Category Archives: Germany

(EurActiv) German arms exports to Ankara continue despite escalating Greek-Turkish crisis

(EurActiv)

Only last year, deliveries to Turkey made up almost one-third of all German arms exports (€770.8 million) with €242.8 million. [Shutterstock]

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Tensions have escalated between Turkey and two EU member states – Greece and Cyprus. But that hasn’t stopped another EU country, Germany, to continue exporting arms to Ankara, according to official government data.

In response to a request of leftist MP Sevim Dagdelen (Die Linke), the German economy ministryrevealed that in the first four months of this year, Turkey has received armament supplies amounting €184.1 million from Germany.

Only last year, deliveries to Turkey made up almost one-third of all German arms exports (€770.8 million) with €242.8 million.

According to a government report, the weapons for Turkey are reported to be exclusively “maritime goods” meant for six class 214 submarines, which will be built in Turkey with significant involvement of the German arms concern ThyssenKrupp Marine Systems (TKMS).

The German government had approved the delivery of the components already in 2009 and secured the export with a so-called Hermes guarantee amounting to €2.49 billion.

Such guarantees for arms exports to Turkey have not been re-issued since the 2016 failed military coup against President Recep Tayyip Erdogan, which marked its third anniversary on Monday (15 July). Nevertheless, arms exports already approved in the framework of NATO commitments are still carried out on regular terms.

EU foreign ministers decided on Monday (15 July) to postpone for a few hours the announcement of sanctions against Turkey over its drilling in the sea off Cyprus, following a request by Ankara not to interfere with the third anniversary of the coup, EU officials and diplomats told EURACTIV.com.

The measures include cutting €146 million in EU funds from the pre-accession envelope, freezing the European Investment Bank’s activities in the country, halting the cooperation under the EU-Turkey aviation agreement, and cancelling high-level EU-Turkey dialogues.

The EU foreign ministers even warned about “targeted measures”, against individuals and companies, if the Turkish aggression continues.

“The provocations of Turkey are unacceptable for all of us and we are here on the side of Cyprus,” said German Minister of European Affairs Michael Roth (SPD) in Brussels.

Asked whether the German arms exports to Turkey is still appropriate in view of the EU sanction, MEP Joachim Schuster (S&D), who sits on the Subcommittee for Security and Defence (SEDE), said that “at the moment, I believe that exports should be suspended” as this is a special situation and it should be assessed accordingly.

It would be a far-reaching step to be considered, but there is also need to be cautious as “we have the problem that Turkey is a NATO member, and within NATO, arms exports are common”, he said.

Contacted by EURACTIV, New Democracy MEP Manolis Kefalogiannis (EPP) said the EU foreign ministers’ decision to impose economic and political sanctions against Turkey should be respected by all member states and EU institutions.

According to Kefalogiannis, it was a “decision of solidarity” which makes it clear that the borders of Cyprus and Greece are also European, as well as their exclusive economic zones.

“Europe’s position on Turkey’s provocations and aggressiveness is clear and unequivocal. And it was expressed in the most absolute way,” the center-right MEP added.

European arms export policy

Germany recently announced that it considers banning exports of small side-arms to most countries outside the EU and NATO.

Earlier restrictions on exporting weapons systems to countries involved in the Yemen war have strained ties between Berlin and its allies in Paris and London since the presence of German components in many joint projects risked harming lucrative export deals with Saudi Arabia and the United Arab Emirates.

So far, the EU’s common position on arms exports is the only legally binding region-wide arrangement on conventional arms exports.

It technically bars sales to countries that don’t respect human rights and when “there is a clear risk that the intended recipient would use the proposed export aggressively against another country or assert by force a territorial claim”.

In reality, however, the scope to decide remains so far in the responsibility of member states and does not touch agreements with NATO partners.

With the increasing European cooperation on defence projects, the question of arms exports has become a pressing issue in the bloc, last surfacing during the recent inauguration of a new joint Franco-German-Spanish construction of Europe’s largest arms project.

The signed text accompanying the project referred to an agreement that Paris and Berlin are meant to finalise by the end of summer.

“I am firmly convinced that the future of exports needs to be European,” then German defence minister Ursula von der Leyen said when asked about changes in export policy.

“We will have to develop a common European attitude since we will harmonise our armed forces together in the European Defence Union, we will collectively procure systems, and here, using the combat aircraft system as an example, it becomes clear,” she told reporters at the time.

(PUB) Um elogio dos alemães – Miguel Esteves Cardoso

(PUB) Os espanhóis que cá vêm tratam-nos de igual para igual. Os americanos são infantis mas são bem-educados. Só os alemães nos tratam com sobranceria como se tivéssemos sido criados para servi-los.

Chega um alemão da minha idade à esplanada onde estou a almoçar. Aponta para uma mesa e diz “three!”, em inglês contrariado. Não diz “boa tarde” nem “se faz favor”, nem sequer “please”. Não diz “table for three”. Só “three!”. Na véspera tinha reparado como não há espanhol que não diga “muito obrigado” enquanto muitos estrangeiros conseguem chegar a Portugal pensando que “gracias” chega para as encomendas.

Os espanhóis que cá vêm tratam-nos de igual para igual. Os americanos são infantis mas são bem-educados. Só os alemães nos tratam com sobranceria como se tivéssemos sido criados para servi-los.

“Coitados”, pensei, “são selvagens, não sabem comportar-se. Tanto podiam estar na Grécia como na Tunísia”.

Explicaram ao homem — em inglês — que não havia mesas, que era sábado, era Verão, era preciso reservar.

O homem retirou-se com um grunhido. Fiquei chocado. Disse-o a um dos empregados, que calmamente largou a bomba H: aquela besta daquele homem já mora em Portugal há 30 anos.

Há outros alemães — e são sempre alemães — que cá moram há 30 anos e que têm atitudes e comportamentos insuportáveis. Mas, pelo menos, aprenderam a falar umas palavras de português. A superioridade imaginária deles é ridícula mas pode ser contestada — e eles dispõem-se a defender-se, permitindo a discussão e até a cordialidade.

Felizmente, são só os alemães com mais de 60 anos de idade. Sendo mais velhos, só se salvam os aristocratas. É como a própria Alemanha: melhorou imenso em pouco tempo.

De que outro país se pode dizer a mesma optimista coisa?

(OBS) Angela Merkel treme pela terceira vez em público, durante visita do primeiro-ministro finlandês

(OBS)

A chanceler alemã recebeu esta quarta-feira em Berlim o primeiro-ministro finlandês, Antti Rinne. Durante a parada militar, Merkel tremeu pela terceira vez em menos de um mês.Partilhe

Angela Merkel durante a receção ao primeiro-ministro finlandês, Antti Rinne, esta quarta-feira em Berlim

A chanceler alemã, Angela Merkel, voltou a tremer de forma descontrolada em público. Imagens da transmissão televisiva da receção ao primeiro-ministro finlandês, Antti Rinne, em Berlim, mostram Merkel a tremer durante a parada militar.

