The grand coalition of Chancellor Angela Merkel’s center-right CDU and the center-left SPD is showing signs of strain. This, however, is not cause for concern given the conflicting policy preferences of the governing parties — which include the CDU’s Bavarian sister party, the CSU — and the series of regional crises that Merkel has had to manage over the last two years.

The chancellor recently suffered an uncharacteristic stumble when, in response to an ongoing refugee crisis, Germany became the first EU member state to formally impose restrictions on cross-border movement, setting a precedent that threatens to undermine a cornerstone of the broader project of European integration. Nevertheless, both Merkel and the CDU-CSU remain broadly popular, and hold a double-digit lead of the SPD in polls of voter preferences.

There is nothing to suggest that either Merkel or SPD leader Sigmar Gabriel, her rather combative deputy and the minister for economic affairs, is considering an early end to their political marriage, which is expected to be sustained through the end of the current parliamentary term in 2017. However, the next elections could produce significant changes in the political landscape.

In The Spotlight

The results of state-level elections held over the past several months have revealed an increase in euroskeptic sentiment among the electorate, which is likely to build if the government fails to address public concerns over the economic and social impact of a massive influx of mostly Muslim refugees and economic migrants.

Signs of an anti-immigrant backlash spell trouble for the parties in the government, whose generous offer to provide safe haven for any refugees from the civil war in Syria is widely blamed for triggering the current crisis.

Far more troubling than the recent successes of the euroskeptic AfD is a measurable increase in violent attacks on foreigners and public disturbances perpetrated by far-right groups, and signs of a revival of popular support for the overtly anti-Muslim Pegida. A Dresden mayoral candidate endorsed by Pegida won 10 percent of the vote at an election held in June, before the refugee issue had exploded into a regional crisis.

The AfD might be reluctant to establish formal ties with Pegida, but such an alliance could become the basis for a viable far-right party, and it is possible that the AfD could pursue cooperation with Pegida if it fails to make significant further electoral gains on its own.


The PRS Group
About The Author The PRS Group
The PRS Group is a leading global provider of political and country risk analysis and forecasts, covering 140 countries. Based on proprietary, quantitative risk models, the firm's clientele includes financial institutions, multilateral agencies, and trans-national firms.

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