

The share of seats for the center-left and center-right parties fell by a third compared to the last election in 2021. The coalition of the Greens and the CDU failed to secure a majority, while the liberal Free Democrats (FDP) failed to re-enter parliament.

The CDU could have had a majority with the right-wing Alternative for Germany (AfD), but Merz once again rejected formal co-operation on Sunday.

According to the Munich-based Ifo Institute, reaching NATO’s spending target of just 2% would require 95 billion euros annually from 2028 onwards, almost double the current defense budget. A possible 3% target would require 140 billion euros.

To change the constitution, however, a two-thirds majority in the German parliament is required, which the center parties CDU/CSU, SPD, and Greens lack, making Die Linke (Left Party) and AfD the key parties.

The Greens have proposed to call an emergency session of the Bundestag within the next 30 days, while parliament is still officially in session under its previous composition, in order to allow new borrowing and defense investments. Both Merz and Scholz have signaled that they are open to this approach.

One option would be to agree to reform the “debt brake,” a constitutional limit on the budget deficit, in order to increase the fiscal leeway, including for defense.

Introduced in 2009, the debt brake limits structural public deficits to 0.35% of GDP but has recently come under criticism for hindering investment in infrastructure and defense.

Alternatively, the government could set up a special extra-budgetary fund outside the limits of the debt brake, which could be approved by a two-thirds majority. Such a special fund of 100 billion euros was created after the war in Ukraine, but it will be exhausted by 2027.

The CDU officially wants to keep the debt limit, but Merz signaled during the campaign that he is open to reform.

The SPD is in favor of reform and has previously argued that higher defense spending should not come at the expense of pensioners, the welfare state, or other public investments.

Markus Soeder, leader of the CDU’s Bavarian sister party, the Christian Social Union (CSU), echoed these views on Monday, arguing that it would not be possible to organize defense by “cutting everything” and causing “social tensions.”

Merz may also opt for tough negotiations with the Left Party in the new parliament. The Left Party leaves the door open to jointly reforming the debt brake but opposes higher defense spending.

But given the urgency of the situation and the squeeze on the center, the old rules seem to be changing rapidly.

Merz said his priority was to end the crisis situation in Germany and restore confidence after a difficult three-year period.

“Some of you will share the view that this period may be one of the last chances to achieve this,” he told reporters.

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Digital ministers from D9+ group urge EU to establish common age limit for social media

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Digital ministers from the D9+ group, which represents some of the European Union’s most digitally advanced member states, are pushing for a unified approach to address growing concerns over children’s safety on social media.

In a joint declaration, 14 EU tech ministers led by Luxembourg called on the European Commission to adopt “a truly European approach to protecting children online” by coordinating the enforcement of EU rules governing child safety.

They also urged the bloc to develop “a common approach to the digital age of majority across the EU,” referring to a potential union-wide age limit for accessing social media platforms.

Last month, European Commission President Ursula von der Leyen indicated that the bloc could consider introducing legislation to this effect as early as this summer.

However, the declaration also highlights a dissenting voice. Estonia, which has emerged as a prominent critic of EU social media restrictions, raised objections to horizontal age restrictions at the EU level and stated that it does not support provisions aimed at enforcing age limits on digital platforms.

Estonia also opposed what it described as “disproportionate” age verification measures that would require all users to verify their age and identity.

In contrast, the remaining members of the D9+ group supported “privacy-preserving EU-wide age verification” in the declaration.

This position appears to reference the EU’s own age-verification technology intended for national implementation, which the Commission asserts is secure from a privacy perspective.

The member states also demanded that online platforms adapt their interfaces based on the age and vulnerability of their users.

This refers to ensuring platforms are safe by design and age-appropriate by default.

Furthermore, the ministers requested that the Digital Fairness Act (DFA)—a set of rules aimed at strengthening online consumer protection by tackling dark patterns and addictive designs, which the Commission plans to propose by the end of the year—be a “targeted” instrument within the context of the bloc’s broader regulatory simplification efforts.

The declaration also addresses other digital policy areas, with a particular emphasis on the EU’s technology sovereignty following the Commission’s adoption of a major microchip and cloud proposal last week.

The 14 digital ministers demanded that technology sovereignty be pursued “openly,” calling for measures to ensure that digital sovereignty does not become “solely an EU-specific vision.”

This phrasing implies that the D9+ countries would reject EU digital infrastructure support measures that could be accused of being protectionist by excluding foreign providers.

The Commission’s draft Cloud and AI Development Act allows foreign cloud providers the flexibility to obtain certification as EU partners at nearly the highest sovereignty levels.

The D9+ group includes the following countries: Austria, Belgium, Denmark, Estonia, Finland, Ireland, Luxembourg, the Netherlands, Poland, and Sweden.

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Germany and France scrap joint fighter jet project amid industrial deadlock

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Germany and France have abandoned their plans to jointly develop a next-generation fighter jet, following deep-seated industrial disputes that have derailed one of Europe’s most ambitious defense initiatives.

The collapse of the program represents a significant setback for French President Emmanuel Macron’s long-standing vision of strengthening European defense integration and strategic autonomy.

A German government official, speaking to POLITICO on condition of anonymity due to the sensitivity of the matter, stated: “President [Emmanuel] Macron and Federal Chancellor [Friedrich Merz] have reached a joint conclusion that the companies involved are unable to come together to produce a joint fighter aircraft. They accept this reality.” The official added: “For this reason, Chancellor Merz has advised President Macron not to pursue further work on the development of a joint combat aircraft.”

The project, known as the Future Combat Air System (FCAS), was launched in 2017 but had repeatedly stalled due to fierce disagreements between France’s Dassault Aviation and Germany’s Airbus Defence and Space over which entity would take the lead. Spain is also a partner in the FCAS program, which was intended to replace the German Eurofighter and the French Rafale fleets by approximately 2040.

