Merkel to complete German cabinet line-up before bargaining begins
(AFP)
Updated: 2005-10-17 15:44

Germany's chancellor-to-be Angela Merkel will name the conservative ministers in her cabinet on Monday to complete the line-up of a coalition government which faces a formidable task to regenerate an ailing economy.

Merkel was to make her announcement shortly before the hard bargaining begins at 1500 GMT to hammer out a programme for the new government, in the first acid test for an alliance of political enemies.

The price Merkel paid for evicting Gerhard Schroeder from the chancellery after seven years was a power-sharing deal which hands his Social Democrats eight of the 14 cabinet posts, including the finance and foreign ministries.

Merkel will announce the identities of the six ministers her conservative Christian Union receives under the pact -- economy, interior, defence, agriculture, education and family, and the parliamentary speaker's chair.

Edmund Stoiber, the leader of the southern state of Bavaria, has already confirmed he will head the economy ministry.

Even before Merkel faces the difficulties posed by managing the Social Democrat ministers, she has clashed with Stoiber, who leads the Christian Social Union (CSU), the Bavarian sister party of her Christian Democratic Union (CDU).

Conservative leader Angela Merkel gives a press conference at her Christian Democratic Union (CDU) party's headquarters in Berlin.[AFP/file]

Merkel fought against Stoiber's wish to bring his trusted ally Horst Seehofer into the government because Seehofer has been a fierce critic of the conservatives' proposals to reform the health system.

Stoiber appears to have won the day, and Seehofer looks set to be appointed agriculture minister, sources close to the CSU said.

Arguments about who should fill the conservatives' roles raged all weekend, according to press reports.

Two candidates were in the running for defence ministry.

With Seehofer set to take the agriculture job, Michael Glos, the head of the CSU's parliamentary group, may miss out as his party will only take two cabinet posts.

The most likely choice now is Franz Josef Jung, a leading member of the Christian Democrat government in the central state of Hesse.

The interior ministry is more clearcut, with Wolfgang Schaeuble, a confidant of conservative former chancellor Helmut Kohl, returning to the job he occupied from 1989 to 1991 to add some much-needed experience to the cabinet.

Merkel has dismissed fears that her administration will get bogged down in inter-party squabbles.

"I see a spirit of camaraderie in this new government," she told Monday's issue of Der Spiegel magazine.

Schroeder will play no role in the new administration, yet many observers saw his influence in the line-up of Social Democrat (SPD) ministers named last week.

They included Schroeder's former right-hand man, Frank-Walter Steinmeier, as foreign minister, and Peer Steinbrueck, the former premier of the state of North Rhine-Westphalia, as finance minister. SPD party leader Franz Muentefering, another Schroeder ally, will be vice-chancellor.

The negotiations on the government's programme could take four weeks and the cabinet may not be sworn in until mid-November.

There are signs Merkel has agreed to water down her more radical proposals to boost the economy, such as cutting employers' costs. With the Social Democrats watching her every move, she is expected to be forced into constant compromise.

The conservatives have identified four issues that must be agreed on in the negotiations -- a new budget, reviving the labour market and the welfare system and introducing tax reforms to promote economic growth.

The first so-called grand coalition government in Germany since the 1960s will take office with a mandate to cut an unemployment rate which is currently stuck above 11 percent.

The economy is hardly growing and faces intense competition from low-cost eastern European neighbours.