Nonetheless, Ms. Its conciliatory tone holds out the promise of a big tent that could appeal to many EU member states. Order from Chaos. A how-to guide for managing the end of the post-Cold War era. Editor's Note: In an interview with a German newspaper last weekend, followed by a speech in Berlin on Monday, Chancellor Angela Merkel laid out her unifying plan for a divided continent. Past Event America First, Europe alone? Order from Chaos The new U.
Addressing the EU’s Global Challenges Locally: the EU’s Competition and Antitrust Tightrope
Order from Chaos A how-to guide for managing the end of the post-Cold War era. Post was not sent - check your email addresses! On average, it takes days for a company to fill a vacancy, with the hardest hit sectors being the tech industry, construction and healthcare. As a new report by the economic research institute Prognos shows, the problem is only set to get worse. The report predicts a shortage of about 3 million skilled workers by , projected to rise to 3. The migration wave that began in , despite predictions to the contrary, has also failed to fill that gap, as integration into the labor force has largely failed and most candidates lack the language and technical skills required to fill the vacancies.
To a large extent, the labor shortages are a-self-inflicted wound for Germany, much like the problems in the long-suffering service sector. Over-regulation, extensive interventions and the inevitable inefficiencies of a centrally planned economy are creating significant hurdles that hold back growth and overall competitiveness.
Overly restrictive, state-imposed requirements for access to various professions dramatically shrink the pool of eligible candidates, making it even harder for employers to fill their vacancies. On top of that, exorbitantly high employer costs for social security and other taxes, as well as harsh restrictions on employee termination conditions, place a heavy burden on companies, especially those trying to compete internationally.
In other words, demographics might contribute to the present challenges, but their detrimental role is largely amplified by existing systemic inefficiencies and market restrictions. Last but not least, it is the profile of the German economy itself that is problematic and makes it likely that the county will struggle to continue to compete in the future as is has done thus far. Despite the blue-sky rhetoric and forward-leaning proposals we regularly hear from the German government and its representatives, most ideas have not crossed over from theory into practice.
The country has failed to take advantage of its booming years to improve the competitiveness of its service sector, to modernize and digitalize key aspects of its industrial sector, to press forward on tax reform or to enforce any meaningful measures to prop up its pensions that are close to breaking point. In other words, having missed the opportunity to prepare and to plan ahead while it still could, it might prove very difficult for Germany to respond to the next economic downturn lurking around the corner.
The Eurozone as a whole is already facing strong headwinds, with growth estimates dropping to new lows. It could also provide much-needed guidance for the national competition authorities of the member states, whose policies in this regard have been inconsistent Schrepel , The proposals also seek to ensure that merger review is not blinded to important geopolitical trends.
BMWi - Federal Ministry for Economic Affairs and Energy - European Economic Policy
Merger review needs to factor in the market impact of companies that are not driven by a purely commercial rationale but rather directed by third-country governments in pursuit of their industrial policies. The proposal suggests that the financial power of a state-controlled entity—for example where it benefits from subsidies or soft loans—be taken into account in assessing whether a merger significantly impedes competition.
How the theories of harm could be related to financial power are not detailed.
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This is a more sophisticated effects-focused approach to how state-supported companies may act following a merger. Of course, merger control is only relevant if mergers are notifiable. The proposals, therefore, suggest that turnover calculations should factor in the impact of state support in assessing whether notification thresholds are reached. As a result, the European Commission was able to consider the turnover of all the energy market SOEs controlled by the SASAC, as the relevant turnover to assess whether the transaction required notification under the European merger control rules.
However, if transactions involve the consolidation between state-controlled enterprises, rather than the acquisition of a third party, such a transaction may well escape scrutiny as there would, technically, not be a change of control that requires notification. Finally, the Joint Statement does not consider what other competition tools, such as unilateral conduct enforcement, could be considered in setting out rules to address any distortive effect of state-controlled entities.
Another series of suggestions in the Joint Statement concern proposals for greater input by the member states in competition policymaking as well as input in the decision-making process on specific cases as well.
However, what this notion encompasses may be understood in the context of the proposals for political input, discussed below. The input of the AdCom is currently pretty much a formality, so revitalising its role may enable better-informed decision making. This means that rather than the national authorities attending the AdCom, representatives of the national ministries of economy and industry could well take part.
Counterproductive Proposals on Euro Area Reform by French and German Economists
It is safe to say that these proposals are aimed at seeking that other Member States engage more rigorously in the competition process. The language used is not found in the competition law lexicon, leaving terms rather vague and therefore open to interpretation. The proposals also suggest setting rules on data sharing and data access, including data portability and platform interoperability, which are remedies well recognised in competition law.
Although this paragraph does not relate to merger review explicitly, remedies are easier to achieve in merger review cases see e. That is because the merger review section seeks to address the geopolitical realities of third countries creating an unlevel playing field by strategically directing economic actors and to which European competition policy must react.
The Big Tech debate is somewhat less geopolitical in nature but instead focused on how regulators should address market impact by commercial players, if distortive with a touch of technology sovereignty thrown in. This latter topic is one that every major jurisdiction and market is struggling with. It is no coincidence that the Joint Statement proposal has been made when the European Commission is developing, at the request of the March European Council ,.
This is expected for the end of The fact that the Franco-German-Polish proposals provide little specificity on what the reforms should actually entail may not be a surprise. It may be because the Member States are providing direction to the Commisson, which the Commission must elaborate on. In fact, the proposals can maybe be better understood in the context of the March commitment of the European Commission to identify how to fill existing gaps in EU law to address the distortive effects of foreign state ownership and state financing in the internal market also by the end of In addition, it is clear that more support needs to be gathered amongst other member states in order to reach agreement on the principle on the scope of competition reform.
And given that Minister le Maire also called on all Member States to join the Joint Statement contribution, we can assume that there will be a continued debate in the Council. We can also expect more concrete proposals from member states aimed at recalibrating competition policy under the new Commission. Given the confluence of circumstances we can, therefore, expect the debate on reforms to heat up. Bruegel considers itself a public good and takes no institutional standpoint.
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