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Germany’s Social Democrats are ready to talk to their conservative rivals about the formation of a new government led by Angela Merkel, in a potentially decisive move to break the political deadlock in Berlin.

“The SPD is firmly convinced that talks have to take place. The SPD is not closed to talks,” Hubertus Heil, the general secretary, said early on Friday. The decision marks a U-turn for the centre-left party, and was the result of an eight-hour meeting of SPD leaders at party headquarters in Berlin.

The SPD has yet to clarify whether it is prepared to enter into a new “grand coalition” with Ms Merkel’s Christian Democratic Union and its Bavarian sister party the Christian Social Union, or whether the party is at most ready to offer its support for a minority government led by the veteran chancellor.

Martin Schulz, SPD leader, had earlier held a closed-door meeting with President Frank-Walter Steinmeier, who has played a crucial role in pushing the Social Democrats towards talks with the chancellor.

Mr Steinmeier, himself a former SPD foreign minister, has repeatedly made clear that he wants to avoid new elections, and has urged party leaders on all sides to show flexibility and readiness to compromise.

For Mr Schulz, the decision to hold talks with the chancellor is an awkward one that could further damage his tarnished authority inside the party. On Monday he ruled out talks with the CDU — and in particular any move to revive the grand coalition. Mr Schulz also said the SPD was ready to go to new elections.

But his stance faced mounting criticism from both inside and outside the party in recent days, with a growing number of SPD officials saying they wanted negotiations.

On Thursday, more Social Democrats came out in favour of a minority government led by Ms Merkel, signalling the SPD’s readiness to back such an administration on key votes — for example on the budget or EU policy. But others made clear the SPD would also have to examine a return to the grand coalition.

“We will, if nothing else is possible, also have to think about a grand coalition,” said Karl Lauterbach, an SPD member of parliament, on Thursday.

Stefan Zierke, another SPD lawmaker and the spokesman for the party’s deputies from eastern Germany, said on Thursday: “If you want to implement projects, if you really want to move forward social democracy in Germany, then you have to be in government.”

On Wednesday Mr Schulz himself signalled the SPD might be ready to shift its stance, saying he was “fully aware of its responsibility in the current difficult situation”. He added: “I’m sure we will find a good solution for our country in the coming days and weeks.”

Despite the recent public pronouncement, many SPD leaders remain deeply reluctant to revive the idea of a cross-party coalition with Ms Merkel, pointing to the Social Democrats’ historic defeat at September’s general election. The debacle at the ballot box, in which the party won just 20.5 per cent of the vote, has been widely blamed on the decision to join the CDU-CSU as junior partners four years ago.

Sensing the change in the political climate, senior members of Ms Merkel’s party redoubled their efforts to bring the SPD back into the fold. Volker Kauder, head of the CDU-CSU group in parliament, told Germany’s Südwest Presse on Thursday that he would be happy “if the current partners in government found each other once again”. Mr Kauder pointed to the “special responsibility” of the country’s two biggest establishment parties.

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