Amidst Trump's turmoil, Germany prepares for a new administration under Merz's leadership
BERLIN – Germany's new conservative leader Friedrich Merz is all set to take the helm as chancellor on Tuesday, with a mission to rejuvenate the lagging economy and boost the diplomatic standing of Europe's most populous nation. As the United States, under President Donald Trump, has thrown long-standing security and trade ties into chaos and cozied up to Russia to put an end to the Ukraine war, Merz has pledged to fortify Berlin's role in Europe during these troubling times.
"Germany is back on its feet," the 69-year-old declared with conviction in a message to Trump a few weeks ago, following his CDU/CSU alliance's agreement to govern Germany alongside the center-left Social Democrats (SPD) of outgoing Chancellor Olaf Scholz. But Merz has a mammoth task ahead, starting from day one, including the rapid rise of the far-right and anti-immigration Alternative for Germany (AfD) party, which clinched second place in February's election and enjoys robust support from Washington.
At 9am (0700 GMT), Merz will seek a majority in the 630-seat Bundestag to become modern Germany's 10th chancellor. Upon confirmation by President Frank-Walter Steinmeier, he will take the oath of office at noon.
The new government has already secured hundreds of billions of euros in fiscal support under a spending "bazooka" passed by the outgoing parliament, aimed at rebuilding crumbling infrastructure, the long-neglected military, and boosting an economy that has contracted for two years.
Germany intends to continue supporting Ukraine as the United States encourages a peace deal to end the war initiated by Russia's invasion over three years ago. Trump has put pressure on European allies, accusing them of inadequate defense spending and taking advantage of the United States through exchange surpluses, threatening tariffs particularly harmful to export-dependent Germany, such as automobiles.
"A Marathon on a Tightrope"
Merz has promised to clamp down on unauthorized immigration and strengthen border security, putting an end to the welcoming open-door policy enacted by his Party rival, Angela Merkel. He has warned that unless such drastic measures are taken, the AfD may emerge victorious in elections four years from now.
The stakes have become even higher following the German domestic intelligence service's designation of the AfD as "right-wing extremists" late last week. This revived a debate on whether the government should consider banning the more than ten-year-old party. This move sparked a fierce response from Trump’s allies, who support the AfD, with US Secretary of State Marco Rubio accusing the German spy agency of "tyranny in disguise."
"In this moment of geopolitical crisis, chancellor Merz will have to run a marathon on a tightrope," said political analyst and author Michael Broening, who serves on the SPD's Basic Values Commission. "The stakes are high. One misstep could result in collapse — and Germany's far right is poised to capitalize on even the slightest wobble."
Merz, who boasts a robust business background but has no experience leading government, said on Monday, "we live in times of profound change, of profound upheaval ... and of great uncertainty." He added, "And that is why we know that it is our historic obligation to lead this coalition to success."
The chancellor-in-waiting also promised a government that's heard globally. His first trip will take him to Paris on Wednesday, followed by a visit to Warsaw.
"The end of the power vacuum at the heart of Europe is a significant positive on its own," wrote analyst Holger Schmieding of Berenberg Bank. "Although we don't expect a policy revolution, Merz will likely make a difference. With his strong transatlantic, pro-European, and pro-Ukrainian convictions, we expect him to pursue a more assertive foreign policy, improve relations especially with France and Poland, and have a better chance of getting along with U.S. President Donald Trump."
The coalition has emphasized tax relief for small and medium incomes, energy cost reductions, and business deregulation to kickstart economic growth. The VAT rate for the catering sector will return to 7% from 2026, and tax incentives will be introduced for longer working hours to address labor shortages. The climate policy aims for a carbon-neutral Germany by 2045 under the Paris Agreement framework.
Immigration and domestic security policies include enacting a "new consistent approach," involving suspension of voluntary admission programs, limiting family reunification, and enabling border rejections for asylum seekers in coordination with EU partners. Police will gain expanded powers, including AI-driven public data analysis for particular crimes, and new laws will streamline detention pending deportation. The partial cannabis legalization under the previous government may face a review in autumn 2024.
Germany intends to safeguard freedom and peace through enhanced military readiness, suggesting continuity in security commitments to Eastern Europe. EU-level coordination on migration enforcement is prioritized. While specifics on EU-U.S.-Ukraine dynamics aren't detailed in the agreement, Merz's emphasis on European cooperation and strengthened defense capabilities indicates alignment with NATO's Ukraine support framework.
- Michael Broening, a political analyst and author, stated that chancellor-elect Friedrich Merz will have to navigate a "marathon on a tightrope" given the current geopolitical crisis.
- Holger Schmieding of Berenberg Bank wrote that the end of the power vacuum at the heart of Europe is a significant positive, but not a policy revolution, and Merz will likely make a difference.
- The coalition, which includes Merz's CDU/CSU alliance and the center-left Social Democrats, has emphasized tax relief, energy cost reductions, and business deregulation to stimulate economic growth.
- Merz has pledged to clamp down on unauthorized immigration and strengthen border security, taking a tougher stance on immigration compared to his Party rival, Angela Merkel.
- The new government's climate policy aims for a carbon-neutral Germany by 2045 under the Paris Agreement framework, while immigration and domestic security policies include stricter enforcement of asylum seekers and expanded police powers.
