Merkel finally clinches coalition deal with SPD

German Chancellor Angela Merkel’s conservatives and the centre-left Social Democrats (SPD) finally reached a coalition deal on Wednesday, ending more than four months of political uncertainty in Europe’s biggest economy.

Merkel’s Christian Democrats (CDU), her Bavarian-based sister party, the Christian Social Union (CSU), and the SPD managed to resolve the final sticking points early on Wednesday, party sources told dpa.

The coalition talks were extended twice beyond the Sunday deadline amid differences over health insurance and labour market issues and distribution of cabinet berths.

SPD, with an eye on plum posts, negotiated hard as it very well knew that Merkel needed them badly to rule the country for another four years. The party finally grabbed the three top posts in the chancellor’s new cabinet, namely the Finance Ministry, the Foreign Office and the big-budget Labour and Social Affairs portfolio.

CSU chief Horst Seehofer has been handed a revamped Interior Ministry that deals with sensitive subjects like immigration, refugees and domestic security.

Seehofer’s choice comes ahead of a tough state election in Bavaria later this year where the right-wing, anti-immigration, populist Alternative for Germany (AfD) poses threat to Merkel’s coalition. AfD had made big gains in the southern state during September’s elections.

Merkel may face criticism from within her party for giving plum portfolios to SPD in what many may see as a desperate attempt to clinch a coalition deal.

For Merkel, the troubles are not over yet as SPD’s more than 460,000 members will now vote on the coalition deal in a ballot. The results will be announced in the first weekend in March.