As German Chancellor-elect Angela Merkel announces a Grand Coalition agreement, Patricia Hogwood discusses the background and implications with Channel 4 news.

Following the German federal election of 22 September 2013, Germany’s incumbent Christian Democratic Chancellor and election victor Angela Merkel (CDU/CSU) was just short of the majority support needed to form a majority government. In coalition negotiations, Germany’s main opposition party, the Social Democratic Party (SPD), used its leverage to secure the central plank of its electoral campaign: Germany’s first national minimum wage. However, it lost out over its plan to introduce a wealth-tax on high-earners. It will now have to pursue tax savings through closing avoidance loopholes at home and lobbying for tighter financial and fiscal regulation within the EU – including the outlawing of tax havens. This will not be popular with the UK, but the SPD may still want to take ownership of this issue at EU level if only to leave perceived responsibility for the Eurozone crisis and an anticipated third Greek bailout with the CDU/CSU.

For Patricia’s commentary on the German elections and government formation, see:

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