Germany’s centre-left Social Democrats (SPD) have reached an agreement on a coalition government with Chancellor Angela Merkel’s conservatives (CDU/CSU), according to media reports.
A deal on distributing ministries was said to be one of the last major hurdles towards forming a coalition.
The agreement looks set to end more than four months of wrangling since inconclusive elections in September.
Negotiators have been in non-stop talks since Tuesday morning.
The remaining stumbling blocks have been workers’ rights and healthcare.
Immigration, Europe, and tax, have also been points of contention.SPD leader Martin Schulz had at first ruled out going back into government with Mrs Merkel’s centre-right CDU and its Bavarian sister party, the CSU.
But he changed his mind when CDU/CSU coalition talks with the liberal Free Democrats (FDP) and Greens broke down.
After months of stalemate, there are now hopes Germany could have a government in place by Easter.However, the SPD’s 460,000 members will have a final say on whether to accept a coalition agreement in a postal vote due to take place in coming weeks.
Those opposed to any deal with Mrs Merkel include a new group within the SPD calling itself NoGroKo (no grand coalition).
European Union allies, such as France, see Germany as a pillar of stability in the bloc and have been hoping Mrs Merkel succeeds.The centre-left Social Democrats will reportedly get a number of key ministries, including finance, foreign and labour.
This would have a big impact on the rest of the world, particularly Europe.
A Social Democrat finance ministry is more likely to go along with French President Macron’s ambitious plans for EU reform, by allowing more German support for struggling eurozone economies.
And at home these powerful ministries would help the SPD push for key left-wing policies, such as better rights for employees.
All of this could go down well with SPD party members, who will vote on any final coalition deal.
An agreement which looks like a win for the SPD will increase the likelihood that they will vote yes.
But if they vote no, then the most likely outcome could be fresh elections.