Merkel averts German coalition crisis with migration deal

Bloomberg

German Chancellor Angela Merkel halted the immediate threat of a government breakup in Europe’s biggest economy, crafting a plan to tighten migration and keep her Bavarian sister party in the fold.
The euro and stocks rose after Merkel and Interior Minister Horst Seehofer, her antagonist who had threatened to resign, ended their two-week standoff. The compromise — which Merkel called “really good” — averts a split of the alliance that’s governed Germany for most of the time since World War II, but its success could well depend on factors beyond Merkel’s control and it may prove only to be a temporary solution.
“There are many questions that are open,” particularly because the migrant relocation plan accepted by Merkel to halt the dispute requires cooperation by Italy and Austria, Holger Schmieding, chief economist at Berenberg, said in a Bloomberg Television interview.
The deal between Merkel’s Christian Democratic Union and Bavaria’s ruling Christian Social Union also requires support from the Social Democratic Party, Merkel’s junior coalition partner. Merkel will try to get the SPD on board with the compromise at a meeting.
Ralf Stegner, a deputy SPD chairman, was scathing about the CDU-CSU dispute, saying it had caused “real damage” and “in the end only benefited right-wing populists.”
“The SPD is the only party doing professional government work at the moment, the others are entertaining the public with genuine hamming-it-up theater,” Stegner said with Deutschlandfunk radio. “It’s not as if we can just go back to daily business and everything is fine.”
Merkel and CSU leader Seehofer pulled back from the brink as they risked a coalition split that could have unraveled Merkel’s chancellorship after almost 13 years.
For the moment, the truce clears an obstacle that was eroding the chancellor’s authority at a time when her challenges include a trade conflict with US President Donald Trump, the UK’s exit from the European Union and rising populism across Europe. Merkel meets UK Prime Minister Theresa May and Hungary’s Viktor Orban on Thursday, before heading to a North Atlantic Treaty Organization summit with Trump next week in Brussels.
Merkel’s deal calls for setting up holding centers at the German border for refugees already registered in other EU countries. It’s meant to dovetail with a migration pact reached by the bloc’s leaders under pressure from the CSU, which includes pledges by some EU members to take back asylum seekers rejected by Germany.
Bavaria became a migration flashpoint during Europe’s refugee crisis in 2015 and 2016 as the main entry route to Germany. Gains by the populist Alternative for Germany have returned the topic to the CSU’s agenda ahead of a state election in October.
Infighting began after Seehofer pledged to send back asylum seekers at Germany’s border if they’re already registered in another EU country.