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Germany faces a long period of uncertainty after talks on forming a new government broke down late on Sunday night. Angela Merkel, chancellor, was trying to form a coalition between her conservative bloc, the liberal Free Democratic party and the environmental Greens.

But the parties were deeply divided over issues ranging from how to tackle climate change to refugee policy. After exploratory talks dragged on for more than a month the FDP quit, saying the sides had failed to overcome their differences.

What happens now?

Frank-Walter Steinmeier, the German president, will play a crucial role and will meet Ms Merkel later on Monday. Under the constitution, the head of state is the person who ultimately decides whether Germany should hold new elections, which may be the only option available.

The decision on whether Germany should hold new elections ultimately resides in German president Frank-Walter Steinmeier © Getty

What are the options?

There are basically three. Ms Merkel can change tack and seek instead to continue the “grand coalition” between her conservative bloc and the Social Democrats (SPD), which held power until September’s election. Failing that, she could try to run a minority government, which might have support from one smaller party but would not command a majority in the Bundestag. And if neither of those scenarios is possible or palatable, Germany could be heading for fresh elections.

How likely is a ‘grand coalition’?

A grand coalition would easily command a parliamentary majority, even after both the SPD and the CDU lost ground in the September election. But the election was viewed by the SPD as a disaster — it won barely one-fifth of the national vote, its worst result since 1949 — and the party, run by Martin Schulz, has categorically ruled out going into government again.

The pressure might now grow on it to change its mind, but it is unlikely to do so — although one senior SPD figure, Thomas Oppermann, said after the elections in September that a grand coalition would only work if Ms Merkel stepped down. In such a scenario, a key question would be who from the Christian Democrats the SPD might be prepared to work with.

The Social Democratic party, headed by Martin Schulz, has ruled out going into a coalition government

Could a minority government work?

Technically yes, although few parties like the idea. Thomas Kreuzer of the CSU, part of Ms Merkel’s conservative bloc and one of the negotiators in the coalition talks, said a minority government would lack the authority that Germany and the EU badly need at the present time. Ms Merkel said on the night of the election that she would not favour such an option, and the SPD also made clear it would not “tolerate” a Merkel-led minority government.

How could we get to new elections?

The path to a new election is not straightforward, and first of all requires voting by the members of the Bundestag elected in September.

Germany’s chancellor is not directly elected in a national vote. Instead under Article 63 of Germany’s basic law the president nominates the chancellor, usually the candidate of the strongest group in parliament. He or she is then elected to office upon winning a majority of members of the Bundestag, the German parliament. All of Germany’s postwar chancellors attained office in this way, supported of course by having held successful coalition talks.

Now we are in a position where Ms Merkel cannot guarantee that support. In such a situation the constitution would require further votes. The first, within 14 days, would allow a candidate to become chancellor with a majority of votes in parliament. Failing that, a third vote would be held in which the candidate with the most votes could become chancellor. The president must then decide whether to appoint this person — potentially leaving them to try to run a minority government — or to dissolve the Bundestag.

What will happen if new elections are held?

Many commentators say they could easily play into the hands of the Alternative for Germany (AfD), a rightwing populist party that won 13 per cent in the Bundestag election and has thrived on popular dissatisfaction with the established parties. The breakdown of the coalition talks will vindicate the AfD’s claim that Germany’s political system is broken and needs radical solutions to fix it.

The FDP, led by Christian Lindner, considers it has least to fear from new elections, and that it could pick up support from disgruntled conservative and AfD voters.

But some commentators have suggested that this could backfire against the FDP, which might be blamed by many voters for the breakdown of the “Jamaica” talks — so called because the parties’ colours match those of the Caribbean nation’s flag. Jürgen Trittin, a Green leader, said the FDP’s calculation could turn out to be a “cruel mistake”.

The FDP, led by Christian Lindner, believes it has least to fear from new elections © AP

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