Germany's two main political parties have reached a deal that will make conservative leader Angela Merkel the country's first female chancellor.
Officials of Ms. Merkel's Christian Democratic Union and Chancellor Gerhard Schroeder's Social Democratic Party say they agreed on the deal Monday after three weeks of talks on forming a power-sharing government.
German media say that in exchange for Mr. Schroeder's stepping aside, his party will have two more seats in the cabinet than Ms. Merkel's. Mr. Schroeder has been Germany's chancellor for nearly eight years. It is not clear what role, if any, he will play in Ms. Merkel's government.
The two parties reluctantly began trying to form a coalition government after the September 18 parliamentary elections failed to produce a clear mandate for either party.
Ms. Merkel's government will face the task of leading Germany away from record unemployment, and strengthening its stagnant economy.
Some information for this report provided by AFP and Reuters.