Germany used to be the locomotive of Europe - but is now slowing economically. Many believe the Chancellor and her coalition are responsible for the downturn.

James Hawes describes the Federal Republic of Germany in 2013 and 2014 as an ideal democracy in his work The Shortest History of Germany. The German Chancellor Angela Merkel was at the height of her power at the time. 

The German economy technically pulled the rest of Europe upwards and Germany was heading for the black zero, a term used by Finance Minister Wolfgang Schauble meaning to have zero debt.

Once the locomotive of Europe, the country is now in upheaval. Merkel, the chancellor since 2005, is still in power but has announced an end to her leadership. The grand coalition of Christian Democrats (CDU) and Social Democrats (SPD) still governs, but without electoral support.

Both parties experienced heavy loses in recent federal elections and at the European Parliament election. Further, the country is closely watching both the chancellor's health and whether the new CDU leader and recently-appointed Defence Minister Annegret Kramp-Karrenbauer - known as AKK - is competent enough for a transition period after four legislative periods.

There are still a good 800 days until the next regular Bundestag (national) election. So it is astonishing that there are murmurs within the coalition government about calling a second vote.

An early end for Merkel?

There are two important reasons for ending the political transition earlier than in the summer of 2021.

The first is that because the grand coalition is divided on many issues, such as foreign policy, and Germany is losing influence on the international stage, according to experts.

The second is that the country's economic strength is dwindling.

The International Monetary Fund has downgraded the economic forecast for Germany for the fourth time within a year; together with Italy, Europe's largest economy is suddenly lagging behind the EU average. Key companies such as car manufacturers are issuing profit warnings. The business climate is falling, orders are falling. The country’s National Bank  warns of job losses. Germany is no longer the locomotive that pulls other countries along, but is slowing growth in the EU.

The coalition of the CDU and SDP downplays economic issues and is placing the blame on the trade war between the US and China, blaming US President Donald Trump’s policies. However, it is an open question about when the end to that dispute will come.

The Social Democrats have pleaded for tax increases to finance economic assistance and reforms. “Germany needs to keep up in digitisation, artificial intelligence and eco-friendly production”, the SDP says. 

Merkel and her party have been criticised for acting too slowly and not preparing enough to ensure her succession goes smoothly. The transition process away from Merkel towards something new is taking too long, according to detractors. 

“But the world is not waiting for Germany,” Cerstin Gammelin, an analyst for the German newspaper Sueddeutsche Zeitung, wrote. “The impending economic downturn is a clear signal to hurry with the change.”

Source: TRT World