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Carsten Brzeski's blog

Germany: Play it once again, Angela

Chancellor Angela Merkel last night announced that she would run for a fourth term in office at next year’s elections.

Last night, Chancellor Angela Merkel announced that she would run for a fourth term in office at next year’s elections. Merkel has been Chancellor since 2005. For a long while, Merkel had dodged the issue of whether or not she would run again. Increased criticism from within her own party in the wake of the refugee crisis and the rise of populist AfD had made her position somewhat more difficult. In the rankings of Germany’s most popular politicians, Merkel had dropped to the fourth place, after she had been the uncontested most popular politicians for several years in a row.

In fact, yesterday’s announcement did not come as a surprise. With the nomination of Foreign Minister Steinmeier as candidate-president, Merkel had elegantly moved Germany’s currently most popular politician out of next year’s election campaign. Also, not running for a fourth term would have created a deep crisis within Merkel’s own party, which did not have any plan B.

Merkel running for a fourth term should bring some relief to financial markets and international observers. In particular, after the US elections, many observers had called Angela Merkel as the possibly last leader of the free world. As the longest serving leader at the helm of a European national government, Merkel stands for continuity and stability – at least at the European and international level. At the national level, Merkel’s announcement to run again will probably meet less enthusiasm; or at least mixed feelings. While the German economy surfing on the waves of a positive business cycle, the list of unfinished works and new economic challenges has become longer. Just think of the lack of new structural reforms, subdued investments in both traditional and modern infrastructure and the impact from low growth and low interest rates on Germany’s pension system.

Angela Merkel’s announcement to run again at next year’s elections has finally started the election campaign. While at the last elections in 2013 Merkel won mainly on her personality and popularity, she will also need a good economic and political manifesto to win once again next year.