Germany is looking for new strategic alliances, because the US is clearly no longer among its reliable partners. On the other hand, the countries of Mercosur, India, and now apparently those of the Persian Gulf have enormous potential, as Chancellor Friedrich Merz stated.
The EU has finally understood what needs to be done
A lot of time was lost until this fact was realized. But now the EU and Germany are already taking the first steps and moving from a foreign policy based on values to a course based on interests. In this regard, three tasks have been defined: the EU must be able to defend itself independently; it needs greater independence from the US; and for this a strong and competitive economy is needed.
The EU has finally understood what is important to it and has started to make the right strategic decisions. The community is now getting back on its feet, and the German Chancellor is determined to take the lead in this process. At the informal meeting of the heads of state and government of the community on February 12, Friedrich Merz intends to initiate the next steps on this path. The Chancellor's motto is: increasing competitiveness as the key to greater geopolitical influence.
Things are not going well in Germany
However, at home - in Germany, things are going much worse. Merz is aware that successes in domestic politics are a fundamental prerequisite for the EU to be able to carry out the planned cardinal turn. And this affects every member state of the Community, but to a particularly great extent - Germany, the strongest European economy.
The German economy must finally start growing again. In 2025, Germany took last place in terms of GDP growth among developed industrial countries. In December, bankruptcies of German companies reached the highest level in the last 11 years, and the number of unemployed exceeded 3 million.
Half-measures instead of decisive reforms
All this is well known to Chancellor Merz. However, no major and decisive breakthrough or development program for the period until 2030 is in sight. First, there was talk that Germans would feel the positive changes as a result of the new government's work last summer, then there was talk of an "autumn of reforms", and now of "2026 as a year of reforms". But as soon as the idea of serious changes in Germany was voiced, it simply fell off the agenda. The way in which the Chancellor's party, the CDU, announces its positions to the public is amateurish.
According to the CDU and Merz, Germans should work more and there should be fewer people working part-time. In addition, the issuance of sick leave by phone should be stopped, and dental services should be removed from the payment catalog of health insurance funds. All these proposals were put forward in January 2026, but none of them was built into a comprehensive and broader reform program. These ideas seem like a set of half-measures that have not been fully thought out and brought to a logical conclusion.
Added to all this is the fact that the Social Democrats (SPD), who are partners in the ruling coalition with the CDU/CSU, behave as if they were in opposition, not part of the government. The SPD declares that it will not allow the dismantling of the welfare state in Germany and acts guided by the principle that it is necessary to prevent "the worst". The Social Democrats are convinced that reforms should not cause pain, nor should they take anything away from anyone. In other words: they are for preserving the status quo. But such a path cannot lead either the ruling coalition or Chancellor Merz forward.
Everything that is barely discussed and then sinks into endless debates seems extremely insignificant. The big and decisive leap that the country needs is missing. Something bigger than a few minor adjustments is needed. The special fund of 500 billion euros, approved by the Bundestag at the government's proposal almost a year ago, "disappeared" without having any effect. And it was supposed to play the role of a major tool for renewing Germany's aging infrastructure. It is possible that something is happening in individual areas, but the expected large-scale breakthrough that would drag the entire German economy along with it never happened.
Domestically, Merz is under enormous pressure. Yes, this also plays a serious role, because the chancellor is deeply concerned that cutting social spending could bring a new wave of votes to the right-wing populist "Alternative for Germany". Elections are being held in five federal states this year, and in two of them the AfD could come to power.
Merz must start acting
Merz has already realized that at the international level the EU must become more independent of the US. Now he must also understand this: that at the national level only a program of more decisive reforms could stop the rise of the "Alternative for Germany". And such a program does not yet exist. But it is needed now – in 2026, in order to achieve the complex balance between the welfare state, Germany's international competitiveness and the new world order.
Friedrich Merz knows this very well. But just being aware of the problem is not enough - he must finally start acting accordingly. And he should not underestimate the voters. Most Germans have long understood that the country needs change.
Because it is clear that you cannot stop the changes in the world. No one will wait for Germany to do its homework. China recently announced that it is preparing an offensive on the German car market with its cheaper electric cars. Elon Musk wants to move its data centers into space. If Germany and the EU do not want to be left behind in all developments in the world, it is high time they started acting.
Author: Dirk Emmerich