Merkel faces endgame for next German government in party talks

(Bloomberg) German Chancellor Angela Merkel is setting herself a Sunday deadline to unite four parties into her next governing coalition and avert a political crisis in Europe's biggest economy.

With a day of marathon negotiations ahead, Merkel and her Christian Democrat-led bloc face an increasingly tense endgame to win over the Free Democrats and the Green Party for formal coalition talks, or else risk triggering new elections and a possible end to Merkel's fourth term before it begins. A deal in Berlin would open the door to bargaining on a detailed policy agenda and cabinet posts that her party would like to conclude by Christmas.

Either way, Germans are headed for uncharted territory. The three factions -- nicknamed Jamaica for their respective party colours -- haven't governed together at the national level, and post-World War II Germany has never held a repeat election.

"A failure of the Jamaica talks could produce massive instability in Europe," Winfried Kretschmann, a Green negotiator who's the premier of Baden-Wuerttemberg state, home to Daimler and Porsche cars, told reporters in Berlin on Saturday. "There's no way of telling yet what the outcome will be."

After four weeks of preliminary talks, negotiators said Saturday that consensus on economic policy, Europe and transportation are within reach. That leaves immigration and cuts in carbon emissions as two major obstacles to be addressed on Sunday.

Germany's election almost eight weeks ago left the country with its most splintered political landscape since the war. Merkel won with her bloc's lowest share of the vote since 1949, while the anti-establishment Alternative for Germany, which campaigned against the chancellor's liberal refugee policy, entered parliament with 12.6% of the vote.

While billed as exploratory, the talks have been so hard-fought because once the parties agree to start formal coalition talks, "there's no turning back," Bavarian premier Horst Seehofer, who's negotiating for the Merkel-allied Christian Social Union, told reporters.

Sense of responsibility

German President Frank-Walter Steinmeier called on all sides to stop jockeying for position and move forward. While his post is mostly ceremonial, it would be up to the president to call new elections.

"Parties always try to bid up the price before the official kickoff," Steinmeier said in an interview with Welt am Sonntag newspaper. "In many ways, what we've witnessed in recent weeks isn't much different from earlier coalition negotiations. But of course I expect all sides to be aware of their responsibilities."