2021-08-24-牛津经济研究院-Germany_Push_for_carbon_neutrality_to_get_limited_fiscal_support_6页_445kb

Context: The upcoming elections in Germany are pivotal due to the potential succession of Chancellor Angela Merkel. The race is open, with various coalitions likely, but changes are limited by current political structures and voter preferences.

Key Challenges: Achieving carbon neutrality and addressing climate change face hurdles, with fiscal support for green investments being modest. Demographic issues and current account surpluses are unlikely to be forcefully tackled.

Political Dynamics: A tri-party coalition is probable to succeed the current ruling parties, blending center-left and center-right views. Voter priorities have shifted toward environmental concerns, but this hasn't significantly boosted support for any single party, leading to a reactive policy approach.

Policy Approaches: Climate neutrality targets vary by party—Greens propose ambitious goals, while others rely on market mechanisms. Fiscal policy debates center on debt-financed investments versus balanced budgets and tax cuts, with the debt brake constitutional limit limiting major reforms. EU fiscal integration and growth-friendly rules are contested.

Outcomes: Germany's policy trajectory remains gradual and consensus-driven, with limited chance for transformative changes. Economic growth is supported by existing fiscal measures, but green investments may face implementation delays due to capacity constraints and uncertainties in coalition negotiations.