In Germany, the large energy price defense umbrella, unofficially simply the "double boom", is intended to save people horrendous gas bills. In the case of the EU partners, on the other hand, it seems to be the terror itself. At the summit in Prague, Chancellor Scholz has to listen to a lot.
Chancellor Olaf Scholz met with massive criticism at the EU summit in Prague with his "double boom" to cushion the high energy prices. Poland's Prime Minister Mateusz Morawiecki spoke of "German egoism" and appealed to Germany's solidarity with the other EU countries. Other heads of government and EU Commission President Ursula von der Leyen warned that the German 200 billion package would distort the common market.
Scholz, on the other hand, emphasized in the Czech capital: "With our decisions (...) we are moving within the framework of what others are doing in Europe." The summit was primarily intended to show ways out of the energy crisis caused by Russia. The exploding energy costs are causing problems for consumers and the economy alike - and winter is yet to come. However, a European solution, especially in the fight against high gas prices, is still a long time coming. Also because Germany is reluctant to an EU-wide gas price cap demanded by many countries.
No common approach was found at the Prague summit - instead, von der Leyen announced more detailed proposals in a timely manner. Decisions could then be made at the next EU summit in just under two weeks. "We are moving in the direction of joint solutions," said Czech Prime Minister Petr Fiala. In the meantime, the federal government has already created facts. She wants to set up a national program and make up to 200 billion euros available for it by 2024 - a sum that would swindle other, less economically strong countries. This is intended to cushion the high electricity and gas prices.
What Scholz calls "double boom" is a cause for concern for countries like Poland, Luxembourg and Latvia. Morawiecki expressed himself most clearly: "German egoism" must finally be put in the drawer, he said. One is decided against the destruction of the European single market. "The richest and economically strongest country in the European Union is trying to use this crisis to give its companies a competitive advantage over other companies in the internal market. That's not fair." Many countries pointed out at the summit that this was the wrong way to go. The day before, Morawiecki had warned against a "dictation by Germany" in European energy policy.
The key word in Brussels jargon is "level playing field" - competitive equality. Commission President von der Leyen pointed this out in Prague and warned that the common market could suffer from national unilateralism. It is important that all companies have the same opportunities to participate in the internal market. There shouldn't be any competition through subsidies, only through quality.
Above all, the accusation of going it alone nationally should hurt Scholz. For months he has repeatedly emphasized that there should be no going it alone in the Ukraine crisis - when it comes to arms deliveries. Now EU partners are complaining about Germany going it alone in combating the energy shortage. Memories of other crises are awakened in which Germany was accused of selfishness and recklessness, such as the euro crisis or the initial phase of the corona pandemic. Morawiecki addressed Germany with a message: "Be united, in solidarity with everyone else."
Scholz, however, lets the allegations bounce off. With his comparison to other countries, he refers to countries like France, the Netherlands or Spain. He used the opportunity at the summit to explain "the German defensive struggle" to his colleagues and to put the European context into perspective. "That was important and certainly helped clear up any misunderstandings."
However, calculations by the Brussels think tank Bruegel show that these countries do not come close to the dimensions of the German efforts. The Netherlands, for example, announced relief worth around 50 billion euros - including all projects since September last year. According to Bruegel, that is about 5 percent of the Dutch gross domestic product.
The 200 billion of the "double boom" would correspond to about 5 percent of German GDP. But if you include the relief planned since September 2021, you get a total of around 300 billion euros - around 8 percent of German GDP. Another example: Spain has spent around 35 billion euros on relief programs since September last year, which is 2.9 percent of economic output. "With the German package, we are really entering a completely different dimension," said Bruegel economist Simone Tagliapietra.