Trata-se da terceira vez que a chanceler alemã sofre um episódio de tremores em público. A primeira vez aconteceu em junho, durante a visita do presidente ucraniano a Berlim. Poucos dias depois, Merkel voltou a tremer, durante uma conferência de imprensa na capital alemã.

As causas para os tremores de Merkel têm levantado questões sobre o seu estado de saúde. Vários especialistas têm discutido várias possibilidades para a causa dos tremores, que vão do stress e ansiedade à possibilidade de uma doença degenerativa.

(JN) Trump ameaça sanções para travar gasoduto entre Rússia e Alemanha

(JN)

Donald Trump quer travar o projeto Nord Stream 2 e ameaça avançar com sanções, embora não especifique contra quem. Moscovo acusa-o de “chantagem” e concorrência “injusta”.

Donald Trump continua a disparar ameaças a vários dos principais parceiros mundiais dos Estados Unidos. Desta vez, os alvos foram a Alemanha e a Rússia. Em causa está o projeto do gasoduto Nord Stream 2, que irá ligar os dois países europeus e que também tem merecido resistência por parte da Comissão Europeia. O projeto irá aumentar o fluxo de gás da Rússia para a Alemanha, uma meta que Trump pretende travar.

Não é a primeira vez que o presidente norte-americano faz críticas a este projeto, mas fica por esclarecer quem seriam as empresas ou governos alvo de sanções por parte dos Estados Unidos. Na mais recente investida, limitou-se a dizer que está a “proteger” a Alemanha.

“Estamos a proteger a Alemanha da Rússia. A Rússia está a receber milhões e milhões de dólares da Alemanha pelo seu gás”, afirmou o presidente dos Estados Unidos, na Casa Branca, após uma reunião com o presidente polaco, Andrzej Duda. Para Trump, “a Alemanha está a cometer um erro tremendo ao confiar tanto no gasoduto”, já que “é uma tremenda quantidade da sua energia que será fornecida” por esse projeto.

Mesmo sem detalhes, as afirmações de Trump já mereceram resposta por parte de Moscovo. Estas declarações, afirmou o porta-voz do Kremlin, “não são nada se não chantagem e uma forma injusta de concorrência”.

O presidente russo Vladimir Putin foi mais longe e, em declarações ao canal de televisão Mir TV, afirmou que as relações entre os Estados Unidos e a Rússia estão a “deteriorar-se e a ficar cada vez piores”.

O Nord Stream 2 é um empreendimento conjunto entre a energética russa Gazprom e outras cinco empresas europeias. O objetivo é fornecer 55 mil milhões de metros cúbicos de gás natural russo, anualmente, à Alemanha e a outros países europeus, através de um gasoduto duplo colocado no fundo do Mar Báltico.

A própria Comissão Europeia tece críticas a este projeto e tem procurado mesmo chegar a acordo com a Alemanha para estabelecer regras que lhe permitam ter uma palavra a dizer sobre a gestão do gasoduto, uma opção que tem sido rejeitada por Angela Merkel. Já da parte dos Estados Unidos, os receios são de que a Rússia utilize o fornecimento de gás natural como forma de pressão sobre os restantes países europeus dependentes da sua energia.

(AJ) German SPD chief resigns in blow to Merkel’s coalition

(AJ) Andrea Nahles’ resignation follows worst European vote results and precedes three key state elections in Germany.19 hours ago

Andrea Nahles headed the centre-left Social Democratic Party (SPD) [File: Michele Tantussi/Reuters]
Andrea Nahles headed the centre-left Social Democratic Party (SPD) [File: Michele Tantussi/Reuters]

The leader of Chancellor Angela Merkel’s junior coalition partner, the SPD, resigned on Sunday from her party’s top posts, raising the possibility that Germany’s embattled government could collapse.

Andrea Nahles, who heads the centre-left Social Democratic Party (SPD), has come under intense pressure after voters handed the party its worst European election results a week ago.

With an eye on three key state elections in eastern Germany in September, the SPD had initially planned to re-examine its partnership with Merkel’s centre-right CDU-CSU alliance in the autumn.

But ahead of a planned leadership vote on Tuesday, Nahles said she would give up her jobs as both party chief and head of its parliamentary group.

“The discussions in the parliamentary group and the broad feedback from the party showed me that the support necessary for the exercise of my offices is no longer there,” said Nahles in a statement.

The 48-year-old said she hoped her resignation “would open the possibility that the succession can take place in an orderly manner”.

Merkel said on Sunday that Germany’s government would push on with its work despite the setback.

“What I want to say for the government is that we will continue with our work with all seriousness and with great responsibility,” she said in a statement to the press.

Stability lost

Harald Christ, deputy chief of the SPD’s economy forum, told the Bild daily that Nahles’s decision had put the future of the coalition in serious doubt.

“To all those who are happy today: it is a great loss for German politics. Nahles stands for the existence of the GroKo – whose stability is now in question,” he said, using the German short-form for grand coalition.

Anxiously watching as the SPD tumbled into disarray, CDU heavyweights urged their centre-left partner not to endanger the coalition.

“The voter mandate is valid for four years and political parties must ensure stability in difficult times,” the CDU’s Bundestag deputy president Hans-Peter Friedrich told Bild daily.

“An early end of the GroKo would only benefit the political fringes.”

Merkel’s CDU itself was scrambling to retain voters, after it too scored a record low in the European elections.

Her favoured successor Annegret Kramp-Karrenbauer was also struggling to put down a raging online youth revolt against the party, raising questions as to whether she is the best person for Germany’s top job when Merkel leaves the political stage in 2021.

‘Already disintegrating’

Following Nahles’ bombshell, the CDU said both Kramp-Karrenbauer and Merkel would address the press later on Sunday.

But the far-right AfD said the government was already disintegrating.

“Not only is the SPD dissolving, the GroKo too is walking the political stage only as one of the undead,” wrote the co-leader of the AfD’s group in parliament, Alice Weidel, on Twitter.

Some newspapers reached similar conclusions.

Bild daily noted that “the SPD is bleeding to death. The GroKo too”. And the Sueddeutsche daily predicted that “the coalition has come to an end.

“The Social Democrats have just defeated the woman who with great effort brought the alliance together. What’s the point now then of continuing to torment themselves with this?”

(ZH) Merkel Unretires: Chancellor Determined To Remain In Power Until 2021 As Succession Plan Implodes

(ZH)

The CDU’s abysmal showing in last week’s EU Parliamentary election marked the party’s worst result ever in a national election. And apparently, the the loss of the CDU/CSU’s position as the largest party in the bloc’s largest legislative body was the last straw for Chancellor Angela Merkel, who reportedly regrets her decision to step aside as party leader last year – a decision she made to clear the way for her chosen successor, Annegret Kramp-Karrenbauer, or AKK.

