What Germany coalition deal means for EU – FDP leader could be trouble for bloc

Brexit will have 'consequences' for the UK says Olaf Scholz

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The September federal election gave the SPD, led by Olaf Scholz, a small win over other parties, with a coalition between three parties likely to make up the next German Government. But the 16-year tenure of Angela Merkel comes to a close, the new Government will likely form a different type of relationship with its neighbours – which could prove to be a problem for the EU.

The top deputies from the parties have been in exploratory talks in recent weeks for a potential “traffic light” coalition — with the centre-left Social Democrats (SPD), the liberal Free Democrats (FDP) and the Green Party.

The three parties have outlined in broad terms their plan for what they called a “coalition of progress.”

Their focus is on modernisation in various forms — from addressing climate change, as well as adjusting Germany to the digital age, and raising the minimum wage.

In a joint statement, the three parties said: “We’re convinced we can put together an ambitious and viable coalition agreement.”

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Mr Scholz, appearing together with leaders of the Greens and FDP, said the announcement is a “very good result” after days of exploratory discussions.

He said: “We have worked intensively this week … and talked a lot with each other to prepare everything for today’s consultation.”

“[It] makes clear that a government can be built in Germany that can ensure we make progress, progress that is possible and necessary.”

Formal coalition talks will begin as soon as next week, making a new German Government before Christmas much more likely.

On election day last month, the SPD came in first with 25.7 percent, narrowly beating Angela Merkel’s CDU/CSU, which sustained heavy losses and accrued just 24.1 percent of the vote share.

What does this mean for the EU?

Germany has been a longstanding central tenet of the EU – with Angela Merkel being a spearhead for much of the bloc’s agendas.

The next German chancellor, if the above arrangements prove successful, outgoing Social Democrat finance minister Olaf Scholz, is a popular figure with governments in Paris and Rome after parting with Germany’s more frugal stance throughout the coronavirus pandemic.

But it is his most likely replacement as finance minister, Christian Lindner, leader of the FDP, who could cause trouble for the bloc.

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Mr Lindner has headbutted with his European neighbours on numerous occasions.

In 2017, Mr Lindner slammed French President Emmanuel Macron’s economic plans as turning the EU into a “Soviet Union-style system.

In the same year, he called for Greece to temporarily kicked out of the Eurozone during its financial turmoil.

In 2015, the Budenstang member was involved in a small diplomatic incident at a dinner in Berlin.

According to a guest at the dinner, Mr Lindner told another diner: “We cannot use the savings accounts of German workers to save the savings of the Italians.”

It drew a negative response from Italy’s ambassador to Berlin, who reportedly said: “If I remember rightly it was the Italians who repaid German debts.”

Mr Lindner has been in coalition talks before – but things didn’t go exactly to plan, with the German politician holding strong to his principles.

In the federal election of 2017, following Mr Lindner bringing back the FDP back from disaster, he more than doubled the party’s previous result.

It seemed that the rejuvenated party would play a decisive role as part of a new coalition government including Merkel’s centre-right CDU party and the Greens – but Lindner walked away last minute as the coalition would not put through enough of his party’s policies.

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