Written by: Alexandra Sima, EST Ambassador to Romania

Edited by: Stefano Bates

For decades, Germany has reigned as Europe’s uncontested powerhouse, but today, that dominance is in peril. Once the engine of the European Union (EU), Germany now finds itself trapped in stagnation–its economy faltering, its leadership in question, its influence waning. And as Berlin falters, Paris advances. Emmanuel Macron, ever the strategist, seizes this window of time to configure Europe in France’s image. With bold ambitions and a defiant vision of European autonomy, he is positioning France to seize the bloc’s reins of power.

The accelerating tensions have led to a crucial question: could France replace Germany as Europe’s eminence grise? As Europe approaches a pivotal juncture, the shifting dynamic between the two nations may well chart a new course for the EU–and redefine its role in the emerging global order. This article examines the economic, political, and strategic challenges facing both countries, exploring whether France possesses the capability to challenge the once uncontested nation leading the bloc or if it can recover and reclaim its pre-eminence. 

The Sick Man of Europe: Germany’s Struggle to Hold Its Ground

Germany, formerly the architect of Europe’s economic might and political stability, is now on the allegorical ropes. The nation’s famed manufacturing sector is confronted with mounting domestic pressure from energy crises and concerns of deindustrialisation, while political paralysis has left Berlin rudderless. At the same time, an aging population and a shrinking workforce threaten long-term stability. On the global stage, Germany’s influence is diminishing, caught between economic dependence with China, and almost vassalised by the United States. As these challenges aggregate, the question looms: can Germany reclaim its leadership, or is Europe’s former strongman backsliding into its sick man –a title it bore during past periods of economic stagnation or uncertainty?

Germany’s economic strength has long been underpinned by its manufacturing industry, but that foundation is increasingly fractured. The energy crisis delivered a significant toll on Germany’s  industry, driving up costs and forcing companies to downsize production. Energy-intensive sectors such as chemical, metallurgical, and glass manufacturing, which have siphoned over three-quarters of industrial energy in 2021, have also struggled to recover since their sharp downturn in early 2022. Even as gas prices plummeted in late 2023, industrial production remained scarred, 13% below pre-crisis levels, signaling rooted structural issues (Benecká, S. 2024). 

The country’s automotive industry–once the crown jewel of its economy–is now at a crossroads. The transition from combustion engines to electric vehicles (EVs) has proven more difficult than anticipated. The abrupt rescindment of EV subsidies in December 2023 has created a wave of uncertainty for manufacturers. While high energy costs, and excessive bureaucracy have resulted in outcompeted productive capacity. German automakers have been leaden-footed to adapt, falling short in EV innovation, and experiencing shrinking profit margins (Kaufmann, D. 2025).

Under Chancellor Olaf Scholz, Germany has experienced significant political paralysis, driven by profound divisions within his coalition government. The Social Democrats (SPD), Greens, and the Free Democrats (FDP) frequently clash over elemental issues, particularly vis-a-vis energy policy, economic reforms, and climate action (McGuinness, D. 2024). Unlike Angela Merkel’s era, marked by decisive leadership and stability, Scholz’s government has struggled to reach consensus on vital decisions, leading to delays and inertia. This internal dysfunction has compromised Germany’s capacity to respond effectively, both to domestic challenges and shifting global dynamics, thus leaving the country vulnerable. 

Nevertheless, Germany’s political climate has recently experienced a momentous realignment. In the most recent federal elections, Friedrich Merz and the Christian Democratic Union (CDU) secured a decisive victory, ushering in a governance model that blends social conservatism with market-oriented economic policies. With a platform centered on revitalising Germany’s industrial base, reducing regulatory burdens, and strengthening fiscal discipline, Merz seeks to reassert Germany’s leadership within the EU (Politico, 2025). His ascent to power  signals a departure from Scholz’s coalition-led approach, and he introduces a manifest counterweight to Macron’s vision for a more centralised Europe, led by La République Française.