Merkel

According to media reports, Merkel is so frustrated with AKK over a series of missteps by the new CDU party leader that the chancellor has decided to withdraw her political support, throwing her well-laid succession plans into disarray.

Merkel’s determination that AKK is not ‘up to the job’ of being chancellor comes as AKK and others within the CDU have pressured Merkel to step down early to give AKK a better shot at securing a full term in 2021.

Though her ability to influence the party is limited now that she has handed over control of the party’s machinery, Merkel can still throw a massive wrench in the works by deciding to spend no more political capital helping AKK, whose chances of winning the chancellorship are fading.

Merkel’s decision to withdraw support for her erstwhile protege is the latest sign that the longtime German leader is determined to stay on as Chancellor at least until her term ends in 2021, despite growing pressure from AKK and others within the party to step aside before the vote. The latest conflict between the two women erupted after AKK called an impromptu party conference next week to examine the CDU’s poor showing in the EU vote, a meeting that’ sure to produce some awkward encounters between Merkel and AKK.

And who knows? If the acrimony between the two female conservative leaders continues to intensify, Merkel may yet change her mind and decide to seek an unprecedented fifth term in office. She certainly has the popularity to make a credible go at it.

Even if she doesn’t actively campaign for AKK, Merkel has plenty of incentive to quit while she’s ahead. Not only was the CDU pummeled during the last two national elections, but AKK’s approval rating recently slipped three points to 36%, according to broadcaster ARD. That’s the lowest since she became CDU party leader, and almost 20 points behind Merkel. AKK’s standing has been hurt by a series of gaffes, including an off-color joke about transsexuals that alienated many moderates. Adding insult to injury, as the CDU’s popularity wanes, support for the progressive Greens has surged, with the party doubling its vote share to 20% last week compared with the 2014 EU Parliamentary elections.

If she presses ahead, we wouldn’t be surprised to see the chancellor draw comparisons to other infamous German authoritarians. Though conveniently, soon it will be time to distract from the possibility that Merkel will stay on as German emperor with speculation that Trump will ignore the results of the 2020 vote and refuse to give up the White House, or worse (for liberals), win in 2020 then decide to run for a third term.

But no matter what Merkel decides, for AKK, there might still be a way out.

zerohedge@zerohedge

Dear @akk any plans to declare Merkel a Stazi agent and stage a coup?5012:30 PM – May 28, 2019Twitter Ads info and privacy

(GUA) Jews in Germany warned of risks of wearing kippah cap in public

(GUA)

Government commissioner says lifting of inhibitions and rise of uncouthness are factors behind rising incidence of antisemitism

A man wearing a Jewish kippah skullcap with the flags of Germany and Israel.
 A man wearing a Jewish kippah skullcap with the flags of Germany and Israel. Photograph: Frank Rumpenhorst/AFP/Getty Images

Germany’s government commissioner on antisemitism has suggested Jews should not always wear the traditional kippah cap in public, in the wake of a spike in anti-Jewish attacks.

“I cannot advise Jews to wear the kippah everywhere, all the time, in Germany,” Felix Klein said in an interview published Saturday by the Funke regional press group. The remarks were criticised by the Israeli president as representing a “capitulation” to antisemitism.

In issuing the warning, Klein said he had “alas, changed my mind compared to previously”.

Antisemitic attacks are on the rise in a number of European countries, and a survey of Jewish people across the European Union carried out in December found 89% of Jews feel antisemitism has increased in their country over the past decade, while 85% believed it to be a serious problem.

Antisemitic hate crimes rose by 20% in Germany last year, according to interior ministry data, which blamed nine out of ten cases on the extreme right. There were 62 violent antisemitic attacks, compared to 37 in 2017. France has also seen a spike in violent incidents.

Klein, whose post was created last year, cited “the lifting of inhibitions and the uncouthness which is on the rise in society” as factors behind a rising incidence of antisemitism.

“The internet and social media have largely contributed to this, but so have constant attacks against our culture of remembrance.”

And he suggested police, teachers and lawyers should be better trained to recognise what constitutes “clearly defined” unacceptable behaviour and “what is authorised and what is not”.

Israeli President Reuven Rivlin said on Sunday that Klein’s remarks “shocked” him, and while appreciating the German government’s “commitment to the Jewish community,” accused it of bowing to those targeting Jews.

“Fears about the security of German Jews are a capitulation to antisemitism and an admittance that, again, Jews are not safe on German soil,” said Rivlin. “We will never submit, will never lower our gaze and will never react to antisemitism with defeatism – and expect and demand our allies act in the same way.”

The US ambassador to Germany, Richard Grenell, also criticised Klein’s advice. He wrote on Twitter: “The opposite is true. Wear your kippa. Wear your friend’s kippa. Borrow a kippa and wear it for our Jewish neighbors. Educate people that we are a diverse society.”

Antisemitism rising sharply across Europe, latest figures show

 Read more

The president of the Central Council of Jews in Germany welcomed the fact that government had recognised the seriousness of the situation. “It has for some time been the case that Jews in some cities potentially endanger themselves if they are visible as Jews”, Josef Schuster told news agency AFP.

The increased prominence of far-right parties in a number of European countries in the past few years has led to antisemitic and other extremist rhetoric that was previously confined to the fringes appearing more and more in the mainstream. In Germany, the arrival in parliament of the far-right AfD, whose leaders openly question the culture of atonement forsecond world war atrocities, has contributed to the change in atmosphere.

In Hungary, the nationalist government of Viktor Orbán has repeatedly been accused of anti-semitism, particularly in its campaigns against the financier and philanthropist George Soros, who is of Hungarian Jewish origin. Orbán has always denied the allegations and pointed out that, on the whole, Jews living in Hungary feel safe, unlike many living in western Europe. He has also criticised western Europe for accepting refugees and migrants from Muslim countries, claiming they bring antisemitism with them.

Klein acknowledged that the arrival of more than a million asylum seekers, many from Muslim countries such as Syria, Afghanistan or Iraq, has had an impact on the situation in Germany. Some were influenced by watching certain television channels “which transmit a dreadful image of Israel and Jews”, he said.

However, he emphasised that the far-right was to blame for the overwhelming majority of antisemitic crime.

“Antisemitism has always been here. But I think that recently, it has again become louder, more aggressive and flagrant,” Berlin’s top legal expert on antisemitism Claudia Vanoni said in a recent interview, adding the problem was “deeply rooted” in German society.

She also said the proliferation of online platforms that allow people to express extremist views without inhibition while hiding behind screens had fostered the rise in cases.

Justice minister Katarina Barley told the Handelsblatt newspaper the increase was “shameful for our country” but added that the police were “vigilant”.

