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AFGHANISTAN

Germany must do more for NATO

On the eve of the NATO’s 60th anniversary summit this week, Dr. Henning Riecke from the German Council on Foreign Relations argues Berlin must make a greater commitment to the transatlantic alliance.

Germany must do more for NATO
The spring offensive begins in Afghanistan. Photo: DPA

With no enemy countries in its immediate proximity, a risk of terrorist attacks at home thus far under control and the controversial deployment of German troops in Afghanistan, there are doubts about whether the transatlantic alliance is still important for Germany. Is the concept of NATO passé?

Absolutely not. We are still vulnerable. There are many new security risks that present dangers for Germany and international order. These include the proliferation of nuclear weapons, such as nuclear armament in Iran and its neighbouring countries. Unstable states such as Afghanistan in the past, Somalia at the moment and perhaps Pakistan in the near future present a risk because radical groups can use them as a space to regain strength. Energy security is not only endangered by power-obsessed countries which are providers: when terrorists carry out attacks on gas pipelines or pirates take control of our trading vessels, it affects us directly.

For these reasons NATO needs a new strategic outlook. The most important aim of the 60th anniversary summit should be to gain political consensus among the member states for setting future objectives. How should we react to the new security risks? Where does NATO bring additional value and where should it be active? These questions should be asked and discussed in a reasoned fashion. In the future, NATO must play a greater role as a forum for dialogue between the Europeans and their partners across the Atlantic.

The change of government in the United States offers good opportunities to find such consensus, because President Barack Obama is seeking agreement with the allies and wants to pursue a unified approach to solving crises. This is more acceptable for Europeans; however it also means they have to show more willingness to act. It is important for Germany’s role in Afghanistan that a flexible approach is taken to decisions about dispatching troops. In addition, more money and personnel need to be invested in training Afghan security forces.

France’s return to the alliance strengthens not only NATO but also Germany’s position. Germany and France agree on many issues. For example, they are sceptical about eastern and functional expansion: together they can lobby more strongly in those areas.

Russia however is providing cause for concern. President Dmitry Medvedev’s announcement that Moscow is planning to modernise its army, navy and nuclear weapons arsenal is aggressive and threatens the Eastern European alliance partners. This stance is however also directed inwards, as a reaction against the loss of influence since the mid-1990s and the eastern expansion of NATO. The fact that the member states agreed on the admission of Georgia and Ukraine at the Bucharest summit might place a heavy burden on relations with Russia. The NATO members should ensure that the conditions do not make Russia feel threatened. This could be achieved through agreements on armaments control, or by accepting negotiations on parts of a new European security plan, which Medvedev suggested.

Germany can make a contribution to finding the right balance between partnership and containment with Russia. Germany has a good relationship with Moscow and is taken seriously – we can use that. In the future, the German government should also take a more active role as mediator, for example between those members who want to retain a European focus and those aiming for a global orientation. In Germany there are too many reservations towards military measures – here we need to take a much more pragmatic approach.

Dr. Henning Riecke is a security policy expert at the German Council on Foreign Relations in Berlin. Translation by The Local.

EUROPEAN UNION

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.

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