Angela Merkel, SPD clinch deal to end Germany's political gridlock

Chancellor Angela Merkel reached a preliminary accord with the Social Democrats to end Germany’s political gridlock, moving closer to a fourth term and defying domestic critics who say her time is running out.

The next hurdles are a key vote by her reluctant SPD partners later this month and then finalising 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 US.

“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.