Clashes await Merkel in talks with new partners

30th September 2009, Comments 0 comments

The chancellor has said she wanted her new government in place before November 9, when she and other world leaders will gather for ceremonies to mark the 20th anniversary of the fall of the Berlin Wall.

Berlin -- Signs grew on Tuesday that Chancellor Angela Merkel, despite her election triumph, faces tough talks with new coalition partners on how to lift Germany out of its worst slump since World War II.

The conservative Merkel, 55, won a second term in an election on Sunday, though her conservative Christian Democrat (CDU/CSU) bloc lost support, notching up its worst election score since 1949.

Having to battle an economy set to shrink by as much as six percent this year, Merkel has teamed up with the Free Democrats (FDP) which campaigned with promises of 35 billion euros (51 billion dollars) worth of tax cuts, to trim Germany's social security system and make it easier for firms to hire and fire.

The German Association of Chambers of Commerce and Industry (DIHK) called the election result "a clear vote for courageous reform." Its president Hans Heinrich Driftmann said corporate tax cuts should now be "high on the agenda."

It is far from certain that Merkel, who said in her victory speech that she wanted to be the "chancellor for all Germans", is so ready to wield the axe, having promised lighter tax cuts of 15 billion euros.

"We are a people's party, and within this there is always the economic wing and those who lean more towards the social side," Merkel said on television late Monday. "As chair of the party and chancellor it is my job to combine economic good sense with social justice."

Merkel and FDP leader Guido Westerwelle met on Monday, and serious negotiations on a coalition pact are to start next week.

The chancellor said on Monday she wanted her new government in place before November 9, when Merkel and other world leaders will gather for ceremonies to mark the 20th anniversary of the fall of the Berlin Wall.

In her first term, Merkel was stuck in an uneasy coalition with the centre-left Social Democrats (SPD) and avoided making any painful reforms, even rolling back some of the cuts made by her SPD predecessor Gerhard Schroeder.

The FDP and the more business-friendly wing of the CDU/CSU are hoping that now that Merkel is free of the SPD, which is reeling after a disastrous election night, she will show her true colours.

Doubts remain though what the true colours of Forbes magazine' most powerful woman on the planet really are, however, with many observers seeing her something of an enigma.

"Over the last four years her position has become quite blurred," Goldman Sachs economist Dirk Schumacher told AFP. "Where does she actually stand?"

"The coalition talks with the FDP will be the moment of truth," the Financial Times Deutschland said in editorial.

"Merkel is already beginning to sense how difficult the cooperation will be," the Sueddeutsche Zeitung said.

More than half of voters voted neither for Merkel or Westerwelle, and Merkel remembers well her experience in the 2005 campaign when she threw away a commanding lead in the polls with a neo-liberal platform that spooked voters.

Simon Sturdee/AFP/Expatica

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