Friedrich Merz's CDU/CSU bloc and the Social Democrats (SPD) of defeated Chancellor Olaf Scholz on Saturday announced they had wrapped up exploratory talks and would now move onto the next, decisive stage of full-fledged coalition negotiations.
"We concluded the consultations between CDU/CSU and SPD and we have drawn up a joint exploratory paper," Merz said.
The parties' 11-page exploratory paper gives a taster on what can be expected from the future government. So what does this mean for key issues like migration, work and social care, and the economy?
Migration
According to the paper, the citizenship law reformed by the traffic light coalition will remain in place, so citizens will still be able to hold multiple nationalities. The shortened waiting times for naturalisation and dual citizenship for non-EU citizens will also remain unchanged.
Foreign residents in Germany can apply to become German after five years – or three years in some cases – following the overhaul by the previous government.
The law passed in 2024 allows everyone naturalising as German to hold multiple nationalities whereas previously only EU citizens or those who fell into an exception category could keep their origin nationality. The law change also benefits Germans by allowing them to keep their nationality when gaining a citizenship abroad (if their host country allows it).
But the Union got its way on the asylum issue: those who apply for asylum in future will be turned away at the borders.
Additional police officers will be needed for these land border checks, which the parties say will be carried out "in coordination with" neighbouring countries, although there are no details on what this may look like or how those countries may react.
READ ALSO: Germany's asylum seekers anxious over Merz's plans
This is a change from the current position. While Interior Minister Nancy Faeser has been gradually ordering checks for all German land borders in recent years, generally, anyone who wanted to apply for asylum was still allowed in.
The paper also sets out that the reunification of family members of those with subsidiary protection status will be suspended, but no timeframe has been specified for this yet.
And there will be a so-called 'repatriation offensive' (Rückführungsoffensive) with no compulsory legal representation for deportations.
Work and social affairs
Germany should be able to achieve a minimum wage of €15 per hour in 2026, according to the paper.
Some businesses have already spoken out against this increase, with the German Farmers' Association president Joachim Rukwied saying this would prevent fruit, vegetable and wine growing from being competitive in Germany, AFP reported.
Those who choose to continue to work past the retirement age should be able to earn up to €2,000 a month tax-free, the paper states.
People should have the option to have a weekly maximum working time rather than a daily one: "To make overtime pay off, bonuses for overtime that go beyond the full-time work agreed in a collective agreement or based on collective agreements will be tax-free."
The 'mothers' pension' (Mütterrente) will be increased: for children born before 1992, three years of parental leave will be credited towards the pension, up from the previous two-and-a-half year maximum.
The parties also want to revamp the citizen's allowance system (Bürgergeldsystem) to create "a basic income for job-seekers". But for those who are able to work and repeatedly refuse "reasonable work", benefits will be withdrawn, the CDU's Friedrich Merz said.
A "major care reform" is also planned to deal with the billions of euros of still-rising costs in this sector.
Economy
Electricity tax will be reduced to the minimum EU-permitted level to cut costs for both companies and private homes, saving at least five cents per kilowatt hour. The parties also want to halve transmission network charges, which form part of power prices.
The tax burden will be reduced for the "broad middle class", according to the paper, with planned income tax reforms. The commuter allowance in the tax return will also be increased.
The parties plan to encourage electric car purchases with a "purchase incentive". The traffic light coalition stopped the subsidies for e-cars at the end of 2023 because of budget constraints, leading to a sharp drop in demand.
Eating out may be cheaper in future as the paper details plans to cut the sales tax for food in restaurants to seven percent permanently (from 19 percent currently) – the same level it was reduced to temporarily during the pandemic.
What else?
But many questions remain unanswered by the exploratory document, not least around issues, such as cost-cutting and the areas that could be affected as part of "plans to make savings as part of budget discussions"; the future of the controversial heating law, which the CDU wanted to reverse; and nuclear power plant decommissioning plans.
Similarly, there is little mention of foreign and security policy in the paper, so the future of arms deliveries to Ukraine, possible conscription, and Germany's views on a European peacekeeping force for the country, for example, remain uncertain.
READ ALSO: Conservatives float plans to bring back military service in Germany
Businesses in Germany reacted positively overall to Saturday's agreement.
"The rapid conclusion of the exploratory talks corresponds to the expectations of the business world of quickly establishing a government capable of taking action," Jörg Dittrich, President of the German Confederation of Skilled Trades (ZDH) told AFP.
The talks took place less than two weeks after the February 23rd elections.
Dittrich particularly welcomed the planned reductions in bureaucracy, taxes and energy costs, but said "the urgently needed realignment of the social security systems" was lacking.
The top committees from the CSU and SPD want to discuss the results from the exploratory paper on Sunday with the CDU having talks on Monday. Once these are over, coalition negotiations can begin.
Merz wants everything tied up by Easter, putting an end to six months of political paralysis, but the SPD has not yet commented on a specific timeline.
With additional reporting from AFP
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