Sabine Leutheuser-Scharrenberger, a former justice minister, said: “Everything has to be done to ensure that Jews can live their religion without facing danger and while relying on the rule of law”.

(BBC) Germany to return Portuguese Stone Cross to Namibia

(BBC)

The Stone Cross on display in a Berlin museum
Image captionThe Stone Cross was placed by the Portuguese in 1486 and features the country’s crest

The German Historical Museum has announced it will return a 15th century monument to Namibia after it was taken during the colonial era.

The Stone Cross is a Portuguese navigation landmark placed on the southwest African coastline in 1486.

But when the area was under German colonial control in the 1890s, the cross was taken and moved to Europe.

Namibia asked for its return in 2017 and on Friday, the Berlin museum formally agreed to the request.

Germany has pledged to return artefacts and human remains to its former colonies.

At a ceremony, German Culture Minister Monika Grütters said it was a “clear signal that we are committed to coming to terms with our colonial past”.

Namibia’s ambassador to Germany, Andreas Guibeb, called it “important as a step for us to reconcile with our colonial past and the trail of humiliation and systematic injustice that it left behind”.

A museum press release said the cross would be returned in August.

Namibia's Ambassador to Germany Andreas Guibeb posing with the Stone Cross
Image captionNamibia’s Ambassador to Germany Andreas Guibeb attended the event on Friday

Portuguese explorer Diogo Cão first placed the 3.5m (11ft) stone cross – featuring the country’s coat of arms – on Africa’s southwest coast during one of his expeditions.

It became so well known it featured on old maps of the area.

But a German naval commander took the cross in 1893, during the country’s control of what became Namibia between 1884 and 1915.

The German Historical Museum foundation’s president, Raphael Gross, wrote in the Frankfurter Allgemeine Zeitung that the cross represented “the slow beginning of colonial rule in present-day Namibia”.

A number of African nations have in recent years called on European museums to return artefacts taken away during the period of colonial control.

Experts recommended that French museums return African treasures to their countries of origin last year. President Emmanuel Macron announced 26 thrones and statues taken from Benin would go home shortly afterwards.

UK museums have also decided to repatriate artefacts to African countries.

The National Army Museum announced it would return a lock of Ethiopian Emperor Tewodros II’s hair in March, while the Victoria and Albert Museum offered to return Ethiopian treasures in November – albeit on loan.

P.O. (FT) Why Goldman Sachs should buy Deutsche Bank

P.O.

Personally i would love it to happen.
We would get rid of two evils:
The Vampires of Wall Street and the eternally broke Deutsche Bank.
DB problems, particularly the litigation problems,would eat the Vampires of Wall Street’s (Goldman Sachs) capital in no time.
As the French would say:
Bon debarras!
(Good riddance!)

Francisco (Abouaf) de Curiel Marques Pereira



(FT) Why Goldman Sachs should buy Deutsche Bank

US group wants growth in transaction banking and a German deal could help achieve that

(GUA) Merkel: Europe must unite to stand up to China, Russia and US

(GUA) German chancellor also shares views on Brexit and climate crisis in interview

Angela Merkel
 ‘There is no doubt that Europe needs to reposition itself in a changed world,’ said Merkel. Photograph: Hannibal Hanschke/Reuters

Europe must reposition itself to stand up to the challenges posed by its three big global rivals, China, Russia and the US, Angela Merkel has said before her final European election as German chancellor.

Facing challenges that range from Russian interference in elections to China’s economic clout and the US’s monopoly over digital services, Europe needs to get better at putting up a united front, Merkel said in a wide-ranging interview shared with the Guardian.

“There is no doubt that Europe needs to reposition itself in a changed world,” Merkel said in a conversation in her office in Berlin. “The old certainties of the post-war order no longer apply.”

She added: “They [China, Russia and the US] are forcing us, time and again, to find common positions. That is often difficult given our different interests. But we do get this done – think, for example, of our policy regarding the conflict in Ukraine.

“Our policies on Africa, too, now follow a common strategy, which a few years ago would have been unthinkable. So we keep putting one foot in front of the other. However, our political power is not yet commensurate with our economic strength.”

Merkel with Xi Jinping and Vladimir Putin at the G20 in Hamburg in 2017.
 Merkel with Xi Jinping and Vladimir Putin at the G20 in Hamburg in 2017. Photograph: Anadolu Agency/Getty Images

In the interview, conducted by journalists from the German newspaper Süddeutsche Zeitung and shared with the Guardian as part of the Europa newspaper alliance, Merkel also said:

  • Brexit was the biggest European turning point of recent years, but that the ball was now in the UK’s court: “In order for the UK to leave the EU, there needs to be a parliamentary majority in London for, rather than merely against, something.”
  •  Generating enough economic wealth to tackle the environmental crisis remained her “greatest worry”.
  • Germany was aiming to become carbon neutral by 2050, but this was “a tremendous challenge”.

Q&A

What is the Europa project?

Show

The interview comes at a pivotal moment in Merkel’s 14 years as chancellor. Her party, the Christian Democratic Union, faces the prospect of significant losses in the May 23-26 poll, though observers believe she remains popular enough to see out her fourth term through to 2021.

The elections are a chance for populists in Germany and across the continent to build on their mounting popularity, borne of greater inequality, growing precariousness and a disenchantment with politics in Brussels and in member states.

“Many people are concerned about Europe, including myself,” Merkel said. “This means I feel even more duty-bound to join others in making sure that Europe has a future.”

Why copying the populist right isn’t going to save the left

 Read more

She said her peers needed to stop toying with populist gestures, and categorically ruled out opening up her centre-right bloc of parties in the European parliament to far-right populists such as Matteo Salvini.

“This is indeed a time when we need to fight for our principles and fundamental values,” Merkel said. “The heads of state and government will decide how far to let populism go or if we are ultimately willing to take on joint responsibility.

“Simply stating that we’ve enjoyed seven decades of peace is no longer enough to justify the European project. Without forward-looking arguments to justify Europe, the European peace project would also be in greater jeopardy than one may think.”

Merkel also stressed the urgency of the global environmental crisis. A former environment minister in Helmut Kohl’s cabinet, Merkel recalled biodiversity conferences she attended in the mid-1990s, and said: “It is heartbreaking to see how the situation has worsened in so many ways.

Angela Merkel with Helmut Kohl
 Angela Merkel with the then chancellor, Helmut Kohl, in whose cabinet she served as environment minister. Photograph: AP

“There clearly is a lack of consistent political action, on a global scale. What is key for being able to act in all spheres, including environmental protection, is for us to be economically successful. That is my greatest worry.”

She reiterated her aim for Germany to achieve carbon neutrality by 2050, but said that for European countries to meet the net-zero carbon emissions target set by the French president, Emmanuel Macron, and eight other leaders last week, they would need to reopen a fraught debate about carbon capture and storage (CCS) technology.

