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Geopolitics

Merkozy Is Dead, Long Live The Franco-German Alliance

Angela Merkel openly supported Nicolas Sarkozy during France’s just concluded presidential campaign. Now that her man was beaten by Socialist candidate François Hollande, Merkel is ready to make concessions on growth, but won’t budge on deficit.

Auf wiedersehen Nicolas (Sebastian Zwez)
Auf wiedersehen Nicolas (Sebastian Zwez)
Nathalie Versieux

BERLIN – Germany may welcome Francois Hollande with "open arms," but Angela Merkel has already made one thing very clear: "The fiscal pact is not up for discussion."

The German chancellor was pulling for Nicolas Sarkozy to be reelected. She will now have to get used to a new partner whom she barely knows. Indeed, she refused to meet François Hollande during the French presidential campaign.

"There were contacts beforehand. The debate wasn't always easy, but discussions took place and both teams are now better prepared to each other than in 2007," says Chantal Mairesse from the Genshagen Foundation. That's also because, unlike Nicolas Sarkozy five years ago, Hollande has several Germanophiles among his top advisors.

"Between France and Germany, it's not about people," says German member of Parliament Andreas Schockenhoff. "Both teams will have to work in a constructive fashion and not waste time."

Merkel's real worry isn't the new French president, but financial markets that seem – at least from Berlin – to be waiting for Paris to quickly express support for the fiscal pact, before the Irish referendum later this month. Insiders of Merkel's party, the CDU, say that if France is seen dragging its feet, the Irish will say ‘No" to the pact -- and that will be the end of the common currency.

The "G" word

On both sides of the Rhine, commentators believe the new French president won't clash head on with German interests. Merkel is also aware that she will have to soften her stance.

In recent speeches, the German chancellor has started mentioning ‘growth" as a tool in the fight against the debt crisis. But she hasn't given an inch on fiscal discipline.

"A newly elected president must present a few successes to his voters," says Schockenhoff. "One way or another, he will have to rewrite a line here and there in the fiscal pact to make it seem as if he got something out of Germany."

And that without Berlin thinking it has budged at all. "There are fundamental lines that must be followed, but in between there is some leeway if you have smart negotiations," says Stefan Seidendorf from the Franco-German Institute of Ludwigsburg.

Three of the proposals Hollande wants to submit to his European partners in order to kick start growth are acceptable to Merkel: opening more funding options for the European Investment Bank, mobilizing any leftover European structural funds not currently used, and creating a tax on financial transactions.

Hollande's fourth proposal – creating euro bonds – has been met with a very public Nein. For Germany, it is unthinkable to mutualize the debt of southern European countries. At least for now. "When Angela Merkel says she won't do something, we know she'll change her mind tomorrow or the day after," jokes Axel Schafer, a Social Democrat member of the Bundestag. Indeed, his own party, once hostile to euro bonds, has just started supporting them.

Read more from Le Temps in French

Photo - Sebastian Zwez

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Economy

In Uganda, Having A "Rolex" Is About Not Going Hungry

Experts fear the higher food prices resulting from the conflict in Ukraine could jeopardize the health of many Ugandans. Take a look at this ritzy-named simple dish.

Zziwa Fred, a street vendor who runs two fast-food businesses in central Uganda, rolls a freshly prepared chapati known as a Rolex.

Nakisanze Segawa

WAKISO — Godfrey Kizito takes a break from his busy shoe repair shop every day so he can enjoy his favorite snack, a vegetable and egg omelet rolled in a freshly prepared chapati known as a Rolex. But for the past few weeks, this daily ritual has given him neither the satisfaction nor the sustenance he is used to consuming. Kizito says this much-needed staple has shrunk in size.

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Most streets and markets in Uganda have at least one vendor firing up a hot plate ready to cook the Rolex, short for rolled eggs — which usually comes with tomatoes, cabbage and onion and is priced anywhere from 1,000 to 2,000 Ugandan shillings (28 to 57 cents). Street vendor Farouk Kiyaga says many of his customers share Kizito’s disappointment over the dwindling size of Uganda’s most popular street food, but Kiyaga is struggling with the rising cost of wheat and cooking oil.

Russia’s invasion of Ukraine has halted exports out of the two countries, which account for about 26% of wheat exports globally and about 80% of the world’s exports of sunflower oil, pushing prices to an all-time high, according to the Food and Agriculture Organization, a United Nations agency. Not only oil and wheat are affected. Prices of the most consumed foods worldwide, such as meat, grains and dairy products, hit their highest levels ever in March, making a nutritious meal even harder to buy for those who already struggle to feed themselves and their families. The U.N. organization warns the conflict could lead to as many as 13.1 million more people going hungry between 2022 and 2026.

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