Merkel in renewed bid to build a coalition

BERLIN: German Chancellor Angela Merkel, weakened by an election setback in September, is set to launch a second bid to build a coalition government tomorrow when she holds exploratory talks with the Social Democrats (SPD).

A re- run of her “grand coalition” with the SPD, in power from 2013 to last year, appears the best option for conservative Merkel as it would provide stability in what would be her fourth term.

But with success far from guaranteed, there are a range of other possible scenarios.

After her conservatives bled support to the far-right Alternative for Germany in the September 24 national election, Merkel saw her authority undermined two months later by the collapse of coalition talks with the pro- business Free Democrats and Greens.

That shifted her focus back to the SPD but the centre-left party is wary of another tie-up with Merkel after voters punished it for four years of power-sharing in September, when its support slumped to its lowest level since 1933.

Experts see the talks lasting at least until March. Although the caretaker government under Merkel is keeping things ticking over, investors fear protracted talks will delay what they view as necessary reforms in Europe’s biggest economy and the bloc as a whole.

After a flow of leaks, tweets and selfies emanating from last year’s three-way coalition talks undermined trust, participants have agreed to a news blackout during negotiations.

The most likely outcome of the talks is a coalition of the conservatives and the SPD, given the two camps have ruled together for eight of the 12 years Merkel has been chancellor and broadly agree on foreign and security policy. However, with both blocs struggling to stem a fall in support, it is by no means a done deal.

They are at odds on a range of issues, from tax to health care and Europe.

The SPD wants a wholesale reform of health insurance. Conservatives oppose this and are more sceptical about deeper EU integration.

Migrant policy is likely to be one of the trickiest issues of the negotiations. – Reuters