“Nine countries intend to attain climate neutrality by 2050, whereby they would on average no longer emit any CO2,” Merkel said of Macron’s initiative. “I am firmly convinced that this can only be done if one is willing to capture and store CO2. The countries in question do not deny this. The method is called CCS – and for many in Germany it is a highly charged term.”

Empty North Sea gas fields to be used to bury 10m tonnes of C02

 Read more

CCS is controversial because critics see it as an expensive subsidy that would ultimately perpetuate rather than reduce reliance on fossil fuels. “There are two possibilities – you can either store carbon, or you can reforest on a large scale,” she said. “In the Netherlands, for example, the latter is not an option. There, CO2 could be pumped into empty gas fields. We could do the same in Germany – but if I wanted to implement this policy here with the stroke of a pen, then people would be right to ask me how realistic that is.”

Merkel would not say whether the EU would grant Britain another extension if Theresa May’s government failed to pass her withdrawal agreement by the end of October deadline.

And, asked whether by the autumn Brexit might be being discussed by new leaders in both London and Berlin, she again refused to be drawn, answering: “Should there be anything to negotiate, the European commission will do so on behalf of the 27 member states, as it has done so far.”

(Reuters) Exclusive: UniCredit advances toward bid for Germany’s Commerzbank – sources

(Reuters)

FRANKFURT/LONDON (Reuters) – UniCredit has stepped up preparations for a potential bid for Germany’s Commerzbank by drafting in investment bankers including a former top German official, three people familiar with the matter said.FILE PHOTO: A sign for an ATM of Commerzbank is seen next to the headquarters of Deutsche Bank (R) in Frankfurt, Germany, March 19, 2019. REUTERS/Kai Pfaffenbach/File Photo

The Italian bank had engaged Lazard and its banker Joerg Asmussen, the former German deputy finance minister, along with JP Morgan for a possible takeover, the sources said, raising the prospect of a deal that could allow UniCredit to pivot away from its struggling domestic market.

UniCredit said in statement responding to the Reuters report that it wanted to clarify that no banking mandate had been signed in relation to any potential market operation.

The bank reiterated that its current business plan is based on organic growth and a new plan will be unveiled on Dec. 3.

Although it is unclear whether and when a bid could be made, UniCredit has long been interested in expanding in Germany, said several sources familiar with management’s thinking. It already owns HVB, a large German lender based in Munich.

But the Italian bank, which has been concentrating on its own turnaround plan, had been waiting on the outcome of merger talks between Commerzbank and its larger Frankfurt neighbor, Deutsche Bank.

Those talks unraveled in recent weeks, placing Commerzbank back on the agenda for UniCredit Chief Executive Jean Pierre Mustier, who will be running the rule over a target worth about 9.3 billion euros ($10.4 billion) compared with UniCredit’s market capitalization of 24.4 billion euros.

Commerzbank shares rose on the news, climbing 4.7% by 1400 GMT, with UniCredit shares down 2.4%.

UniCredit’s advances come as Dutch bank ING Groep has also shown interest in Commerzbank, sources familiar with the matter said. One person with knowledge of those informal talks described them as “intensive”.

Mustier has hired Lazard in the hope that Asmussen can lobby for the deal with finance minister Olaf Scholz. Both have roots in the German Social Democrat Party.

Asmussen, who studied business administration at Milan’s Bocconi University, has previously served on the executive board of the European Central Bank (ECB) and as state secretary at the Federal Ministry of labor and social affairs.

UniCredit, JPMorgan, Lazard, Commerzbank and Germany’s finance ministry declined to comment while Asmussen did not immediately respond to a request for comment.

ING also declined to comment.

JOB FEARS

The success of any approach will hinge in part on the German government, which owns a 15 percent stake in Commerzbank, stemming from a bailout during the financial crisis. Some officials had hoped to keep Commerzbank in German hands, which is why they pushed for a deal with Deutsche Bank.

One German official said the government would be open to a merger between Commerzbank and a foreign European rival, such as UniCredit.Slideshow (2 Images)

But a deal that would tie one of Germany’s biggest banks to debt-laden Italy could ultimately prove hard to sell in Berlin.

If a takeover does emerge, it would be one of the largest deals involving banks across European borders since the financial crisis. Such mergers are still hard to pull off because laws and regulations still vary from country to country despite the single market, bankers say.

However, any initiation of talks is sure to ruffle feathers at Commerzbank, where employees – fearful for their jobs – had overwhelmingly opposed a tie-up with Deutsche Bank. Unions had forecast as many as 30,000 lost jobs.

Analysts at Citi said that any tie up with UniCredit could make it cheaper for the bank to refinance its operations and trigger other cost savings.

UniCredit last week announced that it was reducing its exposure to Italy to boost its financial strength, with measures including cuts to its portfolio of Italian government bonds.

That move could strengthen prospects for an acquisition in Germany, where UniCredit’s high exposure to Italy is seen as a barrier to a deal, several bankers said.

UniCredit had 54 billion euros of Italian government bonds at the end of March.

Italian UniCredit shareholders are in favor of any deal that can boost its market value, but some want the bank to retain its Italian identity, a person close to the matter said.

Mustier last week said that the bank was very proud of being listed and headquartered in the euro-zone’s third-biggest economy.

(GUA) German police shut down one of world’s biggest dark web sites

(GUA) Arrests in Germany, Brazil and US relate to sale of drugs, stolen data and malicious software

Bits of computer hardware
 Evidence presented at the press conference announcing the closure of the ‘Wall Street Market’ darknet platform. Photograph: Silas Stein/AP

German police have shut down one of the world’s largest illegal online markets in the so-called dark web and arrested the three men allegedly running it, prosecutors said on Friday.

The “Wall Street Market” (WSM) site enabled trade in cocaine, heroin, cannabis and amphetamines as well as stolen data, fake documents and malicious software.

The encrypted platform had more than 1m customer accounts, over 5,000 registered sellers and more than 60,000 sales offers, according to Frankfurt prosecutors and affidavits filed by US prosecutors in a federal court in Los Angeles.

“WSM operated like a conventional e-commerce website, such as eBay and Amazon. However, its sole existence was geared to the trafficking of contraband,” US prosecutors said.

Three German men alleged to be administrators of the site were arrested, while a fourth man – a Brazilian who, prosecutors said, acted as an online mediator for the website – was arrested in Brazil.

Klaus-Martin Frost, Jonathan Kalla and Tibo Lousee are accused of running Wall Street Market for nearly three years, providing a darknet platform for the sale of narcotics, counterfeit goods and hacking software to 1.1 million customers.

The Germans, known to investigators by the monikers “coder420”, “Kronos” and “TheOne”, also face charges in Germany.

