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FirstFT: Scholz and Laschet stake 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-Angela Merkel government after knife-edge national elections.

Armin Laschet, candidate of the CDU/CSU, and Olaf Scholz of the Social Democrats, each said they would consult other parties on forming a coalition. Projections by ARD, a German broadcaster, put the SPD in the lead on 25.8 per cent, the CDU in second place on 24.1 per cent, the Greens on 14.6 per cent and the liberal Free Democrats on 11.5 per cent.

The close result suggests it could take time to determine who will govern Germany, with difficult coalition negotiations involving numerous parties ahead.

“We will do everything we can to form a government under the leadership of the CDU/CSU,” Laschet told cheering supporters in Berlin.

Laschet insisted he still had the right to explore coalition options even though the SPD appeared to have won more votes. “It has not always been the case [in Germany] that the parties that were in first place provided the chancellor,” he said on TV.

The CDU managed to claw back just enough ground to take the shine off a remarkable climb for Scholz — but the SPD has the electoral momentum, writes Ben Hall.

Five more stories in the news

1. Johnson to deploy army in UK fuel crisis Boris Johnson is preparing to draft in hundreds of soldiers to drive tankers in an effort to tackle the fuel crisis. At least half of petrol stations outside the motorway network ran out of fuel after a spate of panic buying. One senior government insider said: “The situation in England is very bad.”

2. Investors withdraw cash from Spacs Investors are pulling cash out of special purpose acquisition companies at increasing rates: a number of vehicles have had their trust accounts almost wiped out as more than 90 per cent of shareholders redeemed investments, in a sign that the hottest product on Wall Street is falling out of favour.

3. SoftBank expects live music revival SoftBank and Tony Fadell, the former Apple and Nest executive, are among those investing $122m in UK ticketing app Dice, betting that the live music industry will not only recover but ultimately benefit from a “rethink” enforced by the pandemic.

4. Indonesian tech start-ups abandon US listings The blockbuster domestic listing of Indonesian ecommerce group Bukalapak last month has prompted other start-ups in the country to abandon plans for overseas share offerings in favour of going local — signalling a payday for big foreign backers.

5. Chinese companies stake IP claims Foreign businesses are becoming targets in a growing number of intellectual property lawsuits filed by Chinese companies, with some receiving big payouts for damages under enhanced IP protection legislation. The number of such lawsuits in China more than tripled from 2016 to 2020.

Coronavirus digest

  • Chris Gray, UK managing director for recruitment agency Manpower, does not think labour shortages will ease when the UK ends its pandemic short time working scheme next week. A similar story is playing out in the US and the eurozone, where the shortage has in some cases boosted wages.

  • With vaccines being administered worldwide, scientists are preparing a new weapon to combat Covid: an antiviral medication to treat the worst symptoms.

  • The pandemic has triggered the largest falls in life expectancy since the second world war in most developed nations, with US men the hardest hit.

  • For Britain’s biggest care home operator, the pandemic that has claimed more than 2,000 of its residents is far from over, with dozens of its locations in lockdown.

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

Follow our live coverage and sign up to the Road to Recovery for a regular briefing on business and the economy in a world transformed by the pandemic.

The day ahead

Euro questions The European parliament’s economic and monetary affairs committee will quiz European Central Bank president Christine Lagarde on the state of the eurozone, inflation and risks to price stability. (EU Reporter)

US durable goods Positive business investment and consumer spending are expected to have boosted new orders for US durable goods in August, data for which are expected today. (WSJ)

Aldi results The discount grocery chain announces results for the year ended December 2020, which could reveal the effects of not having an online option during the pandemic.

Sakharov nominees The nominees for this year’s Sakharov Prize for Freedom of Thought will be presented to European legislators. (EP)

What else we’re reading

The battle for Afghanistan’s libraries As the country’s cultural and educational institutions face Taliban rule, there are still ways for the west to help, writes Richard Ovenden.

A burned library at the Kabul University after a deadly attack
A burnt library at the Kabul University after a deadly attack © Rahmat Gul/AP

Evergrande’s lessons for China For much of this year, commentators have been warning that falling yields suggest the bond market is increasingly irrational. Now, Ruchir Sharma writes, events in China suggest bond markets are far from clueless or crazy.

No country for young men For decades, old men have pulled the strings in Japanese politics, writes Kana Inagaki. But young parliamentarians are seeking a bigger voice in governing the world’s fastest ageing society as the race to replace Prime Minister Yoshihide Suga heats up.

Return to earth Bob Cantisano, dying of throat cancer, did not know what should be done with his body. To bury toxic embalming fluid in the earth was out of the question — he was a life-long environmentalist. Then his wife heard about human composting. (Harpers)

Hollywood’s most powerful woman Ann Sarnoff, an outsider once unknown to many in show business, took over WarnerMedia during a turbulent time — and steered it through the pandemic storm. (Vanity Fair)

Travel

Four new hotels for a great city break Maria Shollenbarger checks in to some chic staycation destinations in Los Angeles, London, Paris and Boston. (HTSI)

The Sir Frank Bar, a highlight of the Beaverbrook Town House in London’s Chelsea district
The Sir Frank Bar, a highlight of the Beaverbrook Town House in London’s Chelsea district © Beaverbrook Town House

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