German socialist leader under growing pressure to resign and fix political chaos

  • Martin Schulz has stated repeatedly that the party wants to stay in opposition
  • German President Frank-Walter Steinmeier is currently pressuring the SPD to form a so-called Grand Coalition
  • Joe Kaeser, CEO of Siemens, said that Schulz was acting irresponsibly

The leader of Germany's socialist party is under heavy pressure to fix the country's political stalemate – despite the experienced lawmaker not being involved in recent coalition talks.

Martin Schulz of the Social Democratic Party (SPD) has stated repeatedly that the party wants to stay in opposition rather than joining another coalition, despite gaining 20.5 percent of the vote in September's election.

Leopold Traugott, policy analyst at Open Europe, told CNBC Friday that this "blunt rejection" has thrown up an issue for Schulz.

"If the SPD was to actually join a coalition again with the conservatives, this would make Schulz … a turncoat, because he said the opposite before, forcing him to resign," he added.

Talks to draw up a new executive in Germany between the pro-business FDP (Free Democratic Party), Chancellor Angela Merkel's CDU (Christian Democratic Union), its Bavarian sister party the Christian Social Union (CSU) and the Greens came to an end at the weekend, after the FDP decided to walk out for what it saw as a lack of compromise from other parties.

As a result, either the SPD agrees to enter a coalition with Merkel, she heads a minority government, or the country holds news elections. German President Frank-Walter Steinmeier is currently pressuring his party (the SPD) to form a so-called Grand Coalition with the conservatives and avoid the need for snap elections.

The influence of the president seems to be working. A general secretary for the SPD said early Friday that the party is ready to talk to Merkel and her party, though the group has yet to decide if it will be part of the new government or not.

"The SPD is firmly convinced that talks have to take place. The SPD is not closed to talks," Hubertus Heil of the SPD said, according to the Financial Times.

Schulz opposes becoming the junior coalition partner because this has previously impacted the party in a negative way, every time it joined forces with Merkel.

"It (the SPD) definitely doesn't work for them and it didn't work last time. That's why they said this time they would go into opposition and rejected the idea of another grand coalition," Traugott told CNBC.

The Social Democrats, who had governed alongside Merkel in the previous mandate, saw its worst election result since the World War II in September. An outcome particularly tough on Schulz, who left his role as chief of the European Parliament earlier this year to lead the Socialist Party and put an end to Merkel's 12 years at the helm.

Siemens CEO criticizes Schulz

Meanwhile, the head of one of Germany's biggest companies reportedly said in a letter that Schulz was currently acting irresponsibly.

Joe Kaeser, CEO of Siemens, hit back Thursday after previous comments from Schulz, according to German newspaper Handelsblatt.

He said that perhaps one should really think about who is acting irresponsibly: Those who try to tackle foreseeable problems and find long-term solutions or those who bow away from their responsibility and dialogue.

Schulz recently blamed the Siemens boss for cutting jobs, acting irresponsibly and profiting from the state.