German citizens went to the polls yesterday to elect a new . managed to win another term in office, but with a substantially reduced vote share and new junior coalition partners. This DeHavilland EU briefing takes a first look at the outcome of the election, in a momentous year for Europe.

When the exit poll for 's federal election was released on Sunday evening, there was no surprise that the CDU/CSU managed to win a fourth consecutive term in office. German voters value the stability offered by Angela Merkel and opposition leader was unable to convince them that the country would benefit from a change of Chancellor.

More surprising, however, was the extent to which the two main parties underperformed. Taking just 53.5% of the vote share between them, both Ms Merkel and Mr Schluz will be disappointed with the result. The SPD's showing was particularly weak, after they struggled to differentiate themselves from the CDU after four years in a . The CDU themselves appear to have been punished for moving in to the centre ground, losing large numbers of voters to both the FDP and AfD.

Shortly before the election result the SPD ruled out the possibility of renewing such a coalition, meaning that Angela Merkel will have to turn to the FDP and Greens to form a so-called 'Jamaica Coalition'. Although there is precedent for such a grouping at state level, it is untested in federal government and there are fears in the CDU that relying on two junior partners with such divergent political views will make for a rocky four years.

© DeHavilland Information Services Ltd 2017 1

Negotiations between the parties will begin almost immediately. The FDP – who are passionate economic liberals – have said that they want to be offered the Finance Ministry as part of any coalition deal. Were that to happen, it would give the party a strong voice in the debate on infrastructure spending at home and reform of the Eurozone in the European institutions.

The other big surprise from Sunday is just how well the AfD performed. Although the SPD's decision to not renew the Grand Coalition denies the AfD the position of official opposition, their projected 94 seats in the Bundestag will give them plenty of exposure – though one of the party’s leaders has unexpectedly announced this morning she will not be joining her new legislative cohort. Early analysis of the result shows that they took votes from across the political spectrum – on from the CDU/CSU, and on from both the SPD and The Left – and convinced more than a million non-voters to go to the polling booth.

 Angela Merkel – Despite seeing her party's  Martin Schulz – When he became leader of vote share sink to its lowest level since 1949, the SPD at the beginning of the year, the the CDU/CSU finished a full 12.5% ahead of former European Parliament President their closest rivals. The achievement of a enjoyed greater popular support than Ms fourth straight term in office should not be Merkel and had his party dreaming of understated. The woman that Germans call victory. His fall, and that of the SPD, has "Mutti" (mother) is now set to overtake been stark and the party enter opposition Helmut Hohl as the country's longest with their lowest vote share in post-war serving Chancellor Germany.

 FDP – After the shock and disappointment  Europe – Germany is undoubtedly the most of failing to reach 5% of the vote in 2013, powerful player within the EU and and therefore not take any seats in the Eurozone. The received wisdom had been Bundestag, the FDP have carried out a that the country's economic and political successful comeback. Young leader success meant Germany would not 's rebranding of the party succumb to the same populist wave that seems to have been a success, and the FDP had tainted other recent elections in Europe, could find themselves in a strong position so the AfD's performance will have shocked in a new coalition. many. Those hoping for German-led EU reform or greater flexibility in the Eurozone  AfD – After weeks of strong performances will also be disappointed that the fiscally in the polls, it came as no surprise that the liberal FDP will almost certainly be a junior AfD won seats. Nevertheless, the size of partner in the new governing coalition. their vote share is higher than most expected and makes them Germany's third largest party. The AfD become the first far- right, nationalist party to enter the Bundestag for more than 50 years.

© DeHavilland Information Services Ltd 2017 2

Estimated election result

CDU/CSU - 33% (-8.5%) SPD - 20.5% (-5.2%) AfD - 12.6% (+7.9%) FDP - 10.7% (+5.9%) The Left - 9.2% (+0.6%) Greens - 8.9% (+0.5%) Others - 5.1%

Projected seat allocation in the Bundestag

CDU / CSU (246) SPD (153) AfD (94) FDP (80) The Left (69) Greens (67)

© DeHavilland Information Services Ltd 2017 3

"Of course we expected a slightly better result, that’s totally clear […] we want to win back the voters of the AfD" – Angela Merkel, German Chancellor

"We had a vacuum on the right side that we need to close now" – Horst Seehofer, CSU leader and Bavarian Prime Minister

"We did not manage to persuade all of our voters that Germany is strong enough not to leave anyone behind" – Martin Schulz, SPD leader

"It’s about stability now, all parties have to take responsibility. We will not be pushed into a coalition just because the SPD makes a unilateral retreat into the opposition" - Christian Lindner, FDP leader

"We have a job to do for the voters. They voted for us as a party that represents a united Europe" - Katrin Göring-Eckardt, Greens Spitzenkandidat

"The government, whatever it will look like, should get ready for tough times. We’ll chase them. We’ll take back our country and our people" - , AfD Spitzenkandidat

"With Angela Merkel, Germany remains the strong and reliable partner in Europe. This is a signal of continuity and partnership" - Manfred Weber, EPP leader

"The FDP will be a strong liberal voice in the German Bundestag against the AfD's nationalist propaganda" - , MEP and ALDE leader

"I have called Angela Merkel to congratulate her. We will be continuing our cooperation, which is essential for Europe and our countries, with determination.” - Emmanuel Macron, French President

"Congratulations to Frauke Petry and the AfD!” - Geert Wilders, Dutch Party for Freedom leader

© DeHavilland Information Services Ltd 2017 4

This briefing is an example of the in-depth political information DeHavilland EU provides to public affairs and policy professionals every day. Our analysts gather vital political news from the European institutions to bring our customers reports tailored to their information needs.

To find out how DeHavilland EU’s political intelligence can help your organisation, and to request a free trial, contact our team now.

Just visit https://www1.dehavillandeurope.eu/contact-us-eu or call +32 (0) 2 893 9722.

© DeHavilland Information Services Ltd 2017 5