What Germany Can And Can’t Do To Improve Its Image

In the wake of the showdown over the Greek debt crisis, Germany has wound up in the role of European bad guy. Germans ask if there's a way to make things better.

Protesters wearing Schauble and Merkel masks in Athens
Protesters wearing Schauble and Merkel masks in Athens
Yannick Nock

BERLIN â€" Not too long ago Europe was calling for Germany to take charge. Many European countries demanded that Chancellor Angela Merkel take the helm, bear the responsibility of managing the Eurozone's debt crisis, be a shining example of courageous leadership. Polish Foreign Minister Radoslaw Sikorski shared that sentiment with this pithy quote back in 2011: "I fear German power less than I am beginning to fear Germany inactivity."

But these voices have faded now. Much of the international media is condemning the stringent austerity conditions imposed upon Athens in the recent Eurozone negotiations. "It is not terrorists nor Euro-skeptics nor populists who are the biggest threat to Europe, it is Schäuble," wrote Portuguese daily Publico, referring to Germany's Finance Minister Wolfgang Schäuble.

Twitter was swamped by protests, using #ThisIsACoup and #BoycottGermany hashtags. The ghosts of the pasts have returned with thunderous style.

Déjà vu (1933) #BoycottGermany

â€" Toniariza (@toniariza) July 13, 2015

But the anger directed at Germany is not just based on historical events. "The (German) Federal Government is also responsible for the damaged image that Germany has to live with," says European studies expert Roderick Parkes, who used to head the Brussels branch of the German Institute for International and Security Affairs (SWP).

Parkes says leaders in Germany and elsewhere have had the illusion that cultural and political differences across Europe are easily surmountable. "Politicians are of the opinion that Europeans know and understand one another," he says, "but in reality we don’t."

Batten down

The reality requires a major new dose of what we call "public diplomacy," that is the conscious exchange between a state and the people of another nation. This may be done these days via social media outlets, such as Twitter or Facebook, or through articles published in newspapers. Official state visits as well as envoys and ambassadors who are promoting mutual understanding abroad are also part of public diplomacy.

Almut Möller, head of the Alfred von Oppenheimer Centre of European Policy Studies, has, since the beginning of the crisis, pointed out the importance of public diplomacy. "Berlin has to develop a convincing public diplomacy towards other states in crisis," says Möller.

German leaders cannot allow their country to be seen as being disinterested in the debate or only wanting to push through its own objectives behind closed doors.

Möller suggests that the Federal Government should approach opinion leaders in the media and EU think tanks to justify their positions during the financial crisis â€" and to also respond directly to any criticisms. "Why did representatives of the Federal Government or even the Chancellor herself not visit those countries that suffered most from the financial crisis?," asks Möller. "Where are the visible gestures of support during the ongoing reforms?"

The German government is aware of the importance of public diplomacy, but it now requires greater effort, especially from those in the top positions, to avoid the risk that more and more nations move away from the idea of a unified Europe. "There is a wider European public that German leaders have to address," Möller adds.

But beyond reaching out directly to the people of other countries, European diplomats have to do better at forging alliances to improve the chances of mutual comprehension. Parkses cites the so-called "Sauna Diplomacy" of former Chancellor Helmut Kohl, which he says is non-existent in Brussels nowadays. "Interpersonal relationships have lost their importance," he concludes.

How effective the occasional pat on the shoulder and public diplomacy really are is a disputable topic. "A smile or a kind gesture doesn’t change anything," counters Swiss political scientist Dieter Freiburghaus. The "authenticity" of the Chancellor alone is decisive, and Merkel is indeed an authentic person. The press headlines and social media hysteria, however, do not convey an authentic picture of Europe.

Freiburghaus says countries such as Finland, the Netherlands and Austria are glad that they can hide behind Merkel’s broad shoulders. And thus Germany’s approach during a media thunderstorm is to don the waterproofs and let hostility simply wash over. "You cannot make difficult decisions and be loved for doing so at the same time," Freiburghaus says.

Keep up with the world. Break out of the bubble.
Sign up to our expressly international daily newsletter!

