Merkel and Macron Want to Dominate Europe by Strengthening Their Partnership

Pauline Gross
January 13, 2018

And, for her part, Merkel made clear the Social Democrats were not her first pick for a coalition partner - but after talks with other party leaders collapsed in November, she had few other choices if she wished to end the stalemate that has left Germany without a new formal government for almost four months.

The consensual document constitutes skeleton of government programme of future German executive.

The talks between Merkel's Christian Democrats (CDU), Bavaria's Christian Social Union (CSU) and SPD are due to conclude on Thursday, before SPD leaders recommend to their members whether they should shift into official negotiations.

The improved risk sentiment around the world, with the stock indices in the United States moving to all time highs, is also likely to further fuel the rally. Even if coalition negotiations prove fruitful, it remains unlikely the new government would take office before April. But the three parties have clashed over immigration, Europe and finance. "We are convinced that Europe needs a fresh start and have developed the right ideas to go with it".

"It will be a tough day but I'm going into it with a lot of energy because the people expect us to sort it out", she said ahead of negotiations.

To win over the SPD, Merkel agreed to 5.95 billion euros ($7.2 billion) of investment in education, research and digitalization by 2021, expanded child care rights, and a pledge to strengthen Europe's cohesion with increased German contributions to the European Union budget.

These preliminary discussions ended with an agreement that formal talks over the formation of a "grand coalition" could begin in the coming weeks and thus end Germany's longest period of post-war coalition building.

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"We had intensive, serious, very deep exploratory talks", said Merkel, looking ebullient and a little relieved alongside the other two party leaders in the SPD's headquarters in Berlin.

A 28-page paper was drawn up overnight, after five full days of talks, that contained a list of agreed policies that the two leaderships now have to sell the proposals to their respective party bases.

The chancellor needs the coalition talks to succeed in order to avoid her personal authority being further undermined and Germany's worldwide standing diminished.

The SPD's youth wing chief Kevin Kuehnert told Zeit Online that he would embark on a national tour to press his case to opposing a new grand coalition before a September 21 party congress.

The talks are not only crucial for Merkel, but also for Schulz and the leader of Merkel s Bavarian allies, Horst Seehofer, said political analyst Karl-Rudolf Korte of Duisburg-Essen University. Far-reaching reforms that from 2004 under former Social Democratic Chancellor Gerhard Schroeder that lowered business costs are often credited for boosting the country's economic performance.

Considered a potential breakthrough on a new grand coalition following months of political uncertainty, the document could nevertheless be changed before the start of the formal talks.

And now, it seems, she can't even form a government. The government plans to obtain the appropriate public financing for the project from the proceeds it receives from auctioning off UMTS and 5G licenses, according to a position paper seen by RND from the parties' expert group on digitization and economics.

Other reports by GizPress

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