WORLD NEWS FOR MONTENEGRO DIASPORA
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AUTHOR:M.J. GDNUS
Incoming German Chancellor Friedrich Merz today named Katharina Reiche, the CEO of a public company, as the future economy minister, while he nominated Johann Wadeful, a foreign policy expert and close associate, as foreign minister, as part of his first personnel decisions.
Merz's conservative CDU/CSU coalition, which won the February elections, reached an agreement earlier this month to form a coalition government with the Social Democrats (SPD) in order to quickly deal with a series of international crises.
The new government aims to revive growth in Europe's largest economy at a time when a new wave of recession threatens, caused by the global trade war that US President Donald Trump has launched with the introduction of sweeping tariffs. It also plans a significant increase in defense spending due to tensions within the NATO alliance.
Merz hopes his government will avoid the internal divisions that marked the previous three-party coalition led by Social Democrat Olaf Scholz, which ultimately led to its collapse last November. He believes the new government will be more decisive and effective.
Even before officially taking office, Merz and the SPD managed to push through parliament a historic fiscal package that will allow for a significant increase in investment in infrastructure and the defense sector.
According to the coalition agreement, the Christian Democrats (CDU) will be given the economy and foreign affairs portfolios, their Bavarian allies in the Christian Social Union (CSU) the interior ministry, while the Social Democrats (SPD) will take the defense and finance ministries.
Germany's most popular politician, Boris Pistorius, is expected to remain at the defense ministry, while SPD leader Lars Klingbeil is expected to become finance minister.
Economic plans
The new coalition plans to cut taxes for middle- and lower-income earners, lower corporate income tax, lower energy prices, support the development of the electric car industry and repeal the controversial supply chain law.
Faced with increasing pressure from the right-wing Alternative for Germany (AfD), the coalition has announced a tougher approach to migration policy. It has also promised strong support for Ukraine and increased military spending in light of Russia’s increasingly aggressive policies.
Katerina Reiche, a former member of parliament, has been running regional energy company Vestenergi since 2020, which is part of E.ON, Europe’s largest electricity grid operator. Before that, Reiche was CEO of the German Association of Local Utilities (VKU) and sits on the supervisory board of automotive supplier Schaeffler.
Numerous business associations praised the 51-year-old as a capable manager with extensive experience in the sector on Monday. Reiche will succeed Robert Habek of the Green Party, who led the economy ministry during Europe's energy crisis and was often criticized by the opposition for what they said was a lack of expertise. Outside of politics, Habek was known as an author, especially of children's books.
Johan Wadeful, a member of the Bundestag since 2009 and deputy leader of the conservative CDU/CSU faction in charge of foreign policy and defense, will take over as foreign minister. He will succeed Analene Berbok of the Greens, who has often clashed with Scholz and the SPD on foreign policy issues.
Analysts say the fact that the conservatives hold both the chancellor's office and the foreign ministry, and that Wadeful is a close associate of Merz, is likely to bring about a clearer and more consistent German foreign policy, which allies will appreciate.
“Merc has laid the foundations and structures to be a very strong chancellor when it comes to foreign policy,” said Jana Pugljerin, head of the Berlin office of the European Council on Foreign Relations (ECFR). “He will be responsible for relations with the United States, China and Russia.”
New Ministry for Digitalization
Aware of the need for Germany to advance the digitalization of its economy, Merck has established a new Ministry for Digitalization within the coalition, which will be headed by Karsten Wildberger, an experienced businessman, the conservatives said.
“The establishment of the new ministry is a milestone for Germany,” said Ralf Wintergerst, president of the German digital association Bitkom.
Wildberger has led the Ceconomy AG trading group since 2021 and was previously a board member of E.ON, Telstra and Vodafone.
At the same time, the nomination of Alexander Dobrindt of the CSU as interior minister suggests a tougher stance on migration, as the new coalition seeks to reduce support for the anti-immigrant Alternative for Germany (AfD), which has recently topped some polls. The Social Democrats will name their ministers after the party's membership approves the coalition agreement by vote, SPD leader Lars Klingbeil announced.
The results of the vote are expected on Wednesday.
Friedrich Merz is scheduled to be sworn in and officially take office on May 6.
