German election 2025: Five key issues next chancellor will have to face

Germany will head to the polls on Sunday after an unexpectedly short election campaign marked by a fierce debate on immigration, security, and a consistently poor economic outlook.

The leader of the largest opposition party, the centre-right Christian Democratic Union (CDU), Friedrich Merz, looks poised to be the country's next chancellor according to the latest polls.

With an estimated 30% of the vote to count on, Merz signalled he would be open to forming a coalition with incumbent Chancellor Olaf Scholz's Social Democrats (SPD) or the Greens.

Regardless of the victor, the person at the helm will face not only a changing foreign policy climate but a public at home worried about five key issues, according to a Gallup report seen by Euronews.

Deep dissatisfaction over living standards

Germans are now more unhappy about their living standards than at any other point since the 2008 financial crisis.

The percentage of Germans who said their financial situation was improving dropped sharply from 42% in 2023 to 27% in 2024, according to Gallup. Their dissatisfaction earns them a spot among the least optimistic about their standard of living in the European Union, together with Austria and Greece.

Their poor expectations align with expert forecasts for Germany's economy, which shrunk for the second year in a row in 2024. Germany, once an economic powerhouse, is projected to be the bloc's weakest performer in 2025.

Politicians from across the political spectrum have risen to the occasion to propose policies that could lift Germany out of its economic slump, including cutting excessive bureaucracy and lowering high electricity prices.

Housing crisis

Dissatisfaction with affordable housing has risen gradually for the past 15 years, with Germans evenly split being satisfied and dissatisfied with the availability of affordable housing in their local area for the first time since 2006.

Germans are not alone in Europe in becoming increasingly frustrated with a lack of affordable housing, however Gallup notes that the decline in satisfaction in Germany is particularly sharp — from 73% in 2010 to 47% in 2024.

The government is behind in its ambitious efforts to build 400,000 new affordable homes a year, straddled by high interest rates and construction costs. The problem is particularly acute in major cities — such as Berlin — where competition for homes has caused prices to skyrocket compared to a decade prior.

Hardened attitudes towards migrants

A string of attacks in which the suspect was an immigrant has pushed immigration to the forefront of Germany's election campaign.

Merz has attracted controversy by agreeing to work with the far-right Alternative for Germany (AfD) to introduce measures tightening migration policies through parliament. The majority of parties have, however, shifted to the right and promised tighter controls on immigration.

Their policies match the public's outlook, with Gallup finding that Germans' acceptance of migrants has fluctuated in recent years but fell in 2023.

Out of several major European economies, including France and Italy, Germany is the only country in which acceptance of migrants is significantly lower than it was in 2016 — a year after the government accepted thousands of asylum seekers.

Less faith in government

Although Germans' confidence in institutions like the military and the judicial system has been steady for the last few years, their trust in the national government has dropped to its lowest point in over a decade.

Germany consistently outranked the rest of Europe for faith in government. However, this year, the public's faith in government is no longer exceptional and is now split down the middle — reaching just 50% in 2024.

In contrast, confidence in former Chancellor Angela Merkel's government in her penultimate year as leader was 65%.

A decline in faith in government coincides with the collapse of Scholz's acrimonious three-party coalition — which fell apart in spectacular fashion in November after Scholz fired his Finance Minister Christian Lindner.

More leadership

The image of German leadership has taken a hit at home as well as among other Europeans, with a notable decline from a median of 60% to 54% in the past 12 months alone.

Slovenia, Norway, and Finland are particularly sceptical of Germany's leadership, with approval ratings dropping by at least 10% since 2023.

Merz has made a point of proposing to restore Germany's top position in the EU, telling a panel discussion on Saturday that he was "willing" to restore what allies have said was a lack of German leadership within the bloc.

"I'm seeing that Germany is in a strategic position at the centre of Europe, that so many things in Europe depends on Germany,” Merz said.