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FirstFT: Knife-edge election produces rival claims to lead Germany

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The leaders of Germany’s two main parties both claimed to have won a mandate to form the country’s first post-Merkel government, after knife-edge national elections that failed to deliver a clear winner.

Armin Laschet, candidate of the conservative CDU/CSU, and Olaf Scholz of the Social Democrats each said they would consult other parties on forming a coalition.

Projections by Germany’s ARD broadcaster put the centre-left SPD in the lead on 25.7 per cent, with the Christian Democrats in second place on 24.5 per cent, the Greens on 14.3 per cent and the liberal Free Democrats, or FDP, on 11.5 per cent.

The exceptionally close result suggests it could take time to determine who will govern Germany after Angela Merkel steps down as chancellor after 16 years, with difficult coalition negotiations lying ahead.

“We are still in a phase of three-dimensional chess . . . It’s impossible to tell where this evening is going. There are even more possibilities than had widely been anticipated just a few days earlier,” said Christian Martin, a political scientist at the University of Kiel.

Sunday’s Bundestag election was the first in Germany’s postwar history when an incumbent chancellor was not standing for re-election, making the race one of the most volatile and unpredictable in living memory. The SPD, CDU/CSU and Greens have seen 10-point swings in their poll ratings since the start of the year.

Read more:

  • Laschet claws back ground: The centre-right CDU/CSU may have crashed to a historic election defeat but its candidate for German chancellor still managed to take the shine off the performance of the SPD, writes Ben Hall.

  • FT View: Germans may crave the stability of a Merkel substitute, but they also need their next government to fix the problems she is leaving behind, not just manage crises.

  • What investors want: The new government in Berlin needs to raise public investment and fund the transition to a greener future, says the group chief economist at UniCredit.

  • Pledges made: Parties that have made starkly different promises to German voters will be forced to build some kind of consensus, with coalition talks likely to drag on for weeks — or even months.

  • ‘Wave citizens’ vote: Some of the 1m refugees admitted to Germany by Merkel in the 2015 migrant crisis cast their votes as they took part in the country’s first elections since becoming citizens.

Thanks for reading and here’s the rest of today’s news — Michael.

Five more stories in the news

1. Cities seize Evergrande presales At least two local governments in China have taken control of sales revenue from properties owned by the world’s most indebted property developer, even as Beijing remained silent about the unfolding liquidity crisis at Evergrande.

2. Scramble to save Joe Biden’s plan Democrats are gearing up for a week of “intensity” on Capitol Hill as they struggle to iron out their differences and salvage the US president’s legislative agenda while staving off a government shutdown.

3. French seek submarine redress Naval Group, the defence contractor at the heart of the diplomatic crisis over the new “Aukus” strategic pact, has vowed to claw back tens of millions of dollars from Australia for a cancelled A$90bn ($65.4bn) submarine contract.

4. Frictions remain after Meng Wanzhou release The presumed heir of Chinese technology giant Huawei returned home to nationalist fanfare after almost three years fighting US extradition charges from Vancouver. But experts warn of more “uncomfortable” compromises to come to improve US-China relations.

5. Airbus pins hopes on hydro jet The European aircraft maker’s chief executive says it is ready to start building a hydrogen-powered commercial airliner before the end of the decade. Airbus is confident that 2035 is a “fair and realistic perspective” for a hydrogen plane to enter service.

Coronavirus digest

  • Governments may need to intervene to “restore order” to a global logistics market hit by chronic delays, supply chain disruption and record container rates, warns the head of one of Asia’s biggest ocean shipping companies.

  • The number of Americans suffering serious adverse health effects after consuming ivermectin to treat Covid-19 has more than doubled since the anti-parasitic drug was falsely touted as a cure for the virus.

  • Companies in Vietnam have warned that a prolonged lockdown puts at risk the country’s status as a manufacturing hub.

  • Rochelle Walensky, director of the Centers for Disease Control and Prevention, says US children should be able to go trick or treating this Halloween, especially if they are outdoors. (CNBC)

  • US retailers are racing to staff up for the holiday season as the number of unfilled jobs rises, despite offering wage increases and starting bonuses in a bid to tackle a labour shortage.

Line chart of Average hourly earnings ($) showing US retail wages have climbed through the pandemic

The day ahead

Infrastructure vote Monday brings a key moment for Joe Biden’s $1tn infrastructure bill as it is the deadline for the House of Representatives to vote on the bipartisan legislation to lift the US economy.

Low-cost boost EasyJet is due to announce the result of its surprise rights issue. Investors would like to know what the UK-based budget airline is doing with the money. Meanwhile, the cargo delivery service FedEx holds its annual meeting.

Governor’s speech The head of the Bank of England, Andrew Bailey, addresses the Society of Professional Economists. And the UK central bank issues monthly statistics for capital issuance. IHS Markit will also reveal the latest UK quarterly data from its Scottish Widows Household Finance index.

What else we’re reading

The BlackBerry and me The near-extinct device never achieved what vinyl did in music or Blu-ray did in film — a large enough cult of fans to withstand the march of tastes and invention. But it stood for what will come to be seen as the golden age of the internet, says our columnist Janan Ganesh.

‘I have a lot of questions for you’ FT Weekend Magazine brought together the reclusive Italian novelist Elena Ferrante and performance artist Marina Abramovic to discuss art, writing and more, on the occasion of Abramovic’s new London exhibition.

Marina Abramović
Marina Abramovic © Juno Calypso

Is it time to avoid investing in China? I cannot remember a time when the issue about investing in the country was dominated by unpredictable politics and governance as it is now, writes author George Magnus.

Joe Manchin’s threat to Biden’s spending spree In both the White House and Congress, Democrats’ frustration with the US senator from West Virginia is rising. But for residents of Marion County, the small rural coal mining community from which Manchin hails, the Senate’s most conservative Democrat is a common sense bulwark against partisanship and overspending. Our reporter Obey Manayiti spoke to local voters

Business book of the year 2021 The challenges of climate change, racial discrimination and cyber crime feature on the shortlist for this year’s Financial Times and McKinsey Business Book of the Year Award. Andrew Hill, management editor, runs through the six finalists. The winner of the award will be announced on December 1.

Travel

Houston will soon be the third-largest city in the US. Gary Tinterow, director of Houston’s Museum of Fine Arts, shares his favourite places to eat, drink, enjoy the arts and have fun in the port city. A winter highlight he never misses is the Houston Livestock Show and Rodeo.

Houston Livestock Show
The Houston Livestock Show and Rodeo: where else can you eat fried Oreos? © Mark Felix/Getty

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