BERLIN (Reuters) -Germany\u2019s Social Democrats said on Monday they would start the process of trying to forge a three-way alliance and lead a government for the first time since 2005 after they narrowly won Sunday\u2019s national election.<\/p>\n
The Social Democrats’ chancellor candidate, Olaf Scholz here said he aimed to build a coalition with the Greens and the liberal Free Democrats (FDP), saying Germans had voted to send Angela Merkel’s conservatives into opposition after 16 years in power.<\/p>\n
\u201cWhat you see here is a very happy SPD,\u201d Scholz, 63, told cheering supporters at his party\u2019s headquarters in Berlin, clutching a bunch of red and white flowers.<\/p>\n
\u201cThe voters have very clearly spoken… They strengthened three parties – the Social Democrats, Greens and FDP – and therefore that is the clear mandate the citizens of this country have given – these three should form the next government.\u201d<\/p>\n
The SPD won 25.7% of the vote, ahead of 24.1% for Merkel\u2019s CDU\/CSU conservative bloc, according to provisional results. The Greens came in at 14.8% and the FDP were on 11.5%.<\/p>\n
The SPD’s recovery marks a tentative revival for centre-left parties in parts of Europe, following the election of Democrat Joe Biden as U.S. president in 2020. Norway’s here centre-left opposition party also won an election earlier this month.<\/p>\n
Scholz, who was finance minister in Merkel\u2019s outgoing \u2018grand coalition\u2019, said on Sunday he hoped to agree a coalition before Christmas. But his Christian Democrat rival Armin Laschet, 60, said he could still try to form a government despite leading the conservatives to their worst ever election result.<\/p> Merkel, who did not seek a fifth term as chancellor, will stay on in a caretaker role during the coalition negotiations reut.rs\/2ZeqYw3 that will set the future course of Europe’s largest economy.<\/p>\n German shares rose on Monday, with investors pleased that the pro-business FDP looked likely to join the next government while the far-left Linke failed to win enough votes to be considered as a coalition partner.<\/p>\n \u201cFrom a market perspective, it should be good news that a left-wing coalition is mathematically impossible,\u201d said Jens-Oliver Niklasch, LBBW economist, adding that other parties had enough in common to find a working compromise.<\/p>\n \u201cPersonalities and ministerial positions will probably be more important in the end than policies.\u201d<\/p>\n The parties will start sounding each other out on Monday about possible alliances in informal discussions.<\/p> The Greens and FDP said late on Sunday they would first talk to each other to seek areas of compromise before starting negotiations with either the SPD or the conservatives.<\/p>\n If Scholz succeeds in forming a coalition, the former mayor of Hamburg would become only the fourth post-World War Two SPD chancellor and the first since Merkel took over from Gerhard Schroeder in 2005.<\/p>\n Merkel has stood large on the European stage since then – when George W. Bush was U.S. president, Jacques Chirac was French leader and Tony Blair the British prime minister.<\/p>\n But Berlin\u2019s allies in Europe and beyond will probably have to wait months before they can see how the new German government will engage on international issues.<\/p>\n Assuming Scholz can agree a deal with the Greens and the FDP, the Greens could provide the foreign minister, as they did with Joschka Fischer in their previous two-way alliance with the SPD, while the FDP has its eyes on the finance ministry.<\/p>\n A row between Washington and Paris over a deal for Australia to buy U.S. instead of French submarines has put Germany in an awkward spot between allies, but also gives Berlin a chance to heal relations and help rethink a common Western stance on China.<\/p>\n On economic policy, French President Emmanuel Macron is eager to forge a common European fiscal policy, which the Greens support but the CDU\/CSU and FDP reject. The Greens also want “a massive expansion offensive for renewables reut.rs\/2T1UKS3”.<\/p>\n One thing is certain: the future government will not include the far-right Alternative for Germany (AfD), which scored 10.3% on Sunday, down from 12.6% four years ago when they stormed into the national parliament for the first time. All mainstream politicians rule out a coalition with the party.<\/p>\nINVESTOR RELIEF<\/h2>\n