Europe war-games life after Merz

The German chancellor’s foes at home are rejoicing at his political downturn. But those in Brussels aren’t.

By GABRIEL GAVIN and FRIDA PREUß

^{Illustration by Natália Delgado/ POLITICO}

The EU can’t pretend Friedrich Merz isn’t in trouble any longer.

After a string of humiliating election losses where the far right has made historic gains and an internal fight with his own coalition over social care policy, EU partners are starting to plan for the prospect that the German chancellor could be ousted — or at least distracted — in the crucial coming months, according to five diplomats and officials who spoke to POLITICO. They were granted anonymity to discuss the sensitive talks.

Two European governments have even held internal sessions to game out what the end of Merz’s chancellorship would mean for EU policymaking, two of those familiar with the discussions said.

It’s not a prospect they take lightly. Merz leads the EU’s largest economy and is the chief negotiator for wealthy countries seeking to rein in spending in the bloc’s proposed €2 trillion seven-year budget. He is also a driving force behind EU efforts to save heavy industry.

“Any debate about the German chancellor weakens Germany’s role in the EU and in the world,” said Wilhelm Gebhard, a member of the Bundestag and an official in Merz’s governing CDU party.

With France facing its own far-right surge and a presidential election next year that could hand power to euroskeptic Marine Le Pen, few in Brussels relish the prospect of Germany, historically the EU’s other major player, turning inwards or derailing important negotiations.

The contingency planning, which has seen officials and diplomats brainstorm the situation, comes after months of mixed signals from Berlin on EU policy, including car emissions and a proposed social media ban for children. Even if Merz stays in office, the political turmoil is already complicating Berlin’s work on the EU’s biggest files.

The worst-case scenario for Brussels would be a leaderless Germany, or one with a far-right government. But that is seen as virtually impossible in the short term, with none of the mainstream players seeking new elections while the far-right Alternative for Germany party are leading in the polls.

“All coalition partners know that they have a great deal to lose from early elections,” said Hannah Neumann, an opposition Green MEP who sits on the European Parliament’s security and foreign affairs committees. “My expectation, therefore, is that they will stay together and muddle through.”

While Merz himself could be forced to resign in the face of his growing unpopularity, he would be replaced straight away by a successor from either his center-right CDU party or his center-left coalition partner, the SPD. That should give Brussels confidence “someone will always be in charge,” said one of the diplomats.

Searching for a win

Those who know him insist Merz won’t be distracted when it comes to EU affairs.

“Other politicians might say ‘OK, I focus less on EU politics.’ For him it’s just the opposite: It’s an additional incentive to show leadership in Europe,” said a person familiar with the chancellor’s thinking.

In the immediate term, Merz’s political weakness at home could make finding compromise on the bloc’s next seven-year budget harder by pushing the chancellor to double down on Berlin’s hardline stance in search of a win, a further two diplomats warned.

As the leading voice for countries seeking a smaller EU budget, which leaders hope to agree by year-end, Merz has called for cuts of “hundreds of billions of euros.” Germany, Sweden, Finland, Denmark, Austria and the Netherlands are pressing for overall reductions, while net recipients such as Poland and Romania want to protect their share.

Nobody who could replace him as chancellor “would be able to be more flexible than Merz is,” said one of the diplomats, but “the risk is he has to show his self-perceived leadership in Brussels in the hope it will help his standing in Germany.”

An envoy from another country said “domestically he is weak [which means] he can’t compromise” and needs to be seen to score a win by slashing the budget as far as possible.

But Merz’s allies say his fight on the world stage is only worthwhile if his coalition partners play along behind the curtain.

“Strength comes not just from grand appearances in Brussels, but above all from stability, reliability and the ability to push through decisions at home. That is precisely what is lacking at the moment,” said CDU Bundestag member Fabian Gramling. “Germany’s influence in Europe also depends on how united and capable of action the federal government appears at home.”

Infighting and indecision

The fractious relationship between the CDU and the SPD has already been undercutting Berlin’s stance on issues of critical national importance.

Throughout 2025, as Brussels renegotiated a planned phaseout of combustion engine cars, in the face of fierce lobbying from Germany’s influential automotive sector, German officials and diplomats were unable to articulate a clear position, with center-right ministers wanting to scrap the green policy and their center-left counterparts pushing to preserve it.

Ultimately Merz’s fellow German conservatives in Brussels — Commission President Ursula von der Leyen and European People’s Party chief Manfred Weber — stepped in to kill the proposal at the eleventh hour.

Another key policy area where the coalition struggled to agree a position was on whether children should be banned from social media, a flagship EU-wide proposal from von der Leyen. While Merz personally backed the idea at the start of the year, he and his political allies spent more than six months struggling to land on a specific age limit to lobby for when von der Leyen was consulting with partners, according to officials and diplomats involved in the talks.

Even before the latest crisis, Merz’s domestic troubles were spilling into Brussels at the highest level. Last year, he surprised fellow EU leaders by demanding that a summit scheduled to cover geopolitics and other policy files should instead focus on saving European heavy industry from competition with the U.S. and China.

Germany lost around 124,100 industrial jobs last year, according to an analysis by EY, with the government concerned deindustrialization is helping drive support for Merz’s far-right and far-left rivals. Other capitals share his concerns, but Merz has insisted industry should top the agenda at future summits.

But even inside the chancellor’s own CDU, he has struggled to achieve consensus on what to do about it. As the Commission plans a push against unfair Chinese trade practices, Merz’s fellow party member and foreign minister Katherina Reiche is seen as more protective over the relationship with Beijing, and the German industrial giants like Volkswagen and BASF that trade with it.

In a speech on Thursday commemorating 36 years of German reunification — the fall of the Berlin Wall and the dissolution of communist East Germany —the country’s ambassador to the EU, Thomas Ossowski, told fellow envoys and officials that “whenever we celebrate German unity, we celebrate European unity. And we need this unity [now] more than ever.”

Gabriel Gavin reported from Brussels. Frida Preuß reported from Berlin. Jordyn Dahl, Eliza Gkristi and Carlo Martuscelli contributed to this report.