Air Next: How A Crypto Scam Collapsed On A Single Spelling Mistake

It is today a proven fraud, nailed by the French stock market watchdog: Air Next resorted to a full range of dubious practices to raise money for a blockchain-powered e-commerce app. But the simplest of errors exposed the scam and limited the damage to investors. A cautionary tale for the crypto economy.

Sky is the crypto limit

Laurence Boisseau

PARIS — Air Next promised to use blockchain technology to revolutionize passenger transport. Should we have read something into its name? In fact, the company was talking a lot of hot air from the start. Air Next turned out to be a scam, with a fake website, false identities, fake criminal records, counterfeited bank certificates, aggressive marketing … real crooks. Thirty-five employees recruited over the summer ranked among its victims, not to mention the few investors who put money in the business.

Maud (not her real name) had always dreamed of working in a start-up. In July, she spotted an ad on Linkedin and was interviewed by videoconference — hardly unusual in the era of COVID and teleworking. She was hired very quickly and signed a permanent work contract. She resigned from her old job, happy to get started on a new adventure.

Others like Maud fell for the bait. At least ten senior managers, coming from major airlines, airports, large French and American corporations, a former police officer … all firmly believed in this project. Some quit their jobs to join; some French expats even made their way back to France.

Share capital of one billion 

The story began last February, when Air Next registered with the Paris Commercial Court. The new company stated it was developing an application that would allow the purchase of airline tickets by using cryptocurrency, at unbeatable prices and with an automatic guarantee in case of cancellation or delay, via a "smart contract" system (a computer protocol that facilitates, verifies and oversees the handling of a contract).

The firm declared a share capital of one billion euros, with offices under construction at 50, Avenue des Champs Elysées, and a president, Philippe Vincent ... which was probably a usurped identity.

Last summer, Air Next started recruiting. The company also wanted to raise money to have the assets on hand to allow passenger compensation. It organized a fundraiser using an ICO, or "Initial Coin Offering", via the issuance of digital tokens, transacted in cryptocurrencies through the blockchain.

While nothing obliged him to do so, the company owner went as far as setting up a file with the AMF, France's stock market regulator which oversees this type of transaction. Seeking the market regulator stamp is optional, but when issued, it gives guarantees to those buying tokens.

screenshot of the typo that revealed the Air Next scam

The infamous typo that brought the Air Next scam down

compta online

Raising Initial Coin Offering 

Then, on Sept. 30, the AMF issued an alert, by way of a press release, on the risks of fraud associated with the ICO, as it suspected some documents to be forgeries. A few hours before that, Air Next had just brought forward by several days the date of its tokens pre-sale.

For employees of the new company, it was a brutal wake-up call. They quickly understood that they had been duped, that they'd bet on the proverbial house of cards. On the investor side, the CEO didn't get beyond an initial fundraising of 150,000 euros. He was hoping to raise millions, but despite his failure, he didn't lose confidence. Challenged by one of his employees on Telegram, he admitted that "many documents provided were false", that "an error cost the life of this project."

What was the "error" he was referring to? A typo in the name of the would-be bank backing the startup. A very small one, at the bottom of the page of the false bank certificate, where the name "Edmond de Rothschild" is misspelled "Edemond".

Finding culprits 

Before the AMF's public alert, websites specializing in crypto-assets had already noted certain inconsistencies. The company had declared a share capital of 1 billion euros, which is an enormous amount. Air Next's CEO also boasted about having discovered bitcoin at a time when only a few geeks knew about cryptocurrency.

Employees and investors filed a complaint. Failing to find the general manager, Julien Leclerc — which might also be a fake name — they started looking for other culprits. They believe that if the Paris Commercial Court hadn't registered the company, no one would have been defrauded.

Beyond the handful of victims, this case is a plea for the implementation of more secure procedures, in an increasingly digital world, particularly following the pandemic. The much touted ICO market is itself a victim, and may find it hard to recover.

Keep up with the world. Break out of the bubble.
Sign up to our expressly international daily newsletter!