German Chancellor Olaf Scholz and French President Emmanuel Macron will hold a joint cabinet meeting in Paris today.
The Berlin-Paris axis has struggled in recent years as disagreement proliferated between the two over energy, defense and more. Tensions rose further in October when Macron publicly snubbed Scholz by canceling a planned joint press conference. Now, Germany is dragging its heels amid French pressure to send tanks to Ukraine.
Yet, a new issue may reunite them. America’s Inflation Reduction Act (IRA)—which offers subsidies for US companies to invest on US soil—stoked fear that American investment in Europe will dry up, and led to joint cries of anti-competitive practices from Berlin and Paris.
Today’s summit will likely work to initiate a reset of the Franco-German relationship—that it occurs on the 60th anniversary of the countries’ official post-WWII reconciliation is no coincidence. Although its internal squabbles persist, Europe is strongest when confronting external issues, as Russia’s invasion of Ukraine demonstrated. IRA provides a new external threat to unify against.
Although Berlin typically toes Washington’s line on trade disputes, it has already backed French resistance to the legislation. If a negotiated solution with Washington fails to appease European leaders, expect the two to push for increased rival European measures – which risks starting a subsidies war
Jon is a Content Editor and Analyst within the Analysis division of Foreign Brief.