According to the Reuters news agency, citing the German coalition paper, CDU/CSU bloc and the SPD party have agreed to boost the country's contribution to the EU budget, devoting specific funds for economic stabilization, social convergence and structural reform support in the Eurozone.
As the document explains, these funds can lay the foundation for a future "investment budget" in the Eurozone.
The latest round of coalition talks between German Chancellor Angela Merkel's Alliance of Christian Democratic Union, Christian Social Union (CDU/CSU) and the Social Democratic Party (SPD) led by former EU Parliament President Martin Schulz has resulted in a breakthrough after the two sides agreed on a document to form a coalition government, German newspaper Die Welt reported Friday, citing sources familiar with the matter.
Early on Thursday, Schulz and Merkel said that they were going to finish talks on building a coalition. The talks, however, lasted until to Friday morning.
The paper, on which the two sides agreed, has to be approved by the coalition talks groups in each party, the newspaper said.
Among the stumbling blocks that hampered the talks was the issue of migrant family reunifications. Merkel's bloc, especially the CSU, insists on further suspension of the process fearing the further growth of support for the right-wing Alternative for Germany Party (AfD), while the SPD calls for lifting of the suspension allowing at least 40,000 people to come to Germany as part of the program on reunification with their family members.
However, the parties managed to reach an agreement on yearly limits for refugee arrivals in Germany, according to the DPA news agency, defining the desired limit on the number of refugees coming to Germany stays within the range of 180,000-220,000 per year.
The document also specified that the family reunification process should remain suspended until the new regulation is adopted and then restricted to 1,000 people per month.
Another issue, which triggered disputes, was the SPD-suggested tax increase for the richest citizens from 42 percent to 45 percent. Social Democrats need the tax increase to fund their policies, which include more spending on education, social housing and healthcare, including the introduction of a universal health care insurance.
Merkel's bloc does not support the SPD's ideas and, in turn, proposes an increase of military spending in the framework of NATO member states' agreement to spend 2 percent of the GDP on the military, which the SPD opposes. The problem is that the announced budget for the implementation of government policies amounts to 45 billion euros ($54.2 billion) and the proposals by the parties are two times as large as the budget.
CDU/CSU and SPD agreed to launch coalition talks in late November after the failure of negotiations between Merkel’s bloc, the Free Liberal Party (FDP) and The Greens party in late November.