World News

Macron says 'happy' Merkel coalition deal in sight

Macron says 'happy' Merkel coalition deal in sight

German Chancellor Angela Merkel's Christian Democratic Union (CDU) party has agreed a blueprint with the country's Social Democrats (SPD) on moving ahead with formal coalition talks.

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

After 18 hours of talks and still no agreement in sight between Merkel s conservatives and the centre-left Social Democrats, tired negotiators said a result would likely not emerge before dawn.

Merkel initially turned to two smaller parties, the Free Democrats and Greens, to form a new coalition government for her fourth term. "In addition, more should be invested in apartments, in traffic and in the energy transition", she added.

The improved risk sentiment around the world, with the stock indices in the USA moving to all time highs, is also likely to further fuel the rally.

Ms. Merkel's only other option is to rule as a minority government, which would mean building coalitions on the fly, behind every new piece of legislation, always worrying about an insurrection.

Chancellor Angela Merkel has reached a breakthrough agreement with Germany's second biggest party during talks aimed at forming new coalition government.

Issues surrounding finance were emerging as key sticking points even as Germany posted sterling growth for 2017 and a record surplus.

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CSU chief Horst Seehofer said he was "highly satisfied" with the outcomes. The immigration of refugees should not exceed 180,000 to 220,000 people per year, no tax increases are planned, and the family reunion for refugees should be possible in the future "only for humanitarian reasons" and limited to 1,000 cases per month. This is why pundits are calling for a fresh start at the top of Germany's major parties.

She said her conservative Christian Democrats would "work constructively to find the necessary compromises but we are also aware that we need to execute the right policies for our country".

Kevin Kuehnert, head of the Jusos youth branch of the SPD, told broadcaster ARD that a deal among coalition negotiators to drop Carbon dioxide emissions goals "was not a good start to these talks".

"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.

The actual election was in September, whilst an initial potential coalition of conservatives, liberals and greens - the "Jamaica" option - fell apart during talks late a year ago.

Germany's Social Democratic foreign minister Sigmar Gabriel on Sunday said it was time "that we finally support the French in their reform efforts".

"The government would have to avoid all the controversial issues which would be not an ideal situation, but it would also avoid the second alternative, which would be new elections", he said, adding that no one wants to go back to the electorate now as "they're anxious that they would suffer additional losses and the situation in the parliament would be even more confused".

If this grand coalition is formed, I think it will be favorable to Europe. 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.


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