Domestic Deadlock

Political Gridlock in Berlin

Kanzleramt Source Imago
Endless meetings, little action, at the chancellery in Berlin.
  • Why it matters

    Why it matters

    • The business sector was hoping for quicker action on amending Germany’s minimum wage law.
  • Facts


    • Top players in the coalition meeting included Chancellor Angela Merkel (CDU), Sigmar Gabriel (SPD) and Horst Seehofer (CSU).
    • No breakthrough on building power lines from northern Germany to Bavaria as part of the nation’s energy transition.
    • More meetings of coalition leaders are planned for April and June.
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This was supposed to be the year of business-friendly politics from Germany’s right-left coalition government led by Chancellor Angela Merkel’s Christian Democrats and their Social Democratic partners.

For businesses, it has seemed high time for the shift, after Ms. Merkel had endorsed several labor-backed reforms — including introducing the country’s first minimum wage and allowing early retirements at just 63.

But after a meeting of the coalition this week, it seems German business will have to keep waiting for a sympathetic ear from Ms. Merkel.

Party leaders appeared to make no progress on Tuesday to tweak the new minimum wage law, which employers say has created a bureaucratic monster. Negotiators also could not overcome Bavarian opposition to the high-power lines that are needed to transport the nation’s wind and solar electricity.

Party negotiators did manage to settle a dispute over limiting rent increases, promising to introduce rent controls in cities where the cost of living has risen sharply, but they postponed most everything else on their agenda.

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