German Coalition Talks Drag Deep Into The Night As Deadline Nears

German Coalition Talks Drag Deep Into The Night As Deadline Nears

Schulz also stressed the importance to the SPD of reaching an agreement for a makeover of the European Union, with his party wanting Berlin to back French President Emmanuel Macron's European Union reform plans.

Macron, who had pressed the Social Democrats (SPD) to return to a grand coalition with Merkel's conservatives, said the blueprint was "more favourable" for his vision of a reformed European Union than an earlier agreement that was discussed - then abandoned - between Merkel and the pro-business FDP party. A 28-page deal is also set to cap asylum seekers coming to Germany for the first time at no more than 220,000 per year, which is something the conservatives have been demanding.

A new coalition government would see Merkel at the helm of Europe's biggest economy for a fourth term in office.

It paves the way to formal coalition negotiations that will end government vacuum lasting for over three months since September 24 federal elections, and the new policies will be a strong boost to European Union after the Brexit.

Even if negotiators find a deal, it can still be torpedoed when SPD delegates and later rank-and-file members get to vote on whether the traditional labour party should once again govern in Merkel s shadow.

A grand coalition would also leave the controversial Alternative for Germany as the lead opposition party in parliament.

The deal "smells strongly of a continuation of the governing style we know from the last grand coalition, which didn't do much good for society or for the SPD", he said.

The agreement was welcomed by France and the European Com-mission, where concerns have mounted in recent months that the window for reforming Europe could close without a German breakthrough.

Macron tries to sway Trump on Iranian nuclear accord
State Department officials initially suggested it could come as early as Thursday, but later said it would not happen before Friday.

In fact the political talks were tripped up by the country s strong finances, as parties had opposing views on how to manage the cash.

Macron said he and Kurz, a conservative who formed a government with the far right in December, had found many "points of convergence" during their talks in Paris.

But if those talks fail, then Merkel has two options, neither of which are ideal, said Anderson.

The in-principle pact after months of paralysis averts the unpopular prospect of snap elections for now, but there are still several hurdles to clear, some of which may prove perilous. Given the enormous pressure on Ms Merkel to form a government-therefore avoiding another election where populists could make further gains-this appears more likely.

European Commisison president Jean-Claude Juncker welcomed "a significant, positive, constructive, forward-looking contribution to the European policy debate".

Business leaders said that with the compromise paper, the probability of Germany finally getting a new government has risen, which was important for business as it would put an end to the ongoing uncertainty in Berlin. "The coalition negotiations probably won't be easier than the exploratory talks".

However, as CDU/CSU's coalition negotiations with the Greens and the Free Democrats collapsed, Schulz saw an opportunity to push his pro-Europe, social agenda through.

Though a challenger has yet to come forward, impatience is growing in Christian Democrat ranks about Merkel's tendency to manage crises as they arise rather than presenting a vision the party can rally behind and sell to voters.

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