Good morning from Berlin, Brussels,

The rise of the far right appears to be affecting the agenda of mainstream pro-EU parties in the eurozone's largest economy.

In Germany, the Social Democrat-led government has decided to introduce checks at all borders. 

It appears that the migration agenda is being driven by the rise of the far right - as it has been the case in the recent regional elections in Thuringia and Saxony - rather than a state of emergency comparable to the one in Southern Europe.

Politically, Germany's far-right AfD is pushing the centre-right main opposition Christian Democrats (CDU) to the right and, in a spillover effect, the ruling SPD to the right as well. 

Germany's move to refuse entry to migrants could have a domino effect, as Austria - which holds elections on 29 September and where the far-right FPÖ is leading the polls - has already refused to take in any migrants. 

Essentially, it means that these migrants will be pushed back to Italy.

Paradoxically, in June 2023, the Social Democratic Chancellor Olaf Scholz identified the lack of skilled workers as the main obstacle to restoring economic growth, which should be addressed by increasing immigration.

Another election is coming up on 22 September in the East German state of Brandenburg, where the far-right AfD is also leading the polls

In neighbouring France, Europe is expecting new Prime Minister Michel Barnier's next steps, as the far right has already warned him that he is being "watched."

Meanwhile, Viktor Orbán's Hungary, the mastermind behind the EU's new far-right push, was condemned by Belgium after threatening to bus migrants to Brussels.

Mario Draghi’s call for EU policymakers to reduce companies’ regulatory burden to boost the bloc's faltering competitiveness was praised by European business groups but elicited stinging criticism from Europe’s largest trade union confederation.

Thomas Moller-Nielsen has the story.

Meanwhile, the report was met with both praise and reservations by MEPs in the European Parliament.

The former European Central Bank president’s hotly anticipated report on the future of EU competitiveness repeatedly emphasised the “regulatory burden” borne by European firms.

In his 328-page document, Draghi described in painstaking detail the "existential challenge" posed by Europe's weak growth rate, tackling issues of lagging productivity, high energy prices, lack of investment, insufficiently integrated capital markets and a shortage of skilled workers.

He also called for a fundamental re-think of the EU’s green growth drive, advocating for “less green” and “more growth” while standing by the bloc’s climate goals.

The report also gives special attention to the tech sector, highlighting the need for a more innovative technology industry to compete with foreign giants.

On the Defence front, Draghi urged member states to stick to ambitious defence industry reforms, as explained by Aurélie Pugnet.

However, the (deeply) politically divisive issue of how to finance the “massive investments” of up to €800 billion, Draghi was exceedingly cautious, Thomas Moller-Nielsen explains in his Brief.

EU INSTITUTIONS

Committee of Regions chief says EU needs new, stronger cohesion policy. Cohesion policy is essential for the competitiveness of the European Union and must not be seen as a “charity policy”, the president of the European Committee of the Regions, Portugal’s Vasco Cordeiro, warned on Monday. Read more.

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BERLIN

Germany introduces checks at all borders, moves to refuse entry to migrants. Following increased political pressure, German Interior Minister Nancy Faeser announced on Monday that she will introduce checks at all border crossings and develop a model to refuse entry to irregular migrants. Read more.

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PARIS

French far-right leader Bardella allegedly faked documents to avoid EU funds embezzlement charges. French Rassemblement National (RN) leader Jordan Bardella allegedly drafted falsified documents to prove he was working as a part-time MEP assistant while he was actually working for the party, an investigation by French daily Libération found. Read more.

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BRUSSELS

Belgium condemns Hungarian threat to bus migrants to Brussels. Belgium’s migration chief Nicole de Moor responded to the Hungarian government’s threat to send busloads of illegal immigrants to Brussels, saying it “undermines solidarity and cooperation within the [European] Union,” on Monday. Read more.

ROME

Political reactions following the publication of the Draghi report have been mixed in Italy, with Democratic Party MEP Giorgio Gori (S&D) suggesting that these reactions only serve to highlight the real “enemies of Europe”. Read more.

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MADRID

Spain did Maduro a ‘favour’ by granting asylum to opposition leader, centre-right PP argues. Venezuelan President Nicolás Maduro must be “celebrating” Spain’s decision to grant asylum to Edmundo González Urrutia – the opposition’s widely recognised winner of the July 28 elections – the leader of Spain’s People’s Party (Partido Popular/EPP), Alberto Núñez Feijóo said on Monday. Read more.

Sánchez pledges ‘constructive efforts’ to help bridge China-EU differences. Spanish Prime Minister Pedro Sánchez contacted Chinese President Xi Jinping on Monday, pledging Spain’s “constructive efforts” to foster a richer and more balanced relationship between China and the European Union amid ongoing tariff disputes. Read more.

WARSAW | BERLIN

Polish Prime Minister Donald Tusk called off his visit to Germany, planned for later this week, as relations between the two countries worsen. Read more.

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WARSAW

Polish authorities take down Belarusian and Russian cyber-espionage group. Polish authorities successfully dismantled a cyber-espionage group linked to Belarusian and Russian intelligence services, which had been conducting malicious activities in Poland, reported Polish Minister of Digitization Krzysztof Gawkowski on  Monday. Read more.

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BRATISLAVA

EU mulls freezing Slovakia’s funds for rule of law violations. The EU is developing a proposal to sanction Slovakia for its deteriorating democratic standards, which could lead to the suspension of EU funds allocated to Bratislava, according to a report from Bloomberg and Czech News Agency (ČTK). Read more.

SOFIA

Bulgaria mulls nationalising TIR parking lots to tackle border transport chaos. The Bulgarian government is considering the possibility of taking control of currently privately owned parking areas where heavy lorries have to park and pay a fee before crossing the border. Read more.

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LJUBLJANA

Slovenia proposes Marta Kos for the European Commission. Marta Kos, a Slovenian liberal politician and former diplomat, is the country’s new nominee for European commissioner, its government announced on Monday. Read more.

• EU: Commission President Ursula von der Leyen, Parliament President Roberta Metsola meet with Prime Minister of Finland Petteri Orpo;
• Commission Vice President Vĕra Jourová speaks at high level debate on “AI and democracy: the new frontier of the EU”; Meets with Director General of Reporters Without Borders Thibaut Bruttin;
• Health Commissioner Stella Kyriakides hosts Special Envoy on Antimicrobial Resistance for the United Kingdom Dame Sally Davies;

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[Edited by Sarantis Michalopoulos, Daniel Eck, Martina Monti, Alice Taylor]