A LEADER OF one of the three parties holding talks on forming a new German government has said the discussions have “a long way to go” and will have to bridge significant policy differences.

The centre-left Social Democrats, the environmentalist Greens and the pro-business Free Democrats held their first round of talks on Thursday on a possible coalition.

If they eventually succeed, the alliance would send outgoing chancellor Angela Merkel’s centre-right Union bloc into opposition after her 16 years at the helm of Europe’s biggest economy.

More talks are scheduled for Monday and Tuesday, but the process of putting together a new government can take weeks or months in Germany, and Merkel’s outgoing government will stay in office in the meantime.

Robert Habeck, one of the Greens’ two leaders, told Deutschlandfunk radio: “We have a long way to go, and it will get very arduous.

“And the public will see that there are some conflicts between the possible coalition partners.”

Habeck identified finance as a particularly difficult issue in the talks — including how to fund investments in fighting climate change and approaches for dealing with the debt European countries have run up during the coronavirus pandemic.

In recent decades, the Free Democrats mostly allied with the Union, while the Greens traditionally lean left. A three-way alliance with the Social Democrats has been tried successfully in Germany at the state level, but not yet in a national government.

If the negotiations result in a coalition, Social Democrat Olaf Scholz — the vice chancellor in Merkel’s outgoing government — would become Germany’s new leader.

The Union is in turmoil after Armin Laschet, the governor of North Rhine-Westphalia state, led the two-party bloc to its worst-ever election result on September 26.

Speculation about who will take over the leadership of Merkel’s Christian Democratic Union, the dominant party, is in full swing after  Laschet indicated his willingness to step aside.