Beyond the core fighter jet, the program encompasses a “system of systems,” including drones and a “combat cloud”—a digital backbone designed to integrate sensors, satellites, unmanned platforms, and manned aircraft into a single operational network.

Late Monday, the Elysee Palace issued a statement confirming that Airbus Defence and Space and Dassault Aviation had failed to reach an agreement. The French presidency implied that the decision to terminate the project was a unilateral German move, telling reporters: “German authorities concluded that it was no longer possible to exert further pressure on the companies in question. France maintains the view that Franco-German cooperation in defense and security remains vital for both our countries and our European partners.”

Despite the failure of the fighter jet component, the German official did not rule out continued cooperation between Paris and Berlin on drones and the combat cloud system. “The core of FCAS will continue as a European ‘system of systems.’ This is, in a sense, the nervous system that connects aircraft, drones, and other components into an integrated whole,” the official said.

The official further noted that the French and German defense ministries would be tasked with developing a work plan for industrial defense cooperation “focused on several realistic and relevant projects.”

The FCAS is not the only multilateral defense program facing significant hurdles. Joint Franco-German plans to develop maritime patrol aircraft, a next-generation tank (Main Ground Combat System), and new artillery systems have all faltered in recent years. Simultaneously, the Global Combat Air Programme (GCAP)—a rival fighter jet project led by the United Kingdom, Italy, and Japan—has also experienced internal friction.

France has effectively withdrawn from the multi-billion-euro, four-nation Eurodrone program. The future of that initiative remains uncertain as the remaining partners—Germany, Italy, and Spain—evaluate how to proceed.

The termination of the FCAS fighter jet component was not a sudden rupture but the culmination of a protracted and attritional struggle between Europe’s two most influential defense firms, Airbus and Dassault Aviation. As previously reported by POLITICO, German and French officials had been privately acknowledging for months that the fighter jet element of the project was effectively “dead.”

The deadlock intensified last summer when Dassault, the manufacturer of the Rafale, pushed to secure the undisputed lead in the construction of the FCAS fighter. Under that proposal, Airbus would have been relegated to the role of a subcontractor with limited oversight of the design, while Dassault would have retained the power to select suppliers, determine workshare, and act as the sole point of contact for customers.

Airbus rejected this approach as a fundamental violation of the original partnership agreement. The company argued it would transform a European cooperative program into a French-led project subsidized by German and Spanish funding and industrial expertise. By September, reports emerged that Berlin had begun exploring alternative options, including potential cooperation with Sweden or joining the rival GCAP program.

Beyond industrial control, Paris and Berlin remained divided over the technical specifications of the aircraft. France required a lighter jet capable of carrier-based operations, while Germany sought a heavier airframe optimized for air superiority missions. Berlin eventually proposed building two separate versions of the aircraft, a solution Paris rejected.

In March, Merz and Macron agreed to give the project a final opportunity to succeed, but subsequent negotiations failed to bridge the deep divisions. On Monday, the German Chancellery officially notified Airbus of the decision to cancel the project. According to La Tribune, Merz is expected to formally announce the decision on Wednesday during the opening of the ILA Berlin Air Show.

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UK underwater deterrent facing scrutiny as all active Astute-class submarines remain in port

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All five of the Royal Navy’s active Astute-class nuclear-powered attack submarines are reportedly held in port for repairs or maintenance, leaving the UK with no operational vessels of this class ready for deployment.

According to a report by The Telegraph, which cited naval sources, although a sixth submarine of the same class has officially joined the fleet, it is not yet ready for deployment.

The current situation means that the UK temporarily lacks any nuclear-powered attack submarines cleared for active operations. Ryan Ramsey, a former nuclear submarine commander, described the development as a serious warning signal. “We look vulnerable,” Ramsey said. “The Russians know we can’t get our submarines to sea. When you cannot provide a deterrent at sea, you lose credibility in the eyes of the Russians.”

Lord Alan West, the former First Sea Lord and former security minister, also described the state of the submarine fleet as unacceptable and deeply concerning.

The UK Ministry of Defence stated in response to the reports that it does not normally comment on the operational status of the submarine fleet. Emphasizing that British waters remain protected at all times through a range of measures, the ministry added that strengthening underwater capability continues to be a top priority.

Astute-class nuclear submarines are tasked with protecting the UK’s Vanguard-class strategic ballistic missile submarines, which carry the country’s nuclear deterrent, as well as the aircraft carriers HMS Queen Elizabeth and HMS Prince of Wales during their deployments.

Separately, the UK’s Vice Chief of the Defence Staff, General Gwyn Jenkins, admitted in an interview with the Swedish newspaper Svenska Dagbladet in April that the Royal Navy was not sufficiently prepared for a potential war.

While noting that the navy possesses the resources to conduct combat operations and that personnel stand ready to carry out orders, Jenkins added: “But are we as ready as we should be? I think not.” He indicated that efforts to improve readiness levels remain ongoing.

Previously, The Sun newspaper reported that only two of the UK’s six Type 45 destroyers were operational. One of these active vessels, HMS Dragon, was deployed to the Mediterranean to protect British military bases in Cyprus.

The Telegraph also reported that due to a shortage of available ships, the government in London was forced to utilize a German vessel.

The state of the Royal Navy has been described in the British parliament as a “national embarrassment,” while US President Donald Trump has criticized the fleet, referring to it as a “toy navy,” according to reports by The Guardian.

Meanwhile, Russian President Vladimir Putin has repeatedly stated that Russia has no intention of fighting a war with Europe, dismissing such claims as nonsense. Putin has maintained that Western governments are escalating the situation to portray Russia as an adversary.

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