The new federal government was confronted with various crises after it took up office: the Russian war of aggression on Ukraine, the crisis in gas and energy supply, the inflation driven by it and the ongoing pandemic. In addition to acute crisis management, the federal government has set about implementing the agreements reached in the coalition agreement between the SPD, the Greens and the FPD. In particular, the focus is on the major transformation tasks.
The Russian War of Aggression on Ukraine Led to a Paradigm Shift in German Energy Policy
In addition to the targeted implementation of Germany’s climate protection goals, the focus shifted more strongly to energy security. This included various measures to diversify the supply of fossil energies and thus reduce dependencies on Russia and in some cases end them altogether. There was also a focus on securing energy supplies for the coming winter, with particular attention being paid to the gas market and gas storage facilities. Finally, various legislative amendments created incentives for the accelerated expansion of renewable energies and thus for progress in energy independence.
The crisis affects key fiscal policy decisions of the federal government
The current inflation rate in Germany is 7.6 percent. One focus of fiscal policy over the past six months has therefore been to hold back persistent inflation as best as possible while at the same time providing effective relief for citizens due to rising living and energy costs. Likewise, the draft budget for 2023 was approved by the federal cabinet – it envisages significantly reduced net borrowing, thus ensuring compliance with the debt brake again next year. In the interest of the performance of German capital markets in shaping the digital transformation and the transformation towards climate neutrality, the first key points of a new Future Financing Act were also presented.
Transformation and crisis management remain the greatest challenges
In the next six months, the focus will be on continuing to overcome the current crises and on shaping transformation.
In our detailed overview, which you can download by clicking below, we provide deeper insights into the most important political achievements in the areas of energy and finance over the past six months. We also rank what’s coming up in the next six months and what to expect politically. One thing is clear: crisis management and transformation tasks will be with us politically for a long time to come.
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Dr. Thies Clausen
Head of Corporate & Public Affairs