Germany’s economic dependence on China remains noteworthy, with bilateral trade reaching €254.2 billion in 2023, making China Germany’s premier trading partner for the eighth consecutive year. Crucial exports, including vehicles (€25.7B), machinery (€22B), and electrical equipment (€20.3B), highlight the far-reaching ties between them (Trading Economics, 2025). German firms, like Volkswagen and BASF, continue to make substantial investments. BASF, a global leader in chemicals and industrial materials, is planning to invest$10.7 billion in China by 2030, strengthening its foothold in the world’s manufacturing hub (Benoit, B. & Wilmot, S. 2024).

While Germany navigates these setbacks, another player is seeking to capitalise on the moment: France.

Paris in the Spotlight: The Vanguard of a New Europe

With Germany in dire straits, France is positioning itself to take the lead in shaping Europe’s future. President Emmanuel Macron has outlined his vision for an empowered, more independent EU–one that is neither reliant on the U.S. security umbrella, nor China for industry, and nor Germany for leadership. His drive for strategic autonomy, along with efforts to spur Europe’s defense, industry, and technology sectors, suggest a shift in power dynamics. Paris is presenting its case as the new epicentre of European leadership.

Macron’s advocacy for European strategic autonomy is underpinned by Europe’s axiom, to achieve greater self-reliance, ergo reduce its exposure to external predation. His initiatives, such as the Strategic Compass and the European Defense Fund, aim to harmonise defense capabilities and drive technological advancements (Ministère de l’Europe et des Affaires étrangères, 2022). In his pan-European industrial strategy, the French President’s emphasis on a competitive defense economy and secure supply chains, underscores the need for the continent’s nations to fortify their industrial bases (Dempsey, J. 2024). Technologically, Macron advocates for significant investment in areas such as cybersecurity, space operations, and digital infrastructure, thereby positioning Europe to meet contemporary and future challenges (Perissisch, R. 2022). This vision highlights France’s ambition to lead Europe toward a more autonomous and resilient future. 

France’s unique strengths bolster its global influence. Its nuclear energy independence, meeting over 50% of its energy needs, is a significant asset, particularly amid geopolitical uncertainties (Orano, 2023). This energy security enhances France’s strategic  autonomy. Additionally, its formidable military, backed by one of the world’s largest defense budgets, translates into robust power projection capabilities (Nash, F. 2024). As a permanent member of the United Nations Security Council (UNSC), France holds veto power, empowering it to wield significant sway in international security decisions (Ministère de l’Europe et des Affaires étrangères. 2021). 

Macron’s economic strategy prioritises state-driven policies and investment in cutting-edge technology and green industries, thereby strengthening Europe’s autonomy. He champions noteable funding in transformative strategic sectors such as A.I., quantum computing, space, biotechnology, and renewable energy sources–hydrogen and nuclear power. France 2030, a €30 billion investment plan, strives to stimulate economic growth through diverse projects including the commission of small nuclear reactors, electric vehicles, and greener commercial aviation (Corbet, S. 2021). This blueprint also promotes greater financial integration across Europe, funnelling investments into determined strategic sectors.

Beyond economic initiatives, Macron’s ambitions extend to diplomacy, where he seeks to redefine France’s global role. On the diplomatic stage, Macron is actively working  to mediate global conflicts and establish France as a key geopolitical force. He has engaged in efforts to de-escalate the Russo-Ukrainian war, advancing the notion of diplomatic resolutions (Boston Global Forum, 2024). Moreover, he endorses expanding the UNSC to include increasingly relevant countries. For instance, India, Germany, Japan, and Brazil, and two African representatives, to establish a more inclusive and effective UN (ANI, 2025). Additionally, Macron has initiated the Paris Peace Forum to encourage collective governance in addressing global challenges (Boston Global Forum, 2024).

The Fiscal Divide:  A Tale of Two Nations

France, however, faces considerable obstacles on its path to European leadership, stemming from economic, political, and international challenges. 

In economic terms, France grapples with soaring public debt, presently around 115% of the Gross National Product (GNP)–significantly exceeding the 100% level inherited by the extant President. Its industrial base remains weaker than Germany’s, which has long been Europe’s economic engine. While France has made strides in attracting foreign direct investment, its small and medium-sized enterprise (SME) sector remains underdeveloped compared to Germany’s deeply entrenched industrial ecosystem (Cole, A. 2022).

