Coalition agreement is nodded by SPD members

The German Social Democratic Party (SPD) has announced the approval of a new coalition agreement, marking the beginning of a fresh federal government with ambitious plans for economic growth, climate action, social fairness, and strengthened international partnerships.

Starting from April 15, more than 358,000 SPD members will have the opportunity to vote on the agreement. In a significant move, the party leader, Lars Klingbeil, is set to become deputy chancellor. The coalition agreement was approved with 84.6% yes votes, while 15.4% voted "no."

The title of the coalition agreement is "Responsibility for Germany," reflecting the government's commitment to addressing the country's pressing issues. However, the implementation of the agreement has sparked ongoing debates and challenges.

One of the key areas of contention is energy and climate policy. The government aims for climate neutrality by 2045, with flexibility on timing targets such as 2040. However, the Council of Experts on Climate Change warns that current plans risk missing emission reduction goals unless an adequate Climate Action Programme is adopted soon. There is also concern over social impacts if EU carbon pricing in transport and heating takes effect without cushioning for citizens.

Fiscal policy and investment are another area of focus. The coalition has initiated a large-scale investment fund totaling €500 billion over 12 years, with €300 billion earmarked for national infrastructure, €100 billion for climate and transformation initiatives, and €100 billion for state-level projects. The government has also relaxed the constitutional debt brake for defense spending, allowing borrowing above 1% of GDP for this purpose. States have gained more fiscal autonomy to run deficits for regional investments.

Budget drafts for 2025 and 2026 have been quickly adopted, focusing on growth, fairness, and social support measures such as commuter allowance increases and energy price relief, combined with a commitment to strict budget consolidation and combating tax fraud.

In foreign and security policy, Chancellor Friedrich Merz has emphasized Germany’s role as a strong global partner, boosting EU unity, supporting Ukraine against Russian aggression, and providing humanitarian aid during the Gaza conflict. NATO defense spending commitments are being pursued, including raising expenditure to 5% of GDP.

Despite the coalition’s resolute start, lingering uncertainties remain about the energy transition and climate policies. Industry welcomes flexibility, but expert bodies urge careful balancing to meet climate targets without social disruption. The complex allocation of the large investment fund and relaxation of fiscal rules have raised debates over long-term fiscal sustainability versus urgent investment needs.

In the southwest, the SPD has faced controversy, particularly in Baden-Württemberg over the role of Saskia Esken. The SPD in Baden-Württemberg did not renominate Esken for the federal board. The southwest is strongly represented in the new federal government by key roles of the CDU politicians Thorsten Frei and Nina Warken.

The SPD has not made any announcements on their Instagram, TikTok, or other social media accounts regarding the new coalition agreement, but the approval was announced on their Instagram and TikTok accounts with the words "Habemus Votum. Habemus Coalition."

As the new government embarks on its journey, it faces a complex landscape of challenges, from ensuring effective climate measures to maintaining fiscal discipline amid large spending programs and managing social cohesion during energy and climate transitions. The next steps will be crucial in shaping the future of Germany and its role in the global arena.

[1] Source for energy and climate policy: [Link to the source] [2] Source for fiscal policy and investment: [Link to the source] [3] Source for budget and structural reforms: [Link to the source] [4] Source for foreign and security policy: [Link to the source] [5] Source for implementation and controversies: [Link to the source]