Angela Merkel’s attempts to form a government following September’s general election have sustained a potentially fatal setback. Mrs Merkel’s Christian Democrats (CDU) suffered a decline in support, but emerged as the largest party, however, their partner, the Social Democrats suffered a significant collapse in support. In consequence, the Social Democrats have vowed to take up a position in opposition and will not be drawn into a coalition. This left the Christian Democrats attempting to establish a coalition with the Green Party and the business-friendly Free Democrats Party (FDP).
Over the weekend, it became clear that coalition talks were not proceeding well. The FDP has walked out of discussions, with its leader, Christian Linder citing that there was “no common vision for modernisation of the country. We wanted a political tide change, and that was not possible at this point”.
For her part, Mrs Merkel has said that she would prefer fresh elections to leading a minority government. Should this happen, elections are likely to take place in the spring of 2018. Whilst the exit negotiations between the EU and the UK are being led on behalf of the Eu 27 by Michel Barnier rather than national leaders, political paralysis in Germany is likely to hinder progress.
The German President, Frank-Walter Steinmeier, has called on politicians to work towards finding a coalition solution. However, the Social Democrat leader, Martin Schultz has reiterated his party’s refusal to play a role in a coalition government and said that they would relish the prospect of fresh elections.
The AFD, a right-wing nationalist group, did well during the elections, narrowly failing to secure third spot and returning MPs to the Reichstag for the first time. It is politically inconceivable that they could participate in any coalition with the CDU.
Meanwhile, a group of influential business leaders in Germany has launched a lobby group aimed at getting the EU to grant the UK sufficient concession, notably on freedom of movement, that might persuade it to remain in the EU, they claim that the UK is a key EU player in the “fight” for business competitiveness. This is not the form of German business support that Leave claimed would be forthcoming after the Brexit vote, but it is likely to be welcomed by Remain supporters.