Saturday 25 November 2017

When a Pillar of European Stability Crumbles

Highlights


  • Negotiations to form a German government collapsed Nov. 19, opening a period of political uncertainty as leaders try to form a minority government or even seek new general elections.
  • Prolonged political uncertainty in Germany will complicate France's plans for eurozone reforms and delay discussions about financial and institutional reforms for months.
  • The situation in Germany could also delay negotiations about the United Kingdom’s future ties with the European Union.


Germany's role as the beacon of political stability and predictability in Europe is now in doubt. Negotiations to form a government collapsed Nov. 19 after the pro-business Free Democratic Party (FDP) left coalition talks, opening a period of prolonged political uncertainty. For weeks, the FDP, German Chancellor Angela Merkel's conservative Christian Democratic Union (CDU), its Bavarian sister party the Christian Social Union (CSU) and the environmentalist Green party have negotiated over controversial issues such as migration, the environment, and taxes to avoid this scenario. Now, German parties and German President Frank-Walter Steinmeier must decide what to do next. The rest of Europe will be watching as well, waiting for a new government to be appointed in Berlin before it can resume talks about the future of the European Union.

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