Merkel Reclaims Role of EU Anchor in Outline of 2018 Agenda

(Bloomberg) -- German Chancellor Angela Merkel said she'll team up with France to hold the European Union together and pledged to form her next government “without delay.”

In a New Year's Eve speech to the nation, Merkel outlined a vision for her fourth term that includes an alliance with French President Emmanuel Macron to strengthen Europe's economic clout and control migration, while upholding values of tolerance and pluralism within the EU and abroad.

“Twenty-seven countries in Europe must be impelled more strongly than ever to remain a community,” Merkel said in a copy of the speech provided by her office in advance of the televised address on Sunday. “That will be the decisive question of the next few years. Germany and France want to work together to make it succeed.”

Merkel's effort to combine the strengths of the euro area's two biggest economies has been hamstrung by Germany's longest post-election party deadlock since World War II, which has left her a caretaker chancellor since September. Exploratory talks on renewing her coalition with the Social Democratic Party begin on Jan. 7.

‘Stable Government'

The chancellor sought to put her stamp on the political debate after a poll this week suggested Germans increasingly don't want her to serve another full term. Merkel, 63, said she's committed to forming “a stable government for Germany without delay in the new year.”

That's likely to be more difficult than in the past, especially after Merkel's attempt to create a coalition with the Free Democratic Party and the Greens collapsed. After serving as Merkel's junior partner for eight of her 12 years in office, the Social Democrats slumped to a postwar low in the German election in September.

Wolfgang Schaeuble, Merkel's former finance minister who's now president of the German lower house, told the Tagesspiegel newspaper that while a stable alliance with the SPD is preferable, governing without a parliamentary majority would be an option if talks with the SPD fail.

Read more: Why Germany's powerful finance post is back in play

Looking back on a year that brought a far-right party into parliament for the first time since the 1950s, Merkel acknowledged a growing divide between the winners of Germany's economic boom and those left behind who she said worry about crime, violence and migration.

“Both are realities in our country: success and confidence, but also fears and doubts,” Merkel said. “Both are sources of motivation for me.”

More than half of the supporters of both Merkel's Christian Democrat-led bloc and the SPD expect them to agree on another “grand coalition” of the two biggest parties, according to a Dec. 19-21 YouGov poll published Wednesday. Even so, 47 percent said they want Merkel to step down before the end of the four-year mandate her party won in September, compared with 36 percent in October.

Read more: Why Merkel's critics are floating a minority government

A Civey poll for Die Welt newspaper published Saturday suggested 46 percent of Germans want Merkel to quit immediately. That level of opposition to a fourth term for the chancellor broadly matches poll numbers in late 2015, at the height of the refugee crisis, and last year.

Merkel's CDU-CSU bloc won the election with 32.9 percent of the vote, its lowest share since 1949. The Social Democrats, the second-biggest party, fell to 20.5 percent.

To contact the reporter on this story: Rainer Buergin in Berlin at rbuergin1@bloomberg.net.

To contact the editors responsible for this story: Alan Crawford at acrawford6@bloomberg.net, Tony Czuczka, Ros Krasny

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