Officially Inaugurated After Receiving Presidential Appointment... Energy Price Rise as Economic Variable
To Lower It, Nord Stream 2 Operation Needed... Deepening Dilemma Between Practicality and Eco-Friendliness
[Asia Economy Reporter Byunghee Park] Following Angela Merkel of the center-right Christian Democratic Union (CDU), Olaf Scholz of the center-left Social Democratic Party (SPD) officially took office as the head of Germany's coalition government on the 8th (local time), marking the first center-left chancellor in 16 years.
His first domestic challenge is responding to the unprecedented spread of COVID-19. Externally, the approval of the Nord Stream 2 gas pipeline connecting Germany and Russia is expected to be a key issue. The Nord Stream 2 pipeline, which will serve as a gateway supplying Russian natural gas to European countries including Germany, was completed last September, but Germany has yet to approve its use due to international public opinion against Russia.
According to Bloomberg News, Chancellor Scholz took the oath of office at the Federal Parliament after receiving his appointment certificate from President Frank-Walter Steinmeier on the same day. His term officially begins the moment he is appointed by the president.
Immediately after taking the oath, Scholz did not clarify his position on Nord Stream 2 in an interview with German public broadcaster ZDF. Recently, with forecasts that Russia may invade Ukraine early next year, international opinion against Russia is unfavorable.
Scholz stated, "If Russia invades Ukraine, the international community will respond," targeting Russian President Vladimir Putin. However, when asked whether suspending Nord Stream 2 operations could be part of the response, he avoided giving a specific answer, the news agency reported.
Scholz is under both domestic and international pressure regarding the Nord Stream 2 pipeline. The United States is pressuring Germany to halt Nord Stream 2 operations if Russia invades Ukraine.
Within the coalition government, the Green Party is exerting strong pressure. The Greens, who advocate environmentalism as their political ideology, oppose the operation of Nord Stream 2 due to environmental destruction concerns. They also advocate a tough stance against Russia citing human rights issues. Coincidentally, the Green Party co-leaders Annalena Baerbock and Robert Habeck have taken the posts of Foreign Minister and Environment Minister, respectively, in the Scholz government.
Former Chancellor Merkel pushed forward with the completion of Nord Stream 2 for economic benefits despite international criticism. Even when Russia faced international condemnation over the crackdown on opposition leader Alexei Navalny this year, Merkel refrained from criticizing Russia.
With the spread of the Omicron variant and rising energy prices emerging as variables for the German economy, operating Nord Stream 2 is necessary to lower energy costs. However, Scholz faces many hurdles before he can take the same stance as his predecessor Merkel. His dilemma between economic pragmatism and diplomatic and environmental policy ideology is expected to deepen.
At the handover ceremony held at the Chancellor’s Office after Scholz’s inauguration, former Chancellor Merkel said, "Take charge of the Chancellor’s Office and do your best for our country," adding, "That is my wish. I wish you good luck." Scholz responded, "I want to express my deep gratitude for the hard work over the past 16 years. It was an extraordinary era," and added, "I will carry on the spirit of East Germany. Not much will change."
With Scholz’s inauguration, the 17-member German cabinet also officially launched after receiving appointment certificates from the president. Scholz appointed women as the first female Interior Minister and Foreign Minister in German history, and entrusted the Defense Minister position to a woman as well, forming a gender-balanced cabinet with eight women and eight men excluding himself.
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