Friedrich Merz is poised to become Germany’s next chancellor, but his victory may not deliver the stability many voters had hoped for.
The 2025 election marks a major turning point for Germany, with a sharp rightward shift and the collapse of the center-left.
Although Merz’s CDU/CSU secured the most votes, they fell short of a clear majority, complicating the path to stable governance.
The far-right AfD surged to second place, making coalition-building even more challenging. Meanwhile, economic stagnation, an aging population, and growing tensions with the U.S. present significant hurdles for the next government.
Germany has long been viewed as Europe’s pillar of stability, but that reputation now faces serious uncertainty.
Did voters actually get the change they wanted?
The message from voters was clear: they wanted change.
The turnout was 84%, the highest since 1990, which shows how much people cared about this election.
But the results tell a more complicated story.
The CDU/CSU won with 28.5%, a comfortable lead but far from a majority.
The SPD, which led the previous government, suffered its worst defeat since 1890 with just 16.4%.
The Greens held steady at 11.6%, while the FDP collapsed, failing to reach the 5% threshold to stay in parliament.
The big winner was the AfD. They doubled their support in 2021, securing 20.8% and becoming Germany’s second-largest party.
Their success was strongest in the East, where many voters felt left behind by Berlin’s policies.
Younger voters (18-24) also leaned toward political extremes, favoring the AfD on the right and the Left Party on the opposite end, while traditional parties like the CDU and SPD struggled to attract youth support.
Nevertheless, this election didn’t produce a clear mandate.
The CDU/CSU now faces the difficult task of forming a government, but their options are limited.
A coalition headache for Merz
Unlike other European countries, Germany does not allow minority governments.
That means Merz needs a coalition partner to govern.
Germany’s system requires a Bundestag majority (50%+1 seats) for a chancellor to be elected and pass laws, so parties must negotiate coalitions when no single party wins outright.
The CDU/CSU ruled out working with the AfD, citing major disagreements on NATO, the euro, and foreign policy.
That leaves the SPD or the Greens as the only realistic partners.
Both are reluctant, especially since Merz’s policies on deregulation, immigration, and tax cuts clash with their agendas.
The SPD is still reeling from its worst result in modern history and there’s a chance they may not want to enter government at all.
Some party leaders have suggested letting their members vote on any coalition deal, which makes things even more complicated.
If no deal is reached, Germany could face prolonged political paralysis.
The longer it takes to form a government, the weaker confidence will become, both at home and abroad.
Can Germany fix its economy?
Beyond politics, Germany’s biggest challenge is its economy.
The country has now endured two years of economic contraction, with no real recovery in sight.
Growth forecasts are grim. The German Council of Economic Experts predicts potential growth of just 0.3%-0.4% per year for the rest of the decade, far below the 1.4% average from 2000 to 2019.
The main reason is that Germany’s population is aging rapidly.
Over the next four years, 5.2 million Germans will retire, while only 3.1 million young workers will enter the workforce.
That imbalance will shrink the labor force, increase pension costs, and strain the federal budget.
Meanwhile, rising healthcare costs and high social security contributions, which are already high at 42% of gross income, are making life harder for businesses and workers.
Merz has promised an “Agenda 2030” to revitalize the economy through tax cuts, deregulation, and incentives for older workers to stay employed.
But how he plans to pay for these policies remains unclear, especially with a coalition partner likely to push back on his more conservative ideas.
Is Germany turning against the US?
Germany’s political and economic challenges are happening at a time when its relationship with the US is deteriorating.
Merz has made it clear that he sees European security as a top priority.
After Donald Trump’s return to the White House, Merz warned that Washington’s commitment to NATO is no longer guaranteed, saying:
“America First may mean America alone.”
Merz believes that Germany and the EU might need to build their defense capabilities, especially since Trump is now pivoting to Russia’s side.
This is a big deal for Germany.
Since World War II, Germany has relied on US security guarantees. If that changes, Germany may have to increase its defense spending beyond the current commitments to Ukraine (€28 billion so far) and NATO.
That would put further pressure on an already stretched budget.
Meanwhile, trade tensions with the U.S. could also complicate Germany’s economic recovery.
Protectionist policies from both sides threaten German exports, particularly in the manufacturing and automotive sectors.
What’s next for Germany?
Germany’s election results have clearly shown that voters want change.
The CDU/CSU won, but their path to forming a government is far from certain.
The economy is slowing down, and demographic shifts will make growth harder to sustain.
Meanwhile, relations with the U.S. are evolving in ways that could force Germany to take on new responsibilities it isn’t fully prepared for.
For now, the biggest risk isn’t just economic stagnation or political gridlock, but the loss of confidence.
If the new government cannot deliver on voter expectations, extremist parties like the AfD may grow even stronger by the next election.
Experts believe that Germany is facing its biggest challenge since its reunification.
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