Economy

On Wednesday (9 April) a new coalition government was announced in Germany bringing back a CDU chancellor working with the centre-left SPD as junior partners. It is an arrangement that Germans are familiar with. Many post-war German governments were similarly constituted, and the German people are comfortable with this arrangement. It buries the prospect of the far-right Alternative fur Deutschland  (AfD), which came second in recent elections, having a role in government. The 146 pages coalition agreement was hammered out in a relatively short time, with those negotiating fully aware of the urgency of giving the country a stable government at a time of global uncertainty and serious domestic challenges. “Germany is back on track” announced the Chancellor-designate, Friedrich Merz, who is expected to take office in early May. Europeans should be happy. A strong Germany is the backbone of Europe, and the new coalition is the best guarantee of that.

The EU on Wednesday adopted its first measures hitting back at President Donald Trump’s tariff onslaught, targeting more than 20 billion euros of US goods including soybeans, motorcycles and beauty products. The levies of up to 25 per cent are retaliation for US duties on steel and aluminium imposed last month - with Europe's response to Trump's latest tariffs salvo yet to be announced.