German Chancellor Friedrich Merz on Thursday pleaded for a breakthrough in tough negotiations over the government's package of social reforms.
"Either we shy away from changes, changes that initially involve restrictions," Merz said in a major address to lawmakers in the Bundestag, Germany's lower house of parliament. "Or we harness the strengths and potential we have to turn things around for everyone and reposition ourselves more effectively in all areas where this is needed."
Merz's administration - a coalition between his conservative bloc and the centre-left Social Democrats (SPD) - has struggled in recent weeks to agree on several key issues, including reforms to the labour market, social policy, taxes and cuts to bureaucracy.
Polls have shown the coalition parties sliding for months ahead of a trio of important state elections in September, with Merz's approval ratings plunging amid mounting frustration at the government's failure to turn around the struggling German economy.
On Wednesday, the chancellor convened a summit with top business and labour representatives at the Chancellery in Berlin, kickstarting a final push to secure an agreement before lawmakers leave the capital for the summer break on July 10.
As expected, the meeting ended without any significant progress, but the "lengthy discussion" took place in a "very positive and constructive atmosphere," Merz said, adding that the parties agreed to continue talks.
