Germany: Political Developments and Data in 2023

Abstract

After a focus on global challenges, in the year 2023, domestic politics took centre stage in Germany. Notably, there was a rise in internal tensions within the ‘traffic light coalition’, especially regarding fiscal policy issues: The Free Democrats’/Freie Demokratische Partei (FDP) austerity clashed with the Social Democrats’/Sozialdemokratische Partei Deutschland (SPD) and the Alliance 90/Greens'/Bündnis 90/Die Grünen willingness to take on more debt for economic challenges. A key event was the Federal Constitutional Court's ruling that prohibited the reallocation of COVID-19 relief funds to the Climate and Transformation Fund, exposing budgetary constraints and repercussions on economic policy more broadly. The so-called Heating Act and debates on Child Basic Security were also important. The Alternative for Germany/Alternative für Deutschland (AfD) achieved notable electoral victories, while the Left Party's/Die Linke future is more uncertain than ever, having lost its parliamentary group status in the Bundestag due to a split. Regional elections were held in Berlin, Bremen, Bavaria and Hesse, contributing to this year's political dynamics.