Free Democratic Party FDP leader Christian Lindner leaves a news conference in Berlin. Photo: Reuters/Stefanie Loos

After winning only 33% in Sunday’s election, down from 41.5% in 2013, Angela Merkel is now beginning the delicate process of trying to form the only viable coalition – one between her CDU/CSU and the FDP and Greens. If she fails it could mean her political demise, a realization that gives huge power to both the FDP and Green parties, both of which would lose far less by walking away from the table.

As Wolfgang Munchau writes for the Financial Times, the FDP could extract a heavy price, and will likely doom French President Emanuel Macron’s ambitious euro zone integration agenda:

The FDP is probably the only Eurosceptic party in Europe that does not recognise itself as Eurosceptic. Its leader, Christian Lindner, keeps on emphasising his party’s pro-European roots. Yet he wants Greece kicked out of the eurozone and favours no further programmes by the European Stability Mechanism, the rescue fund for the eurozone. Indeed, he wants the ESM to be phased out altogether in the long run, and he rejects the proposal of Emmanuel Macron, France’s president, for a common eurozone budget. Mr Lindner said on Sunday that the latter would be his party’s red line in the coalition talks.

Asia Times Financial is now live. Linking accurate news, insightful analysis and local knowledge with the ATF China Bond 50 Index, the world's first benchmark cross sector Chinese Bond Indices. Read ATF now.