Thursday

1st Dec 2022

German parties agree 'Grand Coalition'

  • Bundestag: A deal has been reached, but needs approval (Photo: BriYYZ)

German Chancellor Angela Merkel in the early hours of Wednesday (27 November) reached a deal for a "Grand Coalition'" with the Social Democrats (SPD), after over two months of negotiations.

But the centre-left party still needs the approval of its 475,000 members, with the vote result expected on 14 December.

Read and decide

Join EUobserver today

Become an expert on Europe

Get instant access to all articles — and 20 years of archives. 14-day free trial.

... or subscribe as a group

Merkel and the leaders of the SPD and her Bavarian sister-party, CSU, will present the coalition deal later on Wednesday. The parties have divided the ministries among themselves, but the names of the new ministers will not be made public until after the SPD vote, prompting criticism from opposition parties.

SPD general secretary Andrea Nahles on her way out of the 17-hour long talks seemed confident the party members will endorse the deal.

"I am pretty sure with this result we will be closer to a Yes than a No," she said.

But some prominent Social Democrats, like the writer Gunter Grass are openly against another Grand Coalition, pointing to the fact that the parliamentary opposition will be too small for a proper democratic checks and balances system.

Others fear that the SPD will further erode its support base - as it did in the last Grand Coalition with Merkel between 2005 and 2009 - because it will fail to really steer policies more to the left.

But polls indicate that snap elections would be an even worse option for the SPD. They are currently polling at 23 percent, three points down compared to their 22 September elections result.

As for the coalition deal, the SPD got its way on the introduction of a minimum wage of €8.5 an hour. But it will only be introduced from 2015 and some jobs - like seasonal workers in agriculture or newspaper vendors - will continue to have lower wages.

European Parliament chief Martin Schulz, a member of the SPD negotiation team, gave somewhat good news to troubled eurozone countries.

A 2012 deal on allowing troubled banks to be directly recapitalised from the eurozone's bailout fund (ESM) - which seemed to be off Merkel's table in recent months - seems to be partially back.

"We have agreed in principle, that the cascade of liabilities when a bank is being wound down has to be stopped," Schulz said, in reference to the vicious circle between troubled banks and state coffers.

In order to break this circle, first there will be a "bail-in process" hitting the bank's creditors, then a state guarantee for the banks.

"Finally, if the bail-in process and the state guarantee are not working, then there can be direct recapitalisation from the ESM," Schulz said.

Germany unveils new Merkel government

Merkel will start her third term this week, with Schaeuble to stay on as finance minister and Social Democrat Steinmeier to return to the foreign minister post.

Swedish EU presidency: 'Ukraine, Ukraine, Ukraine'

Ukraine and a looming economic recession is set to dominate the upcoming Swedish EU presidency, which takes over at the start of next year. Sweden's ambassador to the EU, Lars Danielsson, laid out some of its priorities.

French official accused of conflict over EU fish lobby job

A senior French official is being accused of conflicts of interest for spearheading a leading role in Europeche, a fishing-industry lobby group based in Brussels. The hire comes as the EU Commission threatens a lawsuit against France over fishing.

Portugal was poised to scrap 'Golden Visas' - why didn't it?

Over the last 10 years, Portugal has given 1,470 golden visas to people originating from countries whose tax-transparency practices the EU finds problematic. But unlike common practice in other EU states with similar programmes, Portugal has not implemented "due diligence".

Catalan spyware victims demand justice

Victims of the widening spyware scandal in Spain are demanding justice and reparations, following the revelations that journalists, lawyers, civil society and politicians had been targeted.

Stakeholders' Highlights

  1. Nordic Council of MinistersCOP27: Food systems transformation for climate action
  2. Nordic Council of MinistersThe Nordic Region and the African Union urge the COP27 to talk about gender equality
  3. International Sustainable Finance CentreJoin CEE Sustainable Finance Summit, 15 – 19 May 2023, high-level event for finance & business
  4. Friedrich Naumann Foundation European DialogueGender x Geopolitics: Shaping an Inclusive Foreign Security Policy for Europe
  5. Obama FoundationThe Obama Foundation Opens Applications for its Leaders Program in Europe
  6. EFBWW – EFBH – FETBBA lot more needs to be done to better protect construction workers from asbestos

Latest News

  1. Belarus dictator's family loves EU luxuries, flight data shows
  2. How Berlin and Paris sold-out the EU corporate due diligence law
  3. Turkey's EU-funded detention centres ripe with abuse: NGO
  4. In green subsidy race, EU should not imitate US
  5. EU Commission proposes suspending billions to Hungary
  6. EU: Russian assets to be returned in case of peace treaty
  7. Frontex leadership candidates grilled by MEPs
  8. Portugal was poised to scrap 'Golden Visas' - why didn't it?

Join EUobserver

Support quality EU news

Join us