GERMAN Chancellor Olaf Scholz dramatically fired Finance Minister Christian Lindner of the right-wing Free Democrats late on Wednesday night after a marathon of crisis meetings.

The three remaining ministers of the Free Democrats also resigned.

The move effectively led to the collapse of the government coalition.

However, in another unexpected turn of events, Transport Minister Volker Wissing from the Free Democrats took back last night’s resignation and told reporters this morning in Berlin that after talking to Mr Scholz, he had decided to stay on as minister and leave the party instead.

Mr Scholz announced late on Wednesday that he would seek a vote of confidence on January 15 that he said might lead to an early election as soon as March — which otherwise would have been due next September.

Chancellor Scholz had accused Mr Lindner of breaching his trust and publicly calling for a fundamentally different economic policy, including what the chancellor said would be tax cuts worth billions for a few top earners while cutting pensions for all retirees.

Mr Scholz’s Social Democrats will now effectively lead a minority government with the remaining coalition partner, the Greens.

The chancellor announced late on Wednesday that he would reach out to the leader of the biggest opposition leader in parliament, Friedrich Merz’s right-wing Christian Democrats, to discuss possible ways of strengthening the economy and passing important legislation.

Germany’s economy is in trouble, with the metals, chemical and automotive industries facing existential crises sparked by energy prices far higher than in the US or China. Flagship car manufacturer Volkswagen is threatening factory closures that will cost thousands of jobs.