“While they lurk in the deepest corners of the internet, this case shows that we can hunt down these criminals wherever they hide,” US attorney Nick Hanna said in a written statement announcing the charges.

Among the site’s top vendors were two people based in Los Angeles: “Ladyskywalker”, who sold opiates such as fentanyl, hydrocodone and oxycodone, and “Platinum45”, who dealt in methamphetamine, oxycodone and a combined amphetamine prescription drug marketed as Adderall.

The people operating those accounts have also been arrested, according to the criminal complaint. Their names have not been made public.

Launched in 2016, WSM grew over the past three years to be the largest darknet site after the 2017 shutdown of the notorious AlphaBay and Hansa marketplaces.

The site was accessed through the encrypted Tor network to shield customers from detection and transactions were made with the cryptocurrencies bitcoin and Monero.

It offered interfaces in six languages – English, French, German, Italian, Portuguese and Spanish – and numerous separate categories for merchandise, including drugs, jewellery, equipment and support for credit card fraud, software and malware, among others. One vendor category, according to the court filings, was simply named “fraud”.

Like legal online marketplaces, buyers could search by product, product popularity, vendor ratings, payment type and price. The operators allegedly received commissions of between 2% and 6% of the sales value.

The police operation started after Finnish authorities shut down the illegal Tor trade site Silkkitie (Valhalla) earlier this year, said Europol. This led some Finnish narcotics traders to move to WSM.

In April, the WSM administrators were apparently alarmed at the sudden surge of customers and, the court documents said, enacted an exit plan that involved freezing the escrow accounts and customer wallets and taking out all the virtual currency held in them at the time – estimated at $11m (£8.3m).

That spurred investigators to act, and on 23 and 24 April they arrested the three German suspects, aged 22 to 31, in the states of Baden-Württemberg, Hesse and North Rhine-Westphalia.

They also seized servers, more than €550,000 (£470,000) in cash, and hundreds of bitcoin and Monero, as well as several vehicles and a gun.

(ZH) Deutsche Bank Back To ‘Square One’ As Commerzbank Merger Talks Collapse

(ZH)

Ever since it became apparent that the Deutsche Bank-Commerzbank tie-up wasn’t meant to be after all, despite incessant lobbying from the German Finance Ministry over the objections of pretty much every other stakeholder, both Deutsche Bank shareholders as well as the bank’s still-relatively-new CEO have probably been wondering: What’s next for Europe’s least-favorite perennially troubled megabank? 

DB

Well, as DB’s management team scrambles to close a deal with UBS to merge the Swiss bank’s once-storied asset-management business with DWS, the asset-management arm that functions as a separate corporate entity controlled by Deutsche, Bloomberg and the FT have effectively confirmed what most shareholders have been hoping for: Despite Sewing and Chairman Paul Achleitner’s insistence that the investment bank is vital to Deutsche’s future, it’s probably time for Deutsche to take an axe to its long-suffering investment bank (the bank has already reportedly been considering the ring-fencing of its most toxic businesses and assets in a shadow ‘bad bank’).

Specifically, the bank’s equities business (and more specifically, it’s US equities trading business) will likely be on the chopping block.

But even a restructuring would be difficult, coming with many up-front costs, according to analysts quoted by Bloomberg:

With a Commerzbank deal gone, Deutsche Bank’s only move is “a more radical investment bank restructure, with a potential exit from the U.S. region and the equities product line,” Citigroup Inc. analysts wrote in a note on April 29. Such a move would be difficult. Restructuring costs would hit upfront, and revenue would be squeezed at first, potentially exacerbating rather than fixing Deutsche Bank’s core problem. In any case, that option seems off the table. Achleitner and Sewing say the trading and corporate finance businesses are crucial. “Every executive has to constantly adjust to a changing market environment,” Achleitner told the Financial Times. “But in this regard, we are not talking about strategy, we are talking about execution” of the existing plan.

As if the bank needed another incentive, Reuters reported a few days back that Deutsche’s US operation – which would be greatly curtailed  or shuttered entirely in a restructuring – is once again in danger of failing one of the Fed’s stress tests.

In a detailed insider account of the factors that inspired Sewing’s decision to walk away from merger talks (according to the FT, though it had been announced as a mutual decision, the idea to walk away was first broached by Sewing and his team, who argued that financing the deal would be too burdensome).

As one regulator put it:

“Calling the merger off wasn’t a strategic decision,” a top regulator said. “They could just not afford the deal.”  “Without the one-off [accounting and tax] effects the transaction would have triggered, the deal stacked up,” the person said, adding it was “unsettling…[that] both banks do not have enough firepower to bring forward a merger that makes strategic sense.” Deutsche disputes that it lacked firepower to do the deal.

But while Commerzbank’s steady corporate business will make it an ideal acquisition target for another European lender (UniCredit and ING have reportedly been weighing bids), DB has no obvious path to finally shed the mantle of ‘most hated bank in Europe’.

DB

(CNBC) Germany reportedly won’t exclude Huawei 5G technology — if the company follows the rules

(CNBC)

  • Germany has no plans to stop Chinese telecom giant Huawei from participating in the build up of ultra-high speed internet, known as 5G, in the country if it complies with security requirements.
  • Jochen Homann, president of the country’s telecommunications regulator, told the FT newspaper that no equipment suppliers, including Huawei, “should, or may, be specifically excluded.”
  • Homann told the FT that his agency has yet to see evidence that Huawei poses a security risk.
CNBC Tech: Huawei MWC 2019 1

One of Huawei’s booths at MWC Barcelona 2019.Elizabeth Schulze | CNBC

Germany has no plans to stop Chinese telecommunications giant Huawei from participating in build up of ultra-high speed internet, known as 5G, in the country if it complies with all the security requirements, the Financial Times reported on Sunday.

The president of the Bundesnetzagentur, the country’s telecommunications regulator, told the FT that no equipment suppliers, including Huawei, “should, or may, be specifically excluded.”

Jochen Homann told the newspaper that his agency has yet to see evidence that Huawei poses a security risk. He added that if Huawei meets the security requirements imposed by the regulator, it can take part in the 5G network roll-out.

Huawei is up against mounting worries that its technology will enable Chinese espionage through those high-speed mobile networks. The United States banned Huawei from selling 5G networking equipment to U.S. firms. Other countries have followed suit, including Australia, Japan and New Zealand. Huawei claims the security concerns are unfounded.

The European Union so far has shunned U.S. calls to ban Huawei. The United Kingdom, a close ally of Washington, acknowledged ‘significant’ security risks posed by Huawei but has, so far, not moved to ban the firm outright.

In an interview with CNBC’s Arjun Kharpal on Saturday, Huawei CEO Ren Zhengfei said his company will comply with European cybersecurity standards and the General Data Protection Regulation (GDPR) laws that govern the European Union.

