SPD leadership transition drags out, threatens Germany's new coalition government

Germany's Schulz steps down to ease tensions within SPD

Speaking to Germany's Funke media group, Gabriel said he felt that while "in the eyes of the public I have clearly carried out my duties very well and successfully ..."

Nahles, 47, shot to national political fame during the fraught days of the last SPD government 15 years ago when, as a left-wing lawmaker, she helped lead a party rebellion against its tough social reforms.

With many SPD rank and file harboring misgivings about sharing power with Merkel again, the result of the vote, due on March 4, is wide open.

The resignation of Schulz is a major blow to the stability of the already fragile grand coalition for Chancellor Angela Merkel, who failed to form a coalition government with the libertarian Free Democrats and the Green Party back in November.

Michael Mueller, head of the SPD in Berlin and mayor of the German capital, told the newspaper "Berliner Morgenpost" that he did not reject Nahles' candidacy for the leadership as such, but was in favor of a "clean process" as established by the party constitution.

The leader of the SPD's youth wing is travelling around Germany urging the party's 464,000 members to vote against the deal in the postal ballot.

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The new governance agreement, however, is yet to be voted on by party members.

Scholz and Nahles thanked Schulz for his leadership of the party.

Schulz, 62, ditched plans to take the post of foreign minister after fierce criticism from some former allies, not least because he had pledged not to serve in a cabinet with Merkel.

Schulz is expected to take a seat on the SPD's backbenches.

An INSA poll published on Tuesday showed the SPD at a record low of 16.5 percent, only 1.5 percentage points ahead of the far-right Alternative for Germany (AfD). Juso leader Kevin Kuehnert has expressed concerns that the SPD would be electorally marginalized during another term as junior partner to the Christian Democratic Union (CDU) and Christian Social Union (CSU), calling for the renewal of German social democracy in opposition. Last Wednesday, the SPD reached an agreement with Merkel's Union in formal government coalition negotiations, a move likely to end the longest ever new government vacuum after the September 24 federal elections.

The chairman of the Association of Social Democratic Lawyers in the SPD, Harald Baumann-Hasske, also brought up the legality of appointing a new chair, per the party's charter.

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