BERLIN 

Coalition talks between Germany’s Christian Democrats (CDU/CSU) and the Social Democratic Party (SPD) have entered their “final stretch,” negotiators announced Tuesday.

CDU/CSU parliamentary group leader Thorsten Frei reported significant progress on key policy issues, including tax policy, though he declined to share details while negotiations continue.

“I would say we're now in the final stretch,” Frei told public broadcaster ARD ahead of talks at CDU party headquarters in Berlin. “’I can’t say exactly how far we have left, but we're making good progress,” he added.

Senior SPD politician Anke Rehlinger expressed optimism about reaching an agreement, saying negotiations are progressing well. “The last few meters are the most challenging, but I’m confident that the efforts will be worthwhile,” she told reporters at CDU headquarters.

According to Bild daily, conservative leader Friedrich Merz canceled his attendance at his party's youth organization reception to take part in tonight's negotiations aimed at resolving outstanding economic policy issues. The newspaper reported that if the meeting produces an agreement, the new coalition deal could be presented as early as Wednesday.

After reaching an agreement, the draft coalition deal must be approved by relevant party bodies and delegates. The SPD plans to hold a membership-wide vote, while the Christian Democrats will decide through a small party conference. Following approval, the German parliament could elect Merz the new chancellor on May 7.

In Germany's February snap elections, Merz's CDU/CSU alliance secured a clear victory with 28.5% of the vote, though falling short of an outright majority.

The Social Democrats got their lowest historical result at 16.4% but have emerged as a crucial coalition partner. Together, the two parties would command 328 seats in the Bundestag – well above the 316 seats needed for a governing majority.