German parties agree to form new govt

Berlin: German election winner Friedrich Merz sealed a deal on Wednesday to form a new government that aims to spur economic growth, ramp up defence spending, take a tougher approach to migration and catch up on long-neglected modernisation.

The agreement paves the way for new leadership in the 27-nation European Union’s most populous member, which has Europe’s biggest economy.

It follows months of political drift and weeks of negotiations as the continent faces uncertainty over the Trump administration’s sweeping tariffs and its commitment to European allies’ defence.

Merz is on track to become Germany’s new leader in early May, replacing outgoing Chancellor Olaf Scholz.

The 69-year-old’s two-party Union bloc emerged as the strongest force on February 23. Merz turned to the Social Democrats, Scholz’s center-left party, to put together a coalition with a parliamentary majority.

The coalition deal needs approval in a ballot of the Social Democrats’

membership.