Politically, France is navigating a period of profound instability. Recent elections have revealed a fractured political landscape, wherein both far-right and far-left parties are gaining traction (Wendling, N. 2024). Macron’s administration is facing compounding challenges, culminating in a no-confidence motion, leading to the government’s collapse in December 2024 (Ataman, J. 2024). Growing populist sentiment, fueled by economic discontent and cultural divisions, continues to disrupt governance  (Wendling, N. 2024). Protests and strikes have become frequent, signaling widespread dissatisfaction with the status quo. 

On the international stage, France’s advances to attain the prize of EU leadership encounter resistance from member states wary of greater centralised power. Eastern and Northern European countries, in particular, favour a more equitable distribution of influence, questioning whether France’s domestic struggles undermine its leadership’s efficacy (Ataman, J. 2024).

On a different note, despite its current economic turbulence, Germany retains potential to reassert its dominance. Although it is facing industrial and economic headwinds, Germany’s multi-faceted industrial strength and financial resilience could enable a swift resurgence. Consequently, shifting the balance of power back in Berlin’s favour. 

At its core, France’s bid for European leadership is challenged by economic burdens, political volatility, and international skepticism. While opportunities exist, overcoming these obstacles will prove crucial to make certain its lasting influence within Europe.  

The Winds of Change: L’Europe de Demain

The winds of change are sweeping through Europe, reshaping EU priorities and redefining key relationships. These shifts unfold against a backdrop of tectonic geopolitical realities and internal economic challenges. 

The EU is undergoing a profound zeitenwende, defined as watershed (DGAP, 2022), marked by a turn towards more interventionist economic policies and an intensified focus on a native, autarkic defense-industrial architecture. This evolution derives from the need to address economic disparities and lessen dependence on external powers, chiefly vis a vis the U.S., for security guarantees. President Macron has been a leading voice for an independent European defense framework, seeking to drive the EU’s strategic autonomy (Engberg, K. 2021). His actions are not merely a reaction to shifting global dynamics, but calculated to ensure Europe can safeguard its interest without NATO’s netting. 

Macron’s vision for an independent European defense reflects a broader ambition to reduce U.S. influence in European affairs. This shift acknowledges that Washington’s priorities  align imperfectly with Europe’s, particularly as transatlantic relations grow more varicoloured  (Engberg, K. 2021).  A European defense union is seen as a means to solidify the bloc’s position on the global stage, and enhance its ability to manage security threats without dependence on American hard power. 

The drive for defense autonomy and economic interventionism raises critical questions regarding future Franco-German relations. Historically, they have formed the bedrock of European integration, yet tensions over defense, energy, and economic policies have frayed this partnership (Sîmpălean, P. 2024). The key question is whether Germany will acquiesce to a secondary role in this new European order. 

Germany’s economic struggles, including deindustrialisation and signs of economic decline (AP News, 2023), may shape its willingness to cede leadership to France. However, given its robust industrial base and historical economic strength, Germany is unlikely to accept a diminished role without resistance (20countries. 2024). Recent collaboration between Germany and Italy on defense initiatives, hints at the emergence of alternative alliances within Europe, furthering the complexity of Franco-German dynamics. 

Conclusion

To surmise, Europe stands on the brink of a new epoch. Once the unshakable pillar of the EU, Germany now finds itself weakened–its economy faltering, its leadership divided, its influence waning. Meanwhile, France, under Emmanuel Macron’s ambitious vision, seeks to seize the moment, reshaping Europe in its own image through strategic autonomy, military investment, and economic revitalisation. Yet, France’s path to dominance is far from certain. Political unrest, economic vulnerabilities, and resistance from wary EU partners cast doubt on its ability to assume the mantle of leadership. 

The battle for Europe’s future is not solely a contest of national power but a defining struggle over the continent’s identity. With newly-elected Friedrich Merz at the helm, Germany promises to once again claw back its regional primacy, while France strives to chart a new course for the EU. As tensions mount and global frictions grow, Europe’s ability to navigate these upheavals will determine its place in the revised world order. Whether this moment marks the rise of a new leader or the deepening of Europe’s divisions remains to be seen–whichever the outcome, one should rest assured it will shape the region for generations to come.

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