Germany's Coalition Collapse Amid Economic Woes and Global Shifts

Germany's economic challenges deepened as Chancellor Scholz's coalition collapsed following the firing of Finance Minister Lindner. The collapse raises uncertainty for the EU's biggest economy amid global tensions, including Trump's return and potential trade wars, impacting Germany's export-driven economy. Business leaders urge swift new elections for stability.

The collapse of Germany's ruling coalition, led by Chancellor Olaf Scholz, has plunged the country's economy into deeper uncertainty. Already grappling with economic woes from the pandemic, the war in Ukraine, and China's competitive edge, Scholz dismissed Finance Minister Christian Lindner, causing the coalition to lose its majority in parliament.

This political turmoil coincides with Donald Trump's imminent return to the presidency, raising fears of trade tensions with the U.S. and potentially impacting Germany's export-dependent economy. Trump has threatened tariffs that could hit German automakers, adding to the challenges posed by internal disagreements within the coalition.

As Scholz seeks a vote of confidence in January, business leaders and analysts alike call for prompt resolution and new elections to stabilize Germany's economic outlook. European leaders worry about the implications of a destabilized Germany as Trump's policies could alter established alliances and trade dynamics.

(With inputs from agencies.)