EZA Report 921 German politics: no big leap reform to be expected from new government
06 November 2009
- The 24th Oct coalition agreement between the conservatives and the Free Democrats marked the beginning for the new German government and the second term for chancellor Angela Merkel.
- Fighting the financial and economic crisis remains a key priority. Fiscal stimulus in 2010 will be slightly enhanced, with a shift from spending-related stimulus to tax cuts.
- Other features in economic policy will be cautious pro business reforms and health care reform. FDP ambitions for a major overhaul of the health care funds will face strong opposition from the conservative CSU.
- Merkel’s choice of finance minister, Wolfgang Schäuble, was as much a surprise as the promotion of Philip Rösler to health minister. The appointment of Schäuble, a CDU political heavyweight, confirms Merkel’s focus on fiscal policy.
Asset conclusions: agreement positive for German assets, notably stocks and the euro.
Please see attached 5 page analysis from Michael Clauss as a pdf to read onscreen or simply print.
Dr Michael Clauss: Germany Politics / Economy / Equities Sectoral Analysis
Tel: +49 89 64254046
michael.clauss@eurozoneadvisors.com
Discussion Partners
John Arrowsmith: ECB / Regulatory
Tel: +44 7720 59 1726
john.arrowsmith@eurozoneadvisors.com
Dr Michael Clauss: Germany Politics / Economy / Equities Sectoral Analysis
Tel: +49 89 64254046
michael.clauss@eurozoneadvisors.com
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