Germany: Prepare for an exciting election

In just over five months’ time, people in Germany will go to the polls. As in most elections, the economy is set to become a main focus point.

While Angela Merkel’s CDU party is likely to emphasise the country’s strong economic fundamentals, the SPD, and front-runner, Martin Schulz, will likely criticise shortcomings in the current growth performance. To many, this campaign will sound like two tales from one economy.

In this report, ING's Frankfurt-based chief economist, Carsten Brzeski looks at just what’s at stake. While the German national elections are unlikely to deliver a populist surprise, a new government and a new chancellor is clearly a possibility. We think that chance has yet to be factored in by the markets.

Carsten looks at the strengths of the German economy, but also its weaknesses. He suggests that the labour market is in need of reform and the education system and modern infrastructure investment should also be a top priority for politicians. He also looks at what the results could mean for the future of the eurozone.