Merkel pledges 'fresh start' for Europe with new government

Germany Hints At Solidarity Tax Cut

The two coalition partners agreed to the aim as part of their wider talks to form a new coalition government following last September's elections. The new governing coalition still has to be approved by members of each of the three parties.

Merkel will be meeting in a series of talks with SPD leader Martin Schulz until Thursday.

"Who is going to fight for an exit from coal or a real reduction of Carbon dioxide emissions in the "grand coalition"?" asked Robert Habeck, who is running for the Green party's leadership.

However that will likely depend on whether she can build on the policy document agreed on Friday over the coming months and forges what would be her third "grand coalition" with the SPD. The problem is that the announced budget for the implementation of government policies amounts to 45 billion euros ($54.2 billion) and the proposals by the parties are two times as large as the budget. Still, Merkel is trying to gain the SPD's support. Others worry that a new grand coalition would make the AfD the main opposition party.

Mr Schulz described the talks as "long, tough, exciting and turbulent", adding: "I think we achieved an excellent result".

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

The three German parties also support turning the eurozone emergency fund, the European Stability Mechanism (ESM) into a full-blown European Monetary Fund under parliamentary control and anchored in EU law.

The document stipulates that the European Union must play a leading global role in climate protection and advocate an ambitious implementation of the Paris Climate Change Agreement.

French President Emmanuel Macron, concerned that a divisive discussion over eurozone reform might undermine his broader European agenda, has begun prioritizing other areas of EU cooperation, French officials say.

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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.

However, he has been forced to wait for months for a concrete response from Merkel, who has come under mounting criticism at home and overseas for her plodding reaction to Macron, aggravated by her struggle to form a new government.

"But let's be optimistic, it's a really good start to discuss the future of Europe", said Baasner.

This comes as a relief to Merkel, who could have faced fresh elections had the coalition talks collapsed.

The SPD's youth movement leader believes renewing an alliance with Merkel would deal a death blow to the Social Democrats, who suffered a historic low score in September's elections.

"It is a significant, positive, forward-looking contribution to European policy debate in Europe".

"The sooner we have a stable German government, the better for France", he was quoted as saying. Already, in the Christian Democrats' Bavarian sister party, the Christian Social Union, its chairman Horst Seehofer is stepping down as state premier in favor of the much younger Markus Söder. The formal coalition talks need the green-light to kick off. They feared of the party being further minimalized under the Union.

Mujtaba Rahman of political consultancy Eurasia assigned a 35 percent probability to coalition negotiations failing and leading to an early election or a minority government.

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