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Centre-left-led alliance seals deal on new German govt

·3-min read

A centre-left-led alliance of parties on Wednesday announced a deal to form Germany's new government, replacing Angela Merkel's cabinet and putting the Social Democrats (SPD) in charge for the first time in 16 years.

Two months after the SPD beat Merkel's conservative CDU-CSU bloc in a general election, it concluded a roadmap on plans for Germany's next four years with the Greens and liberal Free Democrats that will install Finance Minister Olaf Scholz, 63, as chancellor.

The relatively rapid accord is likely to be greeted with relief by international partners wary of a hamstrung Germany while crises from the coronavirus pandemic to Belarus and a weak economic recovery rage.

Voices within Germany have grown louder for greater urgency from the new coalition to curb a surging fourth wave of the pandemic as hospital beds fill up and new infections soar to record highs day after day.

In a sign of the emergency, Merkel, who is retiring from politics after four terms, summoned the leaders of the new coalition parties for talks over the rapidly deteriorating Covid situation midway during their last spurt of negotiations Tuesday.

In their pact published on Wednesday, the incoming government said it will set up a crisis team to fight the health emergency.

The so-called coalition contract essentially sets their policy roadmap for the term in government.

It includes a plan to bring Germany's exit out of coal forward to 2030 from 2038, a pledge to reinstate the country's constitutionally enshrined debt limit for 2023, as well as a proposal to legalise recreational use of cannabis.

- 'Super' ministry? -

A thorny part of the talks -- which party takes which ministry -- was also settled.

With the business-friendly FDP to run the powerful finance ministry, the leader of the party Christian Lindner is poised to take charge of Europe's biggest economy's finances.

A new "super-ministry" grouping the portfolios of economy, climate protection and energy and the foreign ministry go to the Greens, with Robert Habeck, co-leader of the ecologist Greens, expected to take the environmental portfolio.

Annalena Baerbock, the Greens' other leader, is poised to become Germany's next foreign minister -- the first woman in the job.

The line-up hints at a Germany that could take a more assertive tone towards China and Russia, while economically it will likely stick to budgetary rigour and aggressively push green investments.

The swift pace at which the three parties -- known in Germany as the Ampel or "traffic-light" after their colours -- came together defying expectations as the FDP is not seen as a natural partner of the centre-left SPD or Greens.

But the parties were anxious to avoid a repeat of the messy negotiations four years ago, when Lindner was vilified for pulling the plug on talks with Merkel's CDU-CSU and the Greens.

- 'Sleep soundly' -

Known for her steady hand steering Germany through the eurozone crisis, migrant influx and Brexit, Merkel is leaving office still widely popular with the German electorate.

Mindful of the value placed on a stable Germany, the veteran politician has taken pains to ensure an orderly transition.

Stressing continuity, she included Scholz in key bilateral meetings during the G20 summit in Rome in October including with US President Joe Biden.

When she met regional leaders of Germany's 16 states for urgent talks last week on the pandemic, Scholz was prominently also in attendance.

She has also shrugged aside the fact that Scholz hails from a rival political party, saying she will be "able to sleep soundly" with him as chancellor.

Vote of confidence from Merkel aside, Scholz is an experienced hand, having been labour minister in her first coalition from 2007 to 2009 before taking over as vice-chancellor and finance minister in 2015.

Known for being meticulous, confident and fiercely ambitious, he has cemented his reputation as a fiscal conservative -- something that at times puts him at odds with his workers' party.

hmn/mfp/gw

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