‘Deed of Surrender’ — German Establishment Parties Agree on Coalition Deal to Form Government

Coalition negotiations to form the next government of Germany concluded on Wednesday, paving the way for another establishment government in Berlin as Chancellor Friedrich Merz capitulated to the election-losing leftist party on key issues including immigration, energy, and the economy.

After over six weeks of negotiations following the February federal elections, Germany will finally have a new government, Die Welt reported.

Appearing in Berlin on Wednesday afternoon, Christian Democratic Union (CDU) leader Friedrich Merz, his Union partner and head of the Christian Social Union in Bavaria (CSU), Markus Söder, joined Social Democratic Party (SPD) leaders Lars Klingbeil and Saskia Esken to unveil a 140 page agreement for the new government.

The ‘Black-Red’ coalition, named after the respective parties’ colours —black for the nominally centre-right neo-liberal CDU and red for the socialist SPD—was forged after Merz ruled out a partnership with the right-wing populist Alternative for Germany (AfD) party.

This came despite the AfD coming in a strong second place in the elections and the governing Social Democrats suffering a resounding rejection at the ballot box after four years of failed governance under outgoing Chancellor Olaf Scholz.

Having immediately ruled out partnering with the AfD, Merz effectively ceded any negotiating leverage in the talks with the SPD, thereby forcing him to give into demands from the left that he would have otherwise not had to should he have chosen to work with the AfD.

It also means that his government will be beholden to the whim of the Social Democrats for the rest of its tenure, given that the junior coalition partner will have the power to collapse the government at any point by withdrawing their hand of MPs.

While Merz campaigned as a hardliner on immigration in an attempt to fend off the surging anti-mass migration AfD and to shed his party’s open borders reputation from when it was led by Angela Merkel, who unilaterally ushered in the European Migrant Crisis in 2015 by opening the doors to unfettered waves of supposed refugees from Syria and elsewhere, he immediately began to give ground to the left after winning the election.

Merz had made much of plans to effectively shut down the borders of Germany to illegal migration during the campaign. Yet, in the agreement with the SPD, the government has committed to only increasing border pushbacks of illegals “in coordination with our European neighbours,” which neighbouring countries like Austria have already rejected, throwing the plan into doubt.

Emphasising the continued commitment to open borders, SPD leader Lars Klingbeil said on Wednesday that “the fundamental right to asylum remains untouchable,” indicating that illegals who come to the border and apply for asylum will likely still be let into the country.

Additionally, key liberalising reforms to the immigration system implemented under the previous SPD-led ‘traffic light’ government, such as reducing the time spent in the country before becoming eligible for citizenship from eight to five years and allowing non-EU migrants to hold dual nationality, will remain in place.

Merz has claimed some supposed wins on the immigration front, including lifting deportation restrictions to Syria and Afghanistan. However, despite claiming this as a success, the previous left-wing government had already committed to doing so following a spate of terror attacks committed by migrants from the two countries over the past year.

The government will also stop family reunification (chain migration) for migrants entitled to subsidiary protection for the next two years. Yet this falls short of halting chain migration for asylees in general, who represent a far larger cohort of foreigners in the country.

The coalition agreement saw some wins for the centre-right Merz on the economic front, with the incoming government committing to eventually lowering taxes on people with low and medium incomes. There was also an agreement to slash the electricity tax to the European minimum, likely providing some relief to Germany’s struggling manufacturing industry.

However, the so-called “solidarity surcharge,” an additional levy on top of income, capital gains, and corporate taxes paid by high earners and many businesses introduced following reunification in 1991, will remain in place despite Merz’s party previously calling for it to be abolished.

Perhaps Merz’s most impactful concession on Germany’s economic future was on nuclear power. Under his predecessor, Angela Merkel, the CDU-led government began denuclearising the country in favour of so-called green alternatives. The outgoing government completed this process in 2023, in large part at the behest of the coalition partner Greens.

While Merz was heavily critical of this, particularly in light of the energy crisis in Europe sparked by the Ukraine war, and his party’s election manifesto called for a reversal of the move, the coalition agreement said that the new government will not consider a return of nuclear power in the country.

AfD co-leader Alice Weidel branded the Black-Red coalition as a “deed of surrender” from Merz and the CDU, saying: “The paper bears the signature of the election loser SPD throughout, peppered with bows and kowtow to the Greens.”

“The Union did not keep a single election promise, and Merz failed across the board even before his election as chancellor,” she said.

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