“Germany proposed the establishment of a unified global convention that would bar all equipment vendors from installing backdoors, and require them to sign a no-spy agreement,” he said, referring to a potential “no spy” deal between Berlin and Beijing.WATCH NOWVIDEO01:13Huawei CEO: We support Germany’s proposed ‘no-spy agreement’

In 5G networks, the emphasis is more on software instead of hardware. That means an equipment maker may be able to install lines of code, called “backdoors,” that let it access what’s going on inside the network — such as monitoring data transfers, tracking locations of cell phone users, or eavesdropping on conversations.

“We endorse unified global standards that make installing backdoors a crime … we want to sign such an agreement because we think it’s the right thing to do,” Ren said.

Ren added that Huawei will invest more than $100 billion in research and development over the next five years: “We will build the simplest networks, ensure cyber security, and protect user privacy.”

The Trump administration, meanwhile, warned the German government it would limit intelligence-sharing if Berlin allows Huawei to build its 5G infrastructure, the Wall Street Journal reported last month.

Read more about the German regulator’s stance on Huawei from the Financial Times here.

(CNBC) Commerzbank shares rise on report UniCredit plans to make a rival bid if Deutsche talks fail

(CNBC)

  • A report says UniCredit is prepared to make a multibillion-euro offer for a sizable stake in Commerzbank.
  • Commerzbank would reportedly be merged with German Unicredit subsidiary HypoVereinsbank.
  • Shares of Commerzbank were up around 3 percent in morning trade on the back of the news.

Ryan Browne@Ryan_Browne_Published 5 Hours Ago  Updated 2 Hours AgoCNBC.com

Picture taken on March 17, 2019 shows the headquarters of German banks Deutsche Bank (L) and Commerzbank in Frankfurt am Main, western Germany.

FRANK RUMPENHORST | DPA | Getty ImagesPicture taken on March 17, 2019 shows the headquarters of German banks Deutsche Bank (L) and Commerzbank in Frankfurt am Main, western Germany.

Commerzbank shares rose following a report that UniCredit stands ready to make a rival bid for the bank if merger talks with fellow German lender Deutsche Bank fail.

The Financial Times, citing people familiar with the matter, reported Thursday that the Italian bank was prepared to make a multibillion-euro offer for a sizable stake in Commerzbank.

Commerzbank would be merged with German Unicredit subsidiary HypoVereinsbank, the FT reported, and the combined entity would be based in Germany while UniCredit maintains its headquarters and listing in Milan.

Shares of Commerzbank were up around 3 percent in morning trade on the back of the news.

Commerzbank declined to comment. UniCredit was not immediately available when contacted by CNBC.

While the German government’s stance on this remains unclear, it has been speculated that a Deutsche Bank-Commerzbank tie-up would be seen as favorable as it would create a domestic banking champion. A deal with UniCredit would mean a foreign lender taking control of Germany’s second-largest bank.

Commerzbank’s executive board is reportedly set to decide whether to intensify discussions with Deutsche Bank — or back away from a deal — on April 9.

(Reuters) Commerzbank to decide on April 9 on merger talks with Deutsche: WiWo

(Reuters)

BERLIN (Reuters) – Commerzbank’s executive board is due to decide on April 9 whether to intensify merger talks with Deutsche Bank or back away from a deal, German business weekly Wirtschaftswoche said on Wednesday.

The magazine said Commerzbank’s management is scheduled to discuss how to proceed in the merger talks during its next regular session, Wirtschaftswoche added, citing company sources and an internal memo.

Commerzbank and Deutsche Bank declined to comment.

Upon initiating formal talks with Deutsche Bank on March 17, Commerzbank chief executive officer Martin Zielke told bankers that management aimed for a decision on whether to go forward with a merger in the next two to three weeks, two sources with knowledge of the matter said at the time.

In a memo to employees days later, Zielke wrote: “I can promise you that we will strive to keep this period of uncertainty as short as possible and we will work hard to ensure that a decision is reached soon.”

Deutsche Bank supervisory board chairman Paul Achleitner said that the banks aim to announce more concrete steps on the merger by late April.

(EUobserver) France and Germany to co-chair UN security council

(EUobserver)

France and Germany are to share the rotating presidency of the UN security council (UNSC). Unlike France, Germany serves as a non-permanent member of the UNSC. German foreign Minister Heiko Maas said Monday the country planned on using its role to “strengthen long-term conflict prevention.” France previously rejected German appeals to convert its permanent UNSC seat into an EU one.

(ShareCast) Deutsche Bank considering raising billions of extra capital – report

(ShareCast) Shares in Deutsche Bank have slipped following reports that the bank is considering raising as much as €10bn as part of ongoing merger negotiations with smaller rival Commerzbank.

Sources familiar with the talks were quoted as saying that between €3bn and €10bn of extra capital could be raised by issuing fresh equity. Such a move would help assuage concerns about whether Germany’s biggest lender has enough capital, according to theFinancial Times. The newspaper said that at the end upper end of the range, the capital increase would equal about 40% of the two bank’s combined market capitalisation.

But investors, many of which have yet to be convinced about the economies of a deal, were not convinced, and sent the stock 3% lower by 1230 GMT. Commerzbank was off 2%.

Further depressing the shares was a report by Reuters, which alleged first-quarter trading at Deutsche Bank had been weak. It quoted an unnamed source familiar with the business, who claimed: “January was catastrophic, February was bad and March got slowly better.”

A tie-up between the two banks has long been speculated, and both sides finally confirmed merger talks were underway earlier this month.

Deutsche Bank is a leading player in the global banking sector but in recent years has endured boardroom battles, been fined for failing to prevent money laundering and has seen persistent declines in revenues.

Commerzbank, meanwhile, is seen as vulnerable to foreign takeover, and it is understood there was mounting political pressure for the two banks to consider a tie up.

Deutsche Bank told the FT it was “much too early at this stage of the due diligence process to make a credible assessment if there is any potential capital need at all”.

(Reuters) Deutsche Bank and Commerzbank go public on merger talks

(Reuters)

FRANKFURT (Reuters) – Deutsche Bank and Commerzbank confirmed on Sunday they were in talks about a merger, prompting labor union concerns about possible job losses and questions from analysts about the merits of a combination.FILE PHOTO: Banners of Deutsche Bank and Commerzbank are pictured in front of the German share price index, DAX board, at the stock exchange in Frankfurt, Germany, September 30, 2016. REUTERS/Kai Pfaffenbach/File Photo

Germany’s two largest banks issued short statements following separate meetings of their management boards, a person with knowledge of the matter said, indicating a quickening of pace in the merger process, although both also warned that a deal was far from certain.

“In light of arising opportunities, the management board of Deutsche Bank has decided to review strategic options,” Deutsche said in its statement.

