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Ashoka Mody

Germany’s Economy Will Be Europe’s Problem

If people aren’t prospering, they won’t support integration.

No longer in the lead?

No longer in the lead?

Photographer: Thomas Niedermueller/Getty Images

The imminent end of German Chancellor Angela Merkel’s final term presents a great challenge for both her country and the entire European project. If her successor can’t pull the German economy out of its slide toward second-tier status, the union could lose its most important financial supporter.

Since Merkel’s announcement that she will not seek another term in 2021, the focus has been on whether her successor will be more willing to engage in the kind of risk-sharing needed to make the euro a viable currency — meaning a more complete banking union and more fiscal support for struggling member countries. Friedrich Merz, a leading contender to replace Merkel, has implied he might try, though he remains skeptical of “old French ideas” for financing deeper integration.