The left-of-centre Social Democrats won a narrow victory in Germany’s election, as support for the centre-right CDU/CSU of outgoing chancellor Angela Merkel plunged to a historic low.
The SPD’s candidate for chancellor, finance minister Olaf Scholz, said he had won a mandate to form Germany’s next government. He is likely to seek to form a coalition with the Greens, who recorded their best ever performance in a Federal election, and the business-friendly Free Democrats.
Preliminary results announced early on Monday gave the SPD 25.7 per cent, a huge improvement on the 20.5 per cent it garnered in the previous Bundestag election four years ago.
Merkel’s Christian Democratic Union, in alliance with its Bavarian sister party the CSU, won 24.1 per cent of the vote, the worst national result in its history.
The Greens secured 14.8 per cent, making them Germany’s third largest party and the big winner of Sunday’s election. Four years ago they had garnered only 8.9 per cent. The FDP won 11.5 per cent.
The SPD’s victory represents one of the most remarkable turnrounds in recent German political history. For months the party was pegged at about 15 per cent in the polls. Much now depends on whether the smaller parties, the Greens and FDP, decide to team up with the CDU/CSU or the SPD.
Read more
Explainer: Here is where the policies of Germany’s biggest parties overlap and diverge.
Analysis: Who follows Merkel? The vote leaves the smaller Greens and FDP parties with the power in coalition talks, writes Berlin bureau chief Guy Chazan.
Comment: The CDU managed to claw back just enough ground to take the shine off a remarkable climb for Scholz, writes Ben Hall.
Subscriber event: Join FT Berlin bureau chief Guy Chazan, Erika Solomon, Berlin correspondent, and Sam Fleming, Brussels bureau chief, for a discussion hosted by Valentina Pop, Europe Express editor. Sign-up here.
Five more stories in the news
1. Democrats face intense week of haggling Democratic speaker of the House of Representatives Nancy Pelosi has delayed a vote on Joe Biden’s $1.2tn infrastructure bill until Thursday. The vote was expected today but Pelosi confirmed the delay late on Sunday amid divisions within the president’s party.
2. Cryptocurrency exchanges start cutting off Chinese users Cryptocurrency exchanges such as Huobi and Binance have begun cutting links with customers in China after the People’s Bank of China made it illegal for exchanges to provide services to Chinese users.
3. Electric car maker Polestar plans to go public The Swedish electric vehicle company backed by Volvo Group and actor Leonardo DiCaprio is set to go public through a special purpose acquisition company at a $20bn valuation, according to people familiar with the matter.
4. Evergrande electric car division cancels Shanghai listing Shares in Evergrande’s electric vehicle unit tumbled in Hong Kong today after it scrapped plans for a secondary listing on Shanghai’s Star Market, as bondholders remained in limbo after the indebted Chinese property developer missed a crucial payment last week.
5. Peru’s radical left government weighs bond issue Peru’s finance minister Pedro Francke says foreign investors have shown so much interest in buying bonds that the government may consider a fresh issue to take advantage of their appetite. Last week, Francke and recently elected hard-left president Pedro Castillo spent time in the US speaking to nervous investors.
Coronavirus digest
The director of the Centers for Disease Control and Prevention said that healthcare in some parts of the US was in “dire straits” as some 70m people in the country remained unvaccinated.
With vaccines being administered worldwide, scientists are preparing a new weapon to combat Covid: an antiviral medication to treat the worst symptoms.
The pandemic has triggered the largest falls in life expectancy since the second world war in most developed nations, with US men the hardest hit.
Follow our live coverage and sign up to the Road to Recovery for a regular briefing on business and the economy in a world transformed by the pandemic. Plus, our special report on communicable diseases is published today.
The day ahead
Google in court to fight EU fine Google begins its appeal today in an EU court against a record fine for alleged anti-competitive behaviour. In the five-day hearing the US tech group will outline its case against the EU’s €4.34bn fine imposed for stifling competition through the dominance of its Android operating system. Our Europe Express newsletter sets the scene.
Fed speakers Federal Reserve Bank of New York president John Williams will address the US economic outlook at an event hosted by The Economic Club of New York Federal Reserve Bank of Chicago president Charles Evans and Federal Reserve Board governor Lael Brainard speak at the annual meeting of the National Association for Business Economics.
Euro questions The European parliament’s economic and monetary affairs committee will quiz European Central Bank president Christine Lagarde on the state of the eurozone, inflation and risks to price stability. (EU Reporter)
US durable goods Positive business investment and consumer spending are expected to have boosted new orders for US durable goods in August, data for which are expected today. (WSJ)
What else we’re reading
‘I have no personal friendship or enemies. It’s law’ Gillian Tett has lunch with Manhattan’s district attorney, Cyrus Vance Jr, in the DA’s downtown skyscraper. Over a chicken salad from Pret A Manger, they discuss the case against Donald Trump, prosecuting big banks and the battle to bring Harvey Weinstein to justice. “It is the most low-key fare I have encountered for this column, the ultimate anti-Trump, anti-graft lunch,” writes our US editor at large.
Evergrande’s lessons for China For much of this year, commentators have been warning that falling yields suggest the bond market is increasingly irrational. Now, Ruchir Sharma writes, events in China suggest bond markets are far from clueless or crazy.
No country for young men For decades, old men have pulled the strings in Japanese politics, writes Kana Inagaki. But young parliamentarians are seeking a bigger voice in governing the world’s fastest ageing society as the race to replace Prime Minister Yoshihide Suga heats up.
Beware the pitfalls of the post-pandemic hybrid event While in-person business events across the world have picked up again recently in some sectors, the concept of “hybrid events” — trade shows, conferences, seminars or meetings that combine in-person and virtual elements — is emerging as the new shape for post-pandemic professional gatherings.
Opinion: The Big Schmooze is coming back, writes management editor Andrew Hill. But the pandemic has forced a corporate rethink on short-haul business travel and exposed the fallacy that face-to-face networking is an indispensable prelude to dealmaking, he argues.
Travel
Four new hotels for a great city break Maria Shollenbarger checks in to some chic staycation destinations in Los Angeles, London, Paris and Boston.
Source: Economy - ft.com
