Merkel, SDP near Germany coalition deal

Both sides upbeat about possible deal on Tuesday, meeting a self-imposed deadline

German Chancellor Angela Merkel.

Berlin: German Chancellor Angela Merkel’s conservatives and the centre-left Social Democrats inched closer towards a coalition agreement Monday, raising hopes of an end to months of political gridlock in Europe’s top economy.

As a final round of talks stretched into the evening, both sides sounded upbeat a deal would be sealed on Tuesday, just in time to meet a self-imposed deadline.

“I’m confident, but I have delayed my flight until tomorrow,” Julia Kloeckner of Merkel’s CDU party told reporters.

Negotiators from Merkel’s CDU/CSU bloc and the Social Democratic Party (SPD) will continue talking late into the night before adjourning and resuming on Tuesday morning, party sources told AFP.

“I believe the will is there on all sides,” top CSU lawmaker Alexander Dobrindt of Merkel’s Bavarian sister party said. “But big hurdles remain.”

In a sign of progress, SPD leader Martin Schulz said agreements had been reached on key European issues.

“We all agree that the future of our country lies in a strong and united Europe,” Schulz wrote in a message to party members.

Germany has been in limbo since an inconclusive September election left Merkel and her CDU/CSU bloc without a ruling majority, leading to the longest coalition negotiations in postwar history and weakening the veteran chancellor’s leadership.

The Social Democrats, Germany’s second largest party, have served under Merkel in a right-left “grand coalition” for two of her three terms since 2005.

But governing in her shadow has cost them vital support and they scored a historic low 20.5 percent in the election.

Schulz had initially ruled out working with her in the next four years, preferring to sharpen the SPD’s profile in opposition.

SPD to have final say

Merkel at first turned to two smaller parties, the Free Democrats and Greens, to form a new government.

But when those talks collapsed in acrimony in November, she had to once more woo a reluctant SPD for a new pact.

The SPD has sought to drive up the price for a deal, which it must still sell to its 440,000 members who will vote on the pact in a yes-or-no referendum.

That vote is expected to be tight, with leaders aiming to have a government in place by the end of March.

The two main parties reached a breakthrough deal in January when they presented an in-principle agreement to start formal coalition talks.

But the last round of negotiations has thrown up several sticking points.

SPD demands to shift temporary workers to permanent contracts and to make Germany’s health insurance system fairer have run into strong conservative opposition.

“You see in the areas where we are still far apart that we are very different parties,” Family Affairs Minister Katarina Barley of the SPD told public radio.

A deal for Europe

At stake for Merkel is whether she leads a stable coalition into her fourth term or risks a fragile minority government or new elections.

Both sides hope to avoid going back to the polls amid concerns the drawn-out gridlock could strengthen the far-right Alternative for Germany (AfD), which scored nearly 13 percent in the September election.

The political impasse in a key European Union member has had repercussions abroad, holding up French President Emmanuel Macron’s push to overhaul the bloc and deepen eurozone integration.

Merkel has offered only tentative backing for the reform plans, but the SPD has been more enthusiastic – even about some of Macron’s more ambitious proposals for the eurozone such as a joint budget and finance minister.

Schulz on Monday said the would-be coalition partners had successfully finished the European chapter of their talks. While details remain vague, he said they had agreed to invest more in the eurozone and put an “end the austerity diktat”.

The parties also wanted “fair taxation” for internet giants like Google, Amazon, Facebook and Apple, he said.

Meanwhile, a new Insa survey to be published in Bild newspaper on Tuesday found that the protracted coalition wrangling had sapped support for the main parties.

If elections were held now, the CDU/CSU’s score would slip from 33 to 30.5 percent, while the SPD would slump to 17 percent – meaning they parties would no longer hold a parliamentary majority together.

The AfD would garner a record 15 percent.


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