The German Chancellor has been desperately attempting to strike a deal with former European Parliament President Martin Schulz – who currently leads her biggest rival in the Bundestag, the Social Democratic party (SPD).
The grand coalition of Germany’s two biggest parties would save Ms Merkel from having to lead with a minority Government – a feat which has never been attempted in the history of the Bundestag.
However, while the SPD have opened up to talks with Mrs Merkel’s CDU on January 7, the two have given themselves the minute deadline of mid-January to broker a deal.
The German political class are concerned under a minority government the stalwart German Chancellor will struggle to achieve in her fourth term – or be forced to pander to the far right Alternative for Germany (AFD) party who gained a foothold in the parliament in September’s vote.
Ahead of the talks top party officials from the Chancellor’s CDU, its Bavarian sister party the CSU and Mr Schulz’s SPD met to set out a timeline for talks, with all three claiming “it was a good conversation in an atmosphere based on trust” in a joint statement.
It comes as the world watches and waits for the German Chancellor to build up a new Government to lead the central European superpower.
One Brussels chief has admitted the feeling about Europe is “fragile” in Germany as Angela Merkel struggles to hold onto power.
Pierre Moscovici, the European Commissioner for Economic and Financial Affairs, Taxation and Customs admitted that the feeling around Europe is fragile in Germany.
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Angela Merkel’s last hope is a grand coalition with Martin Schulz
Speaking to Bloomberg, he said: “There is something interesting about the election itself.
“That you can have full employment, you can have a huge success economically and still people wandering and a split vote.
“And also an extreme right party coming in inside Parliament which is the first time since World War 2.
“That proves that the feeling among the voters is still very fragile about Europe and about the economy.”
Mr Moscovici, however, backed Mrs Merkel to continue to lead Germany forward.
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The SPD have opened up to talks with Mrs Merkel’s CDU on January 7
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One Brussels chief has admitted that the feeling about Europe is ‘fragile’ in Germany
He said: “Yes there is a caretaker Government, but there is a Government and there is a strong leader who is Mrs Merkel.”
The comments come as a professor has claimed that the populist movement in Europe is not over, and Austria’s new coalition has provided more evidence.
Matthew Goodwin, a Professor of Politics, pointed out the shift in beliefs on the continent, in the wake of new Austrian chancellor Sebastian Kurz’s inauguration, following a deal with the country’s right-wing Freedom Party (FPO), led by Heinze-Christian Strach.
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Angela Merkel could be the first Chancellor to lead Germany with a minority in the Bundestag
Mr Goodwin said: “The populist and centre-right are thriving because they understand that voters are not solely concerned about GDP and economic growth.
“Austria’s sharp rightward turn is merely a symptom of a much broader challenge to the EU that is deep and growing.
“Like Kurz and Strache, across the continent, an assortment of conservative, Eurosceptic and populist parties are seeking to take control of the EU project and push it in a fundamentally different direction, if not bring it down altogether.”