After nearly 16 years of stable and pragmatic leadership by Angela Merkel, Germany finds itself at a crossroads. The period, often referred to as the “Merkel legacy”, is characterised by economic growth, political stability, and Germany’s position as the leader of the European Union.
However, several years after her departure, the country is facing numerous challenges: an economic slowdown, an industrial crisis, and geopolitical uncertainty. Let us recall that Angela Merkel stepped down as Chancellor of Germany in December 2021 after 16 years as Chancellor. Merkel’s decision was her own.
The Legacy of the Economic Miracle
During Merkel’s time, Germany was considered the economic engine of Europe. Germany enjoyed the benefits of globalisation and its close integration with the markets of China, the United States and other key partners. Today, however, not everything is as rosy as it was under Merkel.
Whilst Germany remains the fourth largest economy in the world, its dependence on traditional industrial sectors, namely the automotive and mechanical engineering industries, is in-fact a double-edged sword. The transition to green energy and the crisis of supply chains have turned out to be serious challenges for investors and consumers alike.
Political Crisis and the Search for a New Course
Merkel’s era is remembered as for its political stability. The coalition led by Olaf Scholz faced a number of problems: unstable coordination and a decline in public trust. Opposition parties are gaining strength, and the immigration issue, which Merkel solved with great compromise, is again coming to the fore.
Despite the gloomy forecasts, Germany has all the resources to restore itself with the correct political leadership. Any new government, in the Bundestag, must address investment in new technologies, energy independence, innovation, and the quality of human capital.
When Germany sat at the height of power, it played a key role in the European Union. Merkel skillfully balanced the interests of Brussels, namely the Eurozone Crisis, with Germany’s national priorities. Germany will have to overcome the challenges of globalisation, the energy crisis, and technological backwardness in order to regain its status as the leader of Europe and the world economy.
