SPD denies 'green light' for new German government, but keeps options open

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Merkel's chief of staff Peter Altmaier has ruled out any forms of cooperation in parliament with the right-wing Alternative for Germany (AfD) less than two weeks after the Free Democratic Party (FDP) pulled out of coalition talks and with the Social Democratic Party (SPD) leader Martin Schulz saying he hasn't yet given the green light for a coalition with Merkel's conservative union and the allied Greens.

Schulz, Merkel and CSU leader Horst Seehofer on Thursday night held a meeting with German President Frank-Walter Steinmeier, who is trying his best to make Germany avoid snap elections - an occurrence if no new government can be formed.

In a Facebook Live appearance, Schulz mentioned other possible options for the next government, including a minority administration and a coalition that would include the conservatives, the SPD and the Greens.

Schultz had initially refused to consider another "grand coalition" with Merkel after a disastrous showing of the Social Democrats in the election on September 24, saying the Social Democrats needed to go into opposition. But they ultimately agreed to start talks about a rerun of the conservative coalition.

Merkel is facing the most serious political crisis since she assumed office 12 years ago after the breakdown of the government coalition exploratory talks on November 19.

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"We have a lot of options for building a government". "As before, I remain sceptical that you can do that by carrying on "business as usual" in a grand coalition".

The SPD's top brass will then present their recommendation to party rank and file during their congress from Thursday. "The fact we underlined today that we are prepared to enter such talks with the SPD shows that we're aiming to bring these talks to a successful conclusion".

"It's not automatic that there will be a new grand coalition", Schulz told reporters in Berlin.

Angela Merkel faces demands for sweeping European Union reform and further integration as the price of a new coalition government in Germany, it emerged on Friday.

In particular, he said he would demand German support for Emmanuel Macron's proposals for a Brussels-based finance minister and single budget for the Eurozone.