Bloomberg: Merkel's Bid to End German Gridlock Hangs on Key SPD Vote13 January 2018 | 05:28 | FOCUS News Agency
The next hurdles are a key vote by her reluctant SPD partners later this month and then finalizing the deal in another round of talks.
After a marathon of more than 24 hours of negotiations, leaders of Merkel’s Christian Democratic Union, her Bavarian sister party and the Social Democrats hammered out an agreement that outlines a possible alliance. The 28-page blueprint, largely aimed at winning over wary SPD members, calls for Germany and France to bolster the European Union and respond to President Donald Trump’s move to slash corporate taxes in the U.S.
“We are convinced that we need a new start for Europe,” Merkel told reporters at SPD party headquarters in Berlin on Friday. “I am therefore not concerned that we will be able to find reach new solutions here, especially with France.”
In addition to strengthening the EU, the parties agreed on modest middle-class tax cuts, including a phaseout of the “solidarity levy” for rebuilding ex-communist eastern Germany. In a nod to the Bavarian affiliate of Merkel’s party, the plan limits refugee arrivals to 220,000 a year.
Still, uncertainty remains almost 16 weeks after her party won an inconclusive federal election. In addition to the vote by SPD rank and file, cabinet posts -- including the powerful role of finance minister -- have yet to be negotiated.
Merkel has governed with the SPD in an alliance of Germany’s two biggest parties for eight of her 12 years in office. A rerun signals their lack of a “big bold vision,” while probably providing “a mild fiscal stimulus,” said Carsten Brzeski, German chief economist at ING-Diba in Frankfurt.
“For the main actors in these negotiations, a collapse could have marked the beginning of the end of their political careers,” he said. “It’s a breakthrough that leaves a bad taste in the mouth.”
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