Last week, amid various domestic and international challenges, Germany’s conservative center-right Christian Democratic Party (CDU) and its Bavarian sister party, the Christian Social Union (CSU), announced a coalition agreement with the center-left Social Democrats (SPD). This coalition, unofficially known as the Grand Coalition, aims to revitalize Germany, the world’s fourth-largest economy and Europe’s largest, in light of concerns about a potential recession due to an impending trade war. However, the coalition deal was announced at a time when the far-right Alternative for Germany (AfD), which placed second in the elections on February 23, has surpassed the CDU in a national opinion poll for the first time ever.
“The coalition agreement is a very strong and clear signal to the citizens of our country. It is a strong signal to our European partners. Germany is getting a strong government,” stated the chancellor candidate, the CDU’s Friedrich Merz, alongside his SPD coalition partners in Berlin. In light of the ongoing trade war initiated by U.S. President Donald Trump, Merz directly addressed the White House in English, saying, “The key message to Donald Trump is that Germany is back on track.”
Merz has promised to increase defense spending and enhance the competitiveness of the German economy. During the announcement of the coalition deal, he emphasized his commitment to reforming and stabilizing Germany, focusing on defense, the economy, and migration. He stated that “Europe can rely on Germany” and pledged to implement a “strong plan to bring our country to the forefront again.” Although Merz has not yet been elected as the German chancellor – the new parliament is expected to vote on May 6 – his election appears to be secure given that the CDU/CSU and SPD together enjoy a 13-seat majority in the Bundestag, Germany’s parliament.
The 144-page long “Responsibility for Germany” coalition agreement highlighted various domestic and global issues. In particular, its foreign policy focused on a “United Europe” and a “Secure Germany.” Aside from sections focusing on NATO, the United States, China, Turkiye, Syria, and many other countries and regions, the agreement also discussed the Indo-Pacific region. Under the Merz-led new government, Germany will have a clear focus on the Indo-Pacific.
The coalition agreement highlighted that “[a] stable, free and secure Indo-Pacific region is of fundamental interest to Germany and the EU.” The upcoming government looks forward to increasing Germany’s role there, as the agreement pledged that “[w]e will continue to maintain our presence in the region.”
Among the countries in the Indo-Pacific region, India, as an energy and security partner, holds great significance for the new coalition. “We are striving to strengthen strategic relations with India at all levels, including in the global energy transition and in security cooperation,” the coalition agreement stated. For both geopolitical and geoeconomic reasons, Germany has a growing interest in India. Thus, India was also in focus under Chancellor Olaf Scholz’s previous coalition, which to a certain extent set in motion Germany’s pivot to India. His government had issued a “focus on India” document last year a few days before Scholz’s visit to India in October 2024.
In addition to India, the new coalition also focuses on Australia, New Zealand, Japan, and South Korea. The agreement emphasized that “Australia, Japan, New Zealand, and South Korea are close value partners for Germany and the EU.” Therefore, it stated, “We will continue to pursue our comprehensive strategic partnerships with these and other important countries.”
This focus on the Indo-Pacific is not unique to the new government. In 2020, Germany adopted policy guidelines for the Indo-Pacific region, which pointed out: “With the rise of Asia, the political and economic balance is increasingly shifting towards the Indo-Pacific. The region is becoming the key to shaping international order in the 21st century.” The policy guidelines clearly articulated the core interests and guiding principles of Germany, which will continue to serve as the basis for its strategic approach in the Indo-Pacific during the next government’s term in Berlin.
Last year, Germany’s ambassador to Singapore, while addressing the Singaporean German Chamber of Industry and Commerce, pointed out that “trade with the Indo-Pacific region accounts for around one-fifth of Germany’s global trade. Jobs in Germany depend on trade with this vibrant region.” Furthermore, she highlighted that “the countries of the Indo-Pacific region are shaping the 21st century. Almost two-thirds of the global GDP is generated here. Over the past decades, this region has become a powerhouse in many respects. Its economies are growing fast and are well integrated into the world economy. Its population is well-trained and well-educated, full of expectations and ambitions.” As a result, Germany aims to maintain a strong and lasting presence in the region to enhance its geoeconomic and geopolitical influence and footprint.
The CDU-SPD coalition government will face numerous domestic issues, primarily related to migration and a shrinking economy, which is heading toward recession for the third consecutive year. With Russia’s ongoing war in Ukraine and Trump’s trade war, challenges are likely to increase for the next government. However, Merz appears optimistic about his ability to restore Germany’s prominence, which is essential for the country at this time. To that end, the Indo-Pacific appears to be a foreign policy priority for the incoming government, which should yield positive results if the policy guidelines are implemented effectively.
