German chancellor Angela Merkel's conservative Christian Democrats (CDU) and its Bavarian allies (CSU) struck a preliminary deal with the centre-left Social Democrats (SPD) on Friday (12 January) to open formal coalition talks.
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.
Schulz said the SPD would only agree to form a coalition if it was sure such a government would strengthen Europe, adding that his party would make suggestions on how to do that during Thursday's talks. For instance, the refugees will be limited to between 180,000 and 220,000 per year, while previously the Union agreed to limit it up to 200,000 and the SPD opposed to set a cap on it.
Heading into their final day of talks on Thursday morning at SPD headquarters, Dr Merkel and her SPD opposite number, Martin Schulz, said they were anxious to secure a deal and end almost four months of political limbo. Unable to win the support of another party for a governing coalition yet, Merkel is now staring down the possibility that the monthslong standoff may force a new election entirely.
The leader of the Jusos youth branch of the SPD told broadcaster ARD that a deal between the coalition negotiators to drop plans to lower carbon dioxide emissions by 40 percent from 1990 levels by 2020 "was not a good start to these talks".
Though members of both parties worry that another grand coalition could further erode their support and strengthen fringe parties, they fear new elections even more.
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.
They also welcomed the parties' clear commitment to the EU.
Before a cluster of media in Berlin, German Chancellor Angela Merkel and her center-left counterparts announced they have agreed to a draft deal for a coalitiongovernment.
Merkel has been largely absent from the global stage in recent months as she focuses on her domestic woes, just as a newly confident France is looking for a strong partner in Berlin to help drive President Emmanuel Macron's European Union reform plans.
NELSON: She said she wasn't sure until the very end that the deal would happen and lauded the negotiators for persevering.
"Time is running out", said Stefan Kornelius, a Merkel biographer. Only with those members' OK can full-blown coalition talks proceed.
Should none of these options pan out, the German president, Frank-Walter Steinmeier, will be forced to call new elections, something no one wants with the current slate of leaders - at best, the results will be the same.
An effort to form a complicatedcoalition led by Merkel's Christian Democrats and including the Greens and the liberal Free Democrats failed in November.
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.
Seehofer said last week that he hoped a new government would be in place before Easter, which falls on April 1.