Angela Merkel Begins Fourth Term as German Chancellor

Ms. Merkel’s new government will need to forge a position on how to respond to threats of punitive tariffs from the U.S.
Photo:

Gregor Fischer/Zuma Press

BERLIN—

Angela Merkel

on Wednesday finally began her fourth, and likely final, term as German chancellor.

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The lawmakers’ vote bookends the country’s longest and most complicated coalition-building exercise in post-War history, nearly six months after a general election that delivered a fractured parliament and no obvious ruling majority.

The decision, with 364 ballots out of 692 votes cast, gives Ms. Merkel’s government, to be sworn in later Wednesday, a comfortable majority in the Bundestag, parliament’s lower house, which she will need to tackle an accumulating list of international and domestic challenges.

It also ends a period of political hibernation for Europe’s largest economy and the longest-serving of the continent’s current leaders. Since Ms. Merkel and her contenders launched her electoral campaign last summer, Germany has had a “do not disturb” sign on its door.

Close allies such as French President

Emmanuel Macron

and British Prime Minister

Theresa May

have had to wait as Ms. Merkel’s first attempt to form a coalition collapsed last October, forcing her into last-ditch talks with her former ruling partners and ideological rivals in the center-left Social Democratic Party.

Now in office, Ms. Merkel and her newly appointed Social Democratic finance minister,

Olaf Scholz,

will travel to Paris later this week to start talks on Mr. Macron’s ambitious proposals for reforming the eurozone and the European Union.

The proposals—including a bigger budget for the EU and more sharing of financial liabilities among members of the eurozone—are controversial in Germany. A vague Europe chapter in the German government’s coalition agreement did little to paper over differences between the two ruling partners.

Ms. Merkel’s Christian Democratic Union is wary of any move to pool more resources among EU member states or reinforce existing financial backstops in the eurozone. Mr. Scholz’s SPD has sounded more open but the party’s voters are also suspicious about further integration in Europe.

Ms. Merkel’s new government will also need to forge a position on the terms of the U.K.’s planned exit from the EU and on how to respond to threats of punitive tariffs from the U.S. on imports of European steel, aluminum and, possibly, German cars.

All the while, the chancellor will face a number of domestic challenges, including keeping the peace in her coalition between a CDU that is growing increasingly hostile to immigration and an SPD that has been gravitating toward more left-wing positions since the electoral campaign.

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Adding to the tension, possible successors to Ms. Merkel, who has told confidantes she would not run for a fifth term, will be jostling for dominance in her party. Leading the pack are

Jens Spahn,

designated health minister and figurehead of the party’s right wing, and

Annegret Kramp-Karrenbauer,

the new secretary-general, Ms. Merkel’s preferred choice and champion of the chancellor’s centrist line. Others could yet emerge.

Ms. Merkel’s new term will also take place under the hostile scrutiny of a strengthened right-wing opposition. From a gathering of aging economics professor opposed to Berlin’s handling of the eurozone crisis, the Alternative for Germany, or AfD, has turned into a strident antiestablishment voice and the largest opposition party in the Bundestag.

Write to Andrea Thomas at andrea.thomas@wsj.com and Bertrand Benoit at bertrand.benoit@wsj.com

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