Three weeks after the election it is finally official. MSNBC has just reported on its Web site:
German conservative leader Angela Merkel will become the country’s first woman chancellor under a deal struck with Chancellor Gerhard Schroeder’s Social Democrats, senior sources from the leading parties said on Monday.
Under the agreement, the SPD is poised to get the foreign, finance, justice and labor ministries in a new coalition government with Merkel’s Christian Democrats, a senior SPD source told Reuters.
Schroeder and Franz Muentefering, the chairman of his Social Democrat party, will meet Merkel and her ally, Christian Social Union leader Edmund Stoiber, for a third and probably final time at 11 a.m. on Monday.
The four left a second round of discussions shortly before midnight on Sunday without saying a word.
The wrangling between the main forces on the left and right comes after a general election gave neither the conservatives nor the SPD enough votes to rule with their preferred partners.
Schroeder’s party is expected to extract key concessions from Merkel on economic policy, resulting in a dilution of the reform agenda she pushed during the election campaign.
It will be interesting to see it Schroeder becomes the new foreign minister, remaining a thorn in the side of Washington (this is the so-called Stresemann option). Despite the expectation that the economic reform agenda will be retarded, the end of the political impasse has strengthened the Euro today, according to Bloomberg.
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