German Mittelstand entrepreneurs lose trust in Chancellor Friedrich Merz
Leaders of German Mittelstand companies say trust in Chancellor Friedrich Merz has been broken, one year after his coalition with the SPD took power on May 6, 2025. The unusually harsh judgment raises concerns about political and social stability in Germany. The Mittelstand, often described as the backbone of German capitalism, is a key barometer of business sentiment.
Leaders of German Mittelstand companies say trust in Chancellor Friedrich Merz has been broken, one year after his coalition with the Social Democratic Party (SPD) took power on May 6, 2025. The judgment, described as unusually harsh, raises concerns about political and social stability in Germany, according to interviews with business leaders.
The Mittelstand, often described as the backbone of German capitalism, is a key barometer of business sentiment. These companies are defined less by size than by the fact that the owner of the capital is directly involved in operational management. Their leaders are traditionally supporters of the Free Democratic Party (FDP), the Christian Democratic Union (CDU), and its Bavarian sister party, the Christian Social Union (CSU) — the two center-right parties represented by Merz.
The loss of trust reflects a broader concern about Germany's ability to forge consensus on reforms, which has long been a strength of the country's political and social model. The criticism comes as Merz faces mounting pressure from various quarters, including being booed at a DGB congress on May 12 over his reform plans.