Christian Sewing, Deutsche Bank’s chief executive, told employees that Deutsche still aimed “to remain a global bank with a strong capital markets business… with a global network”.

Sewing said many factors could still prevent a merger and a Deutsche spokesman said the talks were expected to last some time. Commerzbank described the outcome as open.

RELATED COVERAGE

However, formal disclosure of talks appeared to boost the chances of concluding a deal first floated in 2016 before the banks opted to focus on restructuring.

The German government has pushed for a combination given concerns about the health of Deutsche, which has struggled to generate sustainable profits since the 2008 financial crisis.

The government, which holds a stake of more than 15 percent in Commerzbank following a bailout, wants a national banking champion to support its export-led economy, best known for cars and machine tools.

Berlin also wants to keep Commerzbank’s speciality – the funding of medium-sized companies, the backbone of the economy – in German hands.

“SHAKY ZOMBIE BANK”

A merged bank would likely be the third largest in Europe after HSBC and BNP Paribas, with roughly 1.8 trillion euros ($2.04 trillion) in assets, such as loans and investments, and a market value of about 25 billion euros.

However, sceptics questioned the wisdom of a merger.

“We do not see a national champion here, but a shaky zombie bank that could lead to another billion-euro grave for the German state. Why should we take this risk?” said Gerhard Schick, finance activist and ex-member of the German parliament.

While the banks had not publicly commented on merger talks until Sunday, Finance Minister Olaf Scholz last Monday confirmed that there were negotiations.

On Sunday, the ministry acknowledged the announcement and said it remained in regular contact with all parties.

However, there were signs of political opposition.

Hans Michelbach, a lawmaker from the Christian Social Union (CSU), the Bavarian sister party of Chancellor Angela Merkel’s Christian Democratic Union (CDU), urged the government to sell its 15 percent stake in Commerzbank before a deal.

“There may not be an ownership by the federal government in a merged big bank indirectly through an old stake. We do not need a German State Bank AG,” he told Reuters.

The supervisory boards of both banks are scheduled to hold long-planned meetings on Thursday, four people with knowledge of the matter told Reuters. The status of merger negotiations is expected to be discussed.

A merged bank would have one fifth of the German retail banking market. Together the two banks currently employ 140,000 people worldwide – 91,700 in Deutsche and 49,000 in Commerzbank.

Germany’s Verdi labor union on Sunday renewed its objections to a merger, saying that tens of thousands of jobs were at risk and that a tie-up added no value.

Jan Duscheck, head of the union’s banking division and a member of Deutsche’s supervisory board, said the union would raise its concerns on both banks’ oversight bodies.

U.S. authorities investigate FAA approval of Boeing plane: WSJ

RISKS

Deutsche emerged unscathed from the financial crash but later lost its footing. German officials fear a recession or big fine could derail the bank’s fragile recovery.

Other than Deutsche, Commerzbank is Germany’s only remaining big publicly-traded bank, after a series of mergers.

Commerzbank has also struggled to rebound, and German officials say it is vulnerable to a foreign takeover. If an international rival snapped it up, that would increase competition for Deutsche on its home turf.

Initial reaction among analysts to a deal was skeptical.

There will only be limited benefits of adding Commerzbank’s clientele of retail and small and medium businesses to Deutsche, said David Hendler, an independent analyst at New York-based Viola Risk Advisors, which specializes in risk management.

“It doesn’t change the fact that Germany is not getting a flagship bank that can compete on the world stage. It’s still a stunted bank with a lot of problems,” Hendler said.

One of the biggest risks is how to fill what one German official has told Reuters will be a multi-billion-euro financial hole because a merger could trigger an adjustment to the valuation of some bank investments.

Commerzbank, for example, has about 30.8 billion euros of debt securities such as Italian bonds that now have a value of 27.7 billion euros. A tie-up could crystallize this loss. Deutsche has such securities at market value in its accounts.

(BBG) Volkswagen CEO Apologizes for Phrase Similar to Nazi Slogan

(BBG)

  •  ‘Ebit macht frei’ comment was made at internal company event
  •  Diess is ‘deeply sorry’ for causing any unintentional pain
Herbert Diess
Herbert Diess Photographer: Andrew Harrer/Bloomberg

LISTEN TO ARTICLE 2:42SHARE THIS ARTICLEShareTweetPostEmailIn this articleVOWVOLKSWAGEN AG148.90EUR+2.10+1.43%NSUAUDI AG788.00EUR-10.00-1.25%

Volkswagen AG Chief Executive Officer Herbert Diess apologized for his use of a phrase that appeared to play on the slogan on the gates of the Auschwitz concentration camp, “Work sets you free.”

Diess said “Ebit macht frei” during an internal Volkswagen event, in a reference to the abbreviation for earnings before interest and taxes, evoking the Nazi slogan “Arbeit macht frei.” The misstep coincided with a notice that the U.S. Securities and Exchange Commission has sued VW over the diesel emissions cheating scandal.

“It was in fact, a very unfortunate choice of words and I am deeply sorry for any unintentional pain I may have caused,” Diess wrote in a post on his LinkedIn page. “For that I would like to fully and completely apologize.”

The comments are all the more unfortunate considering Volkswagen’s history. The automaker was founded by the German government in 1937 to mass-produce a low-priced car, and was originally operated by the German Labour Front, a Nazi organization. Volkswagen, whose factory was repurposed during World War II to build military equipment and vehicles, is today the world’s biggest automotive group with brands including Audi, Bugatti, and Porsche.

The expression ‘Ebit macht frei’ was made in an internal management presentation in connection with operating margins from various company brands, Diess said. Within Volkswagen, “brands with a higher margins have more freedom within the Group to make their own decisions. My comment was made within this context,” he said.

The CEO said it wasn’t his intention to make this expression in a way that could be misinterpreted, and he didn’t consider the possibility that it could be.

“Volkswagen has undertaken many activities over the last 30 years that have made the company, myself personally and our employees fully aware of the historical responsibility Volkswagen bears in connection with the Third Reich,” Diess wrote.

VW’s powerful works council welcomed Diess’s “swift clarification and unequivocal apology” for the remark, adding that remembrance and responsibility are part of the company’s DNA.

Read here for more on the SEC suit over VW misleading bondholders

Since Diess, 60, took over as CEO last April, he’s struggled to put the 3 1/2-year-old diesel cheating scandal in the past. In the latest twist, the SEC said Thursday it was suing the carmaker for failing to disclose to investors that its diesel vehicles violated emission standards.

“The investors did not know that VW was lying to consumers to fool them into buying its ‘clean diesel’ cars and lying to government authorities in order to sell cars in the U.S. that did not comply with U.S. emission standards,” the SEC alleged.

VW said the SEC complaint is “legally and factually flawed” and the company will “contest it vigorously.” It accused the SEC of “piling on to try to extract more from the company” more than two years after settlements with the Justice Department.