1 November 2005

BERLIN - Plans for a German grand coalition under designated chancellor Angela Merkel appeared to be in crisis Tuesday after two of her cabinet heavyweights pulled out of the planned government.

Bavarian Prime Minister Edmund Stoiber, a member of Merkel's Christian Democratic alliance (CDU/CSU), will not serve as economics minister, party sources confirmed to Deutsche Presse-Agentur, dpa.

Stoiber's exit follows the surprise resignation Monday of Franz Muentefering, the leader of outgoing Chancellor Gerhard Schroeder's Social Democrats (SPD). Muentefering quit after the party executive rejected his candidate for the post of SPD secretary general.

Muentefering has been slated to be vice-chancellor and labour minister under Merkel - but it is now unclear if the party will allow him to hold these posts when he formally stands down in two weeks.

In any case, Muentefering would be greatly weakened in any cabinet after being the victim of what analysts called a "putsch" by his own troops.

"Lightning has struck the SPD - Muentefering's resignation means chaos," said a Bild newspaper commentary, adding: "Stoiber is waving a white flag and Merkel is giving up almost all of her principles."

The Stoiber, Muentefering duo - two of Germany's most ruthless political operators - had been seen as anchors of the planned coalition because Stoiber heads the Bavarian CSU and Muentefering was SPD chairman.

Merkel, who chairs the CDU, completed the cabinet party leadership triad which had been envisaged to impose iron-clad stability on the awkward marriage of Germany's two biggest blocs which are normally bitter rivals.

Shrugging off the grim personnel developments, Merkel and Chancellor Schroeder insisted negotiations for a grand coalition would continue and should be wrapped up by a November 14 deadline, with the new government under Merkel due to be formally elected by parliament on November 22.

"There are absolutely no signs that anything has changed in the timetable," said Merkel at a Monday evening news briefing.

But the reality is that almost anything could now happen.

Muentefering was a centrist who got on well with Stoiber and Merkel. If the SPD elects a leftist leader the grand coalition deal may unravel. A new SPD chairman may be nominated Wednesday and will be elected at a November 14 to 16 party congress in Karlsruhe.

Conservatives warned that any leftward drift of the SPD would torpedo the grand coalition.
"If the SPD makes more leftist policy demands then I see the whole thing in danger," said Wolfgang Zoeller, deputy parliamentary leader of the CDU/CSU in Berlin.

Newspaper commentaries speculated that Merkel's grand coalition project may collapse.

"Will the grand coalition burst?" was the Bild tabloid newspaper's headline.

Some analysts predict the SPD will try to set up a leftist government with its Greens allies and the former East German communists. The three parties have a Bundestag majority but Muentefering and Schroeder have vowed never to rely on the post-communists to gain power.

Others in the SPD, such as Mayor Klaus Wowereit of Berlin, are in favour of such a move. Wowereit rules the German capital in an SPD coalition with the ex-communists, the Party of Democratic Socialism.

The newspaper Die Welt said Merkel's government was not even in office yet "but already in crisis ... Everything is now possible, even new elections which none of the big parties want."

A report in the Rheinische Post newspaper said Merkel's CDU/CSU are pondering new elections and have settled on March 26 as a target date.

New elections would mean that Chancellor Schroeder and his cabinet stay on in power under caretaker status for the next five months.

It is unclear who the SPD chancellor candidate would be but Schroeder cannot be ruled out.

When asked at last week's European Union summit in Hampton Court, England how he felt being at his last summit, Schroeder grinned and held out his hands with the palms upraised as if to say "how do you know this is my last summit?"

New elections, while still unlikely, would mean Germany is subjected to almost an entire year of campaigning given that the current political crisis was triggered by the defeat of Schroeder's SPD in regional elections last May.

Meanwhile, the country struggles with weak economic growth and unemployment over 11 per cent which were top issues in the past election and remain the prime concern of voters.

DPA

Subject: German news