Merkel faces make-or-break week in talks to form government

by BLOOMBERG

BERLINGerman Chancellor Angela Merkel (picture) entered the final stretch of preliminary talks to form a new government yesterday as factions in the complex multi-party negotiations remained far apart on issues including migration, climate and Europe.

Entering a fifth week of exploratory negotiations between Merkel’s Christian Democrats, her Bavarian CSU sister party, the pro-market Free Democrats and the environmental Greens, the parties face a self-imposed deadline of Thursday to wrap the talks. The Greens over the weekend warned the process could collapse, raising the prospect of an unprecedented minority government or a repeat election.

“Until now we’ve seen little movement among the others — I think it’s clear now that time is running out and we now need results,” Green co-leader Cem Oezdemir told Deutschlandfunk radio early

yesterday. Juergen Trittin, the veteran former Green environment minister, told Tagesspiegel that “not a single point from our 10-point plan has been implemented — for the Greens, the score is zero to 10”.

Merkel has maintained a low profile after emerging victorious but weakened in the Sept 24 election, focusing on forging a four-way coalition for the first time in the 68-year history of the federal republic. Although talks have made progress on education spending and digital infrastructure, the parties have struggled to find a common line on Germany’s refugee crisis and the country’s climate goals.

Party leaders on Sunday met to set the agenda for the week before meeting in smaller groups yesterday. Officials aim to establish a written preliminary agreement, which the Greens plan to put to a party conference vote on Nov 25. That’s viewed as the main obstacle before the groups reconvene for official coalition talks, during which they’ll draw up a blueprint for the next four years.

The Social Democrats, who suffered their worst electoral defeat since World War II, have vowed not to form a coalition with Merkel’s bloc. Should the multi-party talks fail, that leaves open the option of a minority government — also without precedent in postwar history — or new elections, a risky prospect given the rise of the farright Alternative for Germany, which won 12.6% in September.

The Greens last week softened their demand for a phaseout of carbon dioxide (CO2)producing coal and an end to the sale of new combustion engines by 2030. But they’ve demanded a concrete plan for Germany to achieve its now-ambitious CO2 reduction goals as well as its commitments as part of the global Paris accord.

Merkel over the weekend said in a video podcast that achieving climate goals was crucial, but mustn’t endanger German industry and jobs.

The Free Democrats, meanwhile, backed off the party’s demand to phase out the European bailout fund. But the party has stepped up calls for tax cuts, particularly by winding down within this legislative period the so-called solidarity charge, designed to help fund infrastructure in the formerly communist east. — Bloomberg