ABSTRACT
The chapter examines German policy in the context of the European Union and argues that, within it, Germany primarily uses markets to achieve its strategic objectives. While the range of options open to states that seek to limit the role of the state in the economy is comparatively limited, the analysis shows how they can nevertheless seek to use markets to coerce other states. The chapter first elaborates on liberal geo-economics as a foreign policy strategy and discusses the differences between geo-economic approaches by Western democracies on the one hand and authoritarian states on the other. It then analyses how Germany has applied liberal geo-economics beyond the European Union and within it. In particular, the analysis concentrates on Germany’s recent confrontation with Russia and the Eurozone crisis. It puts Germany’s liberal geo-economics in the context of the history of neoliberalism and argues that Germany has used economic means to impose its preferences within the Eurozone in an analogous way to US policy in developing countries in the 1980s. As such, Germany appears as a paradigmatic case of what can be called liberal geo-economics.
