Merkel pays price to lead Germany

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BERLIN -- Conservative leader Angela Merkel was assured of becoming the country's first female leader yesterday when Chancellor Gerhard Schroeder bowed out during power-sharing talks that ended weeks of gridlock.

But the shy pastor's daughter from the former communist east paid a heavy price for power by giving Mr. Schroeder's center-left Social Democratic Party (SPD) control over eight ministries, including the key portfolios of foreign affairs, finance, justice and labor.

Her two-party conservative alliance will have the chancellor's office, a related ministry and six other Cabinet posts including the defense, economy and interior ministries, also for a total of eight.

The agreement, reached after a bitter power struggle caused by Mrs. Merkel's failure to win a convincing majority in Sept. 18 elections, means Germany will be governed by a "grand coalition" of conservatives and Social Democrats for the first time in almost four decades. The left-right coalition will command a total of 448 votes in the 614-seat parliament, the Bundestag.

Mrs. Merkel, 51, said both groupings, though bitter rivals during the election, were obliged for the sake of the country and their own political future to make a success of the new government.

"If we don't succeed together and deliver what people in this country want, then things will get very difficult for both parties," she said at a press conference where she announced the agreement.

Asked how she felt at becoming Germany's youngest chancellor, she smiled coyly before reverting to her customary formality. "Firstly, I feel good. Secondly, we have a lot of work to do. ... I am in a state of excited alertness."

Analysts said the compromise had robbed Mrs. Merkel of the chance to pursue the radical economic reform plans that had earned her comparisons to Britain's Margaret Thatcher.

They also predicted she would have trouble stamping her authority on the government, even within her own ranks. The economy ministry will be run by powerful Bavarian Gov. Edmund Stoiber, head of the conservative Christian Social Union party, who has often clashed with the new chancellor.

The change of government also left uncertainty over the direction of German foreign policy, with the SPD-led Foreign Ministry liable to limit any effort to move toward Washington on Iraq and other issues.

The departure of Mr. Schroeder, who had maintained close personal contacts with Presidents Vladimir Putin of Russia and Jacques Chirac of France, was meanwhile expected to lead to a softening of ties with those countries.

Mrs. Merkel gave little away yesterday. "I'm convinced good trans-Atlantic relations are an important task and in the German interest. That doesn't mean one has to agree on all issues but it means one should have a good relationship of trust," she said.

Apart from the appointment of Mr. Stoiber to be economy minister, there was no announcement who would get the other posts and SPD leader Franz Muenteferng said no decisions had been reached.

Mr. Schroeder made no public appearances but was reported to have said he would have no role in the new government.

Mrs. Merkel, a Protestant who trained as a physicist in communist East Germany, entered politics after the Berlin Wall came down in 1989 and was mentored by former Chancellor Helmut Kohl.

She showed resilience and shrewdness in rising through the ranks of the mainly Catholic, male-dominated Christian Democrat Union, and became CDU leader in 2000 at a time when the party was in the throes of a funding scandal.

Yet she has never been able to establish full control of a party in which many, especially the powerful state governors, view her with envy and suspicion.