Deutsche Bahn irked over lack of rail competition in France

German railway Deutsche Bahn has told French counterpart SNCF that it is fed up with a lack of competition in France, according to a letter obtained by news agency AFP.

Deutsche Bahn irked over lack of rail competition in France
A German ICE train at Gare de l'Est in Paris. Photo: DPA

“We no longer want to accept the lack of reciprocity between Germany and France,” Bahn boss Hartmut Mehdorn said in a letter sent to French counterpart Guillaume Pepy.

“The opening of the German market has advanced further than in France,” and “the SNCF, like other French companies, profits greatly while we and other foreign companies always come up against the same problems in France,” Mehdorn said.

Those problems included “a closed market for passenger transport, a market that is theoretically open but inaccessible for urban transport, and major obstacles” in the freight sector, he added.

Mehdorn also said he was “surprised and affected” by strong attacks last week by Pepy against Deutsche Bahn.

Pepy claimed that a Bahn subsidiary had hacked into the SNCF computer system to try to hire train drivers away from the French group. The accusation “was groundless” Mehdorn said.

He added that the German railway had “not yet begun any official approach” towards investing in the high-speed Eurostar train that connects London with Brussels and Paris.

British press reports have said Deutsche Bahn would like to buy the part in Eurostar now owned by British interests, which Pepy had said was “premature, pretentious and arrogant.”

Tension has risen between the French and German rivals in particular since Deutsche Bahn and the Italian railway complained about a lack of European competition in a letter to the European Commission.

The German company has also sought recourse in court against the attribution in October of the public transport market in the southwestern French city of Bordeaux to the French group Keolis. It had previously been operated by the French company Veolia.


The Euro celebrates its 20th anniversary

The euro on Saturday marked 20 years since people began to use the single European currency, overcoming initial doubts, price concerns and a debt crisis to spread across the region.

The Euro celebrates its 20th anniversary
The Euro is projected onto the walls of the European Central Bank in Brussels. Photo: Daniel Rolund/AFP

European Commission chief Ursula von der Leyen called the euro “a true symbol for the strength of Europe” while European Central Bank President Christine Lagarde described it as “a beacon of stability and solidity around the world”.

Euro banknotes and coins came into circulation in 12 countries on January 1, 2002, greeted by a mix of enthusiasm and scepticism from citizens who had to trade in their Deutsche marks, French francs, pesetas and liras.

The euro is now used by 340 million people in 19 nations, from Ireland to Germany to Slovakia. Bulgaria, Croatia and Romania are next in line to join the eurozone — though people are divided over the benefits of abandoning their national currencies.

European Council President Charles Michel argued it was necessary to leverage the euro to back up the EU’s goals of fighting climate change and leading on digital innovation. He added that it was “vital” work on a banking union and a capital markets
union be completed.

The idea of creating the euro first emerged in the 1970s as a way to deepen European integration, make trade simpler between member nations and give the continent a currency to compete with the mighty US dollar.

Officials credit the euro with helping Europe avoid economic catastrophe during the coronavirus pandemic.

“Clearly, Europe and the euro have become inseparable,” Lagarde wrote in a blog post. “For young Europeans… it must be almost impossible to imagine Europe without it.”

In the euro’s initial days, consumers were concerned it caused prices to rise as countries converted to the new currency. Though some products — such as coffee at cafes — slightly increased as businesses rounded up their conversions, official statistics have shown that the euro has brought more stable inflation.

Dearer goods have not increased in price, and even dropped in some cases. Nevertheless, the belief that the euro has made everything more expensive persists.

New look

The red, blue and orange banknotes were designed to look the same everywhere, with illustrations of generic Gothic, Romanesque and Renaissance architecture to ensure no country was represented over the others.

In December, the ECB said the bills were ready for a makeover, announcing a design and consultation process with help from the public. A decision is expected in 2024.

“After 20 years, it’s time to review the look of our banknotes to make them more relatable to Europeans of all ages and backgrounds,” Lagarde said.

Euro banknotes are “here to stay”, she said, although the ECB is also considering creating a digital euro in step with other central banks around the globe.

While the dollar still reigns supreme across the globe, the euro is now the world’s second most-used currency, accounting for 20 percent of global foreign exchange reserves compared to 60 percent for the US greenback.

Von der Leyen, in a video statement, said: “We are the biggest player in the world trade and nearly half of this trade takes place in euros.”

‘Valuable lessons’

The eurozone faced an existential threat a decade ago when it was rocked by a debt crisis that began in Greece and spread to other countries. Greece, Ireland, Portugal, Spain and Cyprus were saved through bailouts in return for austerity measures, and the euro stepped back from the brink.

Members of the Eurogroup of finance ministers said in a joint article they learned “valuable lessons” from that experience that enabled their euro-using nations to swiftly respond to fall-out from the coronavirus pandemic.

As the Covid crisis savaged economies, EU countries rolled out huge stimulus programmes while the ECB deployed a huge bond-buying scheme to keep borrowing costs low.

Yanis Varoufakis, now leader of the DiEM 25 party who resigned as Greek finance minister during the debt crisis, remains a sharp critic of the euro. Varoufakis told the Democracy in Europe Movement 25 website that the euro may seem to make sense in calm periods because borrowing costs are lower and there are no exchange rates.

But retaining a nation’s currency is like “automobile assurance,” he said, as people do not know its value until there is a road accident. In fact, he charged, the euro increases the risk of having an accident.