New Merkel-led coalition takes office in Germany (Roundup)

Oct 28, 2009, 14:16 GMT

   Berlin - Germany's new conservative government was warned against 'unrealistic growth expectations' when it took office on Wednesday against a background of continuing economic uncertainty.

   'The global economy will recover only slowly from the current crisis,' President Horst Koehler told Chancellor Angela Merkel's new centre-right cabinet at a ceremony in Berlin.

   Koehler, a former head of the International Monetary Fund, said care was needed to find 'the correct dose of financial and economic measures to ensure that recovery continues and gains in strength.'

   At the same time he warned against 'unrealistic growth expectations' and urged the coalition to work towards reducing Germany's public debt of 1,600 billion euros (2,400 billion dollars).

   Merkel and her 16-member cabinet were sworn in for a four-year term, a month after her conservative Christian democrats (CDU) and pro-business Free Democrats (FDP) won a majority in a general election.

   Merkel received 323 votes from the 612 deputies present in the 622-member lower house, or Bundestag, where the coalition enjoys a comfortable majority.

   The ballot count showed Merkel received nine votes fewer than she would have expected from her coalition, which has a combined strength of 332 seats in the legislature.

   In one of her first acts as head of the new government, Merkel was scheduled to fly to Paris Wednesday evening for dinner and talks with French President Nicolas Sarkozy.

   On Thursday, she is due to attend the EU summit in Brussels, where FDP leader Guido Westerwelle will make his debut as German foreign minister.

EU Commission President Jose Manuel Barroso was one of the first leaders to congratulate Merkel and praised Germany's 'excellent cooperation' with the European Union.

   'I would like to thank you for your continuous commitment to the European idea and your active contribution to the integration of the enlarged European Union,' Barroso told the chancellor.

Russian President Dmitry Medvedev also congratulated Merkel and promised to attend the 20th anniversary celebrations of the fall of the Berlin Wall on November 9.

In a message to the chancellor, the Kremlin leader stressed that Russia hoped to continue its strategic partnership with Germany.

   The coalition agreement was signed into life on Monday after three weeks of tough negotiations. It enabled the Free Democrats to return to government after 11 years in opposition.

   The new government takes over from a CDU-led coalition with the Social Democrats, who suffered record losses in the September 27 general election.

   Merkel told her party that the proposals agreed with the FDP put emphasis on growth and would work to counter the economic crisis, but warned the country's future remained unpredictable.

   Key points of the coalition agreement are 24 billion euros (36 billion dollars) in tax cuts, an overhaul of health care funding and a reduction in compulsory military service from nine to six months.

Foreign policy pledges include plans to phase out Germany's naval deployment off the coast of Lebanon, where it forms part of a UN operation. The FDP also pushed through a proposal to continue 'open-ended' EU membership talks with Turkey.

Merkel, who grew up in communist East Germany, became Germany's first woman chancellor in 2005.