Challenges for Europe's Economic Core: Germany

Editor's Note: This is the first installment of a series on domestic political challenges facing Germany, France and the Netherlands. These countries, which make up the geographic and economic core of the eurozone, have united to press for austerity in the currency bloc, backing financial assistance to struggling economies in exchange for agreements over tighter surveillance and control of national budgets. They have acted more or less together in the past two years, but in the coming months, domestic obstacles for each will weaken their unity.

Among the core economies of the eurozone, Germany is the most important member, but it — as well as France and the Netherlands, the other core countries — will face strong political challenges in the coming months. The signing of the European Union's fiscal compact and a decision on an increase of the bailout funds are of wider European importance and will show how strong Germany's coalition government is. While Berlin demands greater fiscal responsibility from other countries, support for such measures within Germany will be tested in regional elections.