German govt in crisis as coalition collapses

German Chancellor Olaf Scholz has called for a vote of confidence on Jan 15 after his ruling three-party coalition collapsed on Wednesday following his announcement to fire Finance Minister Christian Lindner amid rows over economic plans.

If Scholz loses the confidence vote from lawmakers, a snap election is expected to be held before the end of March.

"All too often, Minister Lindner has blocked laws in an inappropriate manner," Scholz said in a statement on Wednesday.

"Too often he has engaged in petty party-political tactics. Too often he has broken my trust," he said, adding there is "no more basis of trust for further cooperation".

The disputes inside the coalition government have been boiling for a long while, with severe strains on the 2025 budget and lackluster performance of the German economy.

Lindner and his Free Democratic Party, or FDP, have insisted that the German government stick to strict spending rules and cut taxes while the two left-leaning coalition partners want to maintain social spending and propel German industry through stimulus plans.

In a statement, Lindner criticized Scholz for failing to recognize the need for a new economic awakening in the country.

"He has long played down the economic concerns of our citizens," Lindner said.

The FDP is the smallest party in the coalition and is now polling at only 4 percent, below the threshold to enter the German parliament. Scholz's center-left Social Democratic Party, or SPD, was polled in third place at 16 percent while the Greens stood at 11 percent, all below the 34 percent by the alliance of center-right Christian Democratic Union and Christian Social Union, or CDU/CSU, and the 17 percent by right-wing Alternative for Germany party, or AfD.

Snap election

It is widely expected that a snap election would result in a government led by CDU/CSU.

On Thursday, Friedrich Merz, leader of the CDU, urged Scholz to allow a vote of confidence immediately, "by the beginning of next week at the latest".

Elections could take place in the second half of January next year, Merz said. His comments were echoed by other opposition parties.

Ding Chun, director of the Center for European Studies at Fudan University in Shanghai, described the collapse of the coalition government as a result of the different backgrounds of the three parties, their declining ratings among the German public and the poor German economic situation.

"They formed the ruling coalition given their different political stance and voter base. But at a critical juncture when big troubles come, they fly their own ways," he said.

"Those who expected the US elections' outcome to bring together the German coalition government may soon be disappointed," Alberto Alemanno, a professor in European Union Law at HEC Paris, a business school, said in a post on X, referring to German public's concern about US President-elect Donald Trump's trade wars.

The latest ARD-Deutchland-TREND poll showed that a majority of German voters have run out of patience with the coalition government. While 54 percent would like to see early elections, only 41 percent are in favor of Scholz's coalition continuing until its regular term ends in the latter part of 2025.

Agencies contributed to the story.