Merkel’s departure marks the end of an era in Germany

After 16 years in power, Angela Merkel did not run for chancellor in the latest German election. Natalie Keffler asks what the impact of this will be on the German economy, and what legacy has she left?


During her time as Chancellor of Germany, Angela Merkel has shaped the country into one of the most highly reputed nations in Europe. Now, in 2021, she has stepped down from her role, and Germany has been left waiting for the formation of a new government, following an inconclusive election in September. The Social Democratic Party (SPD) emerged as the strongest option in the election and, along with the Greens and the Free Democrats, have opened formal coalition talks, with Olaf Scholz, Annalena Baerbock and Armin Laschet all looking like the frontrunners for the coveted role of Chancellor.

However, all the parties accept that the situation is complex, and it will take time to come to a satisfactory resolution to form this new government. In the meantime, Merkel and her government will remain as caretakers of Germany until a decision is made.

The rise of Merkel
Merkel was born in 1954, and for the first 35 years of her life, she lived in Soviet-controlled East Germany. Here, she worked at a state-run research centre as a research scientist, until the fall of the Berlin Wall in 1989. The historic shift that the fall of the wall brought about led to Merkel abandoning the scientific work she had been carrying out, and instead she turned her hand to what would become a lifelong interest in politics. Merkel was first elected Chancellor of Germany in 2005, becoming the first woman, and the first East German, to hold the nation’s highest elective office. She has held this position for so long in fact that she has become Germany’s second longest-serving leader of the modern era, after her former mentor, Helmut Kohl, who was also chancellor for 16 years.

During Merkel’s time as Chancellor, she has achieved a great deal, but the aspects she will be remembered for most by her country, and the world more widely, are her commitment to emissions cuts, and arguably even more so than this, her actions with regard to the refugee crisis. Merkel’s decision to allow over one million refugees to enter Germany in 2015 and 2016 is how many supporters and critics will define her legacy. Her support of migration earned her praise by her supporters, and those more left-leaning in Germany. However, these actions were criticised by the far right, who were concerned Merkel represented an open-border immigration policy that had gone disastrously wrong.

To find someone who possesses both her stability and strength, someone who can unite all of Germany and the EU, will be a challenge

What no one can argue with though is Merkel’s popularity over the years, having affectionately been referred to as ‘Mutti,’ meaning ‘mother’ in German. While initially used as a patronising term by her critics, it has since been rebranded as a term of endearment. While other world leaders have come and gone, Merkel has remained, a figure of stability in Germany, avoiding scandal in a way her predecessors and many other European politicians have not. Merkel has led Germany through a global financial crisis, the Eurozone debt crisis, the immigration crisis, and most recently, the pandemic. Her unwavering statement of “we will manage” when faced with an escalating immigration crisis neatly encapsulates the spirit with which she has carried the German nation through tough times. Therefore, to find someone who possesses both her stability and strength, someone who can unite all of Germany and the EU, will be a challenge.

New directions
Germany’s newly elected parliament held its first meeting on October 26 of this year, following the September election. The German President, Frank-Walter Steinmeier, formally dismissed Merkel and her Cabinet. However, they will remain in a supervisory position until a new government officially takes office. The SPD candidate for chancellor and the former vice-chancellor under Merkel’s fourth government, Olaf Scholz, is one of the leaders tipped to replace Merkel. Scholz has previously served as the finance and interior minister for Germany, and is one of the longest-serving members of parliament.

However, although his experience as finance minister does benefit him, his critics have also thrown accusations his way regarding two big financial scandals, aiming to cast doubt on his suitability as a candidate for chancellor. But in terms of popularity, he’s a runaway leader in the polls; it was revealed in at least one survey that if the German people were voting for their next chancellor, Scholz would be the one they would choose to elect.

For some of the German population, and more widely, other world leaders, Merkel is leaving her final term as a chancellor on something of a high, with unemployment in the country down by six percent, which is half of what it was when she first became chancellor in 2005.

In addition, Merkel’s government’s economic policies have helped Europe’s largest economy recover, twice. However, for some German economists, Merkel’s fourth term as chancellor has been viewed as a time of slippage in the country’s competitive drive, with widespread agreement that Germany’s physical and digital infrastructure is now backward. Therefore, in the lead-up to the election, promises from other parties included these specifics as areas they would focus on, should they come to power, as well as promising to look at tax and pension reforms.

The view of a post-Merkel Germany
Germany has always held a certain weight in European policymaking. Therefore, the next chancellor will not just be responsible for leading Germany through crises, but also the whole of Europe. The predicted coalition is likely to be more in favour of EU integration than Germany previously has been, and there is even more reason that the next chancellor will have to take charge on many issues arising within Europe. One of the tasks awaiting the next chancellor is the need to update The Banking Union, which was first introduced in the wake of the debt crisis. However, this could cause controversy within Germany due to many of the population having concerns that updating this union will lead to them paying massive bills in order to support euro nations that are less financially conservative. In addition, the eurozone is also due to update its debt and fiscal rules in 2022, another matter at hand that the new chancellor will have to decide their stance on. One final economic issue that will soon need to be tackled is whether the recovery fund, initially meant as a one-off measure to fund the EU’s recovery from the pandemic, should become a permanent feature within the EU.

This fund would require the backing of the new chancellor, and the position that they take on this is crucial, as the other member states look to Germany for leadership. Will a post-Merkel Germany continue to lead Europe? It remains to be seen whether the new coalition government aligns Germany closer to or further away from the EU.

Merkel’s legacy
When Merkel announced her departure from German politics, it was widely acknowledged what a significant impact this would have not just on Germany, but Europe too. Her ability to remain in power for so long as chancellor is the reason why she has become a symbol of political stability. However, her ability to ward off political opponents over the years is partly what has led to the current situation, where there isn’t a clear heir to take the reins.

The legacy Merkel will be leaving behind can be summed up as a continuing defence of the liberal world order, a title allocated to her as a result of her consistent support of refugees, as well as her support of the laws that seek to address the climate crisis.

Her policies over the years have contributed to her shifting the Christian Democrats party significantly to the centre. However, this has resulted in a rise of the far right populist group, Alternative for Germany (AfD), who now hold 92 seats in Germany’s parliament, having not previously won seats in the Bundestag prior to 2017. Merkel will remain in a caretaker role until the new government is officially in place, which might not be until Christmas.

After the new chancellor has been appointed, she will be able to completely step back, and will be granted an initial transitional allowance of half her pay, after which time she will be entitled to a pension, from her work as chancellor, government minister, and member of the Bundestag.

The next chancellor faces the significant challenge of running a country that has come to be relied upon as one of the world’s great economic leaders. Other countries, particularly within the EU, will look to Germany for guidance and to help Europe recover from the continued economic fallout from the pandemic. For many, Merkel’s departure represents the end of an era. For the first time in over a decade and a half, Germany must manage without its mother.