Chancellor-designate Angela Merkel will have only limited authority in Germany’s planned left-right government, leaders of its two main parties said, as they prepared today for the start of full-blown coalition negotiations.

Conservative challenger Angela Merkel is still pressing hard to replace Gerhard Schroeder as chancellor of Germany after the two opponents held another meeting to try to hammer out a coalition accord.

CONSERVATIVE leader Angela Merkel pushed her demand to serve as Germany’s next chancellor while Gerhard Schroeder clung to his competing claim as they readied today for tough negotiations aimed at ending the country’s political crisis.

CHANCELLOR Gerhard Schroeder yesterday signalled he may be ready to relinquish power two weeks after Germany’s most inconclusive post-war election, saying he would accept any decision his party takes.

German Chancellor Gerhard Schroeder and conservative challenger Angela Merkel have held talks that both sides called helpful – but they did not resolve their dispute over who should be the country’s next leader.

GERMANY slid into political chaos yesterday after an inconclusive election left chancellor Gerhard Schroeder and his challenger Angela Merkel wrestling for the right to form a new government.

The chairman of German Chancellor Gerhard Schroeder’s Social Democrats today suggested that national elections should be brought forward by a year after the party suffered a stinging defeat in the country’s most populous state.

German Chancellor Gerhard Schroeder hopes to quell persistent dissent over his efforts to trim the generous welfare state by handing over the leadership of his governing Social Democratic Party today.

German Chancellor Gerhard Schroeder is stepping aside as chairman of his Social Democratic Party, a move that comes amid stubbornly low poll ratings and squabbling over the government’s future reform course.

The outcome of Germany's election is still not known as Chancellor Gerhard Schroeder and his conservative challenger Edmund Stoiber ran neck-and-neck tonight in one of the country's closest post-war elections.

A top aide to German Chancellor Gerhard Schroeder today defended the justice minister who compared President George Bush to Adolf Hitler.