The new German government coalition Officially signed the formation agreement

A coalition agreement was signed in Berlin on Monday between the conservatives, led by incoming German Chancellor Friedrich Merz, and the center-left Social Democratic Party (SPD), paving the way for the formal announcement of the new government on Tuesday, following legislative elections that saw a major political shift in the country.

The agreement represents a roadmap for the next four years in Europe’s largest economy and outlines the priorities of the new executive branch at a time when the country is facing mounting economic and geopolitical challenges, most notably reviving a stagnant economy for two years, countering the rise of the far right, and strengthening European defense in light of the US strategic retreat.

“If I am elected tomorrow, you will have a government determined to move Germany forward through reforms and investments… a government that strives to be reliable from day one,” Friedrich Merz, leader of the Christian Democratic Party, said in a statement before the agreement was signed.

The agreement was signed alongside him by the leaders of the Social Democratic Party, Lars Klingbeil and Saskia Esken, and Markus Söder, leader of the allied Bavarian party.

In a related context, Merz noted that the country is undergoing a period of profound change and major upheaval, emphasizing that leading this coalition to success represents a historic duty.

For his part, Lars Klingbeil, Vice Chancellor and incoming Finance Minister, emphasized the need for true teamwork, asserting that the best thing to do in a democracy is to build bridges, not destroy them.

The formation of the new government comes at a time when the far-right Alternative for Germany party is betting on the coalition’s failure and hopes to make major gains in the next legislative elections scheduled for 2029.

Merz will be formally elected chancellor of the Bundestag on Tuesday, following his victory in the February 23 election, which resulted in a heavy defeat for the previous government of Olaf Scholz.

The Social Democratic Party announced that Boris Pistorius will retain his position as Minister of Defense in the new government.

He is expected to lead efforts to rebuild the armed forces and enhance support for Ukraine, particularly in light of the security challenges facing Europe since the Russian invasion three years ago.