Country Risk

Post-election political shake-up makes German government formation challenging; unlikely to significantly change foreign policy or investment environment

25 September 2017

Key Points

  • Following the Social Democrats' announcement that they would end the grand coalition and go into opposition, Angela Merkel is left with only one viable option to build a government, an alliance between her centre-right Christian Democratic Union (Christlich Demokratische Union Deutschlands: CDU)/Christian Social Union (Christlich-Soziale Union: CSU), the liberal Free Democratic Party (Freie Demokratische Partei: FDP), and the Green Party, leaving the two smaller parties with significant leverage over the CDU/CSU.
  • Such a tripartite coalition would be exposed to internal divisions and a likely strong and active parliamentary opposition from the centre-left, the left, and the far right, probably increasing government instability in the new administrative term.

(109 of 1038 words)

Industry Links

IHS Jane's is not responsible for the content within or linking from Industry Links pages.