(RFE/RL) -- With German Chancellor Angela Merkel back in the saddle after her win in September 27 parliamentary elections, the coming days will be devoted to forging a coalition between her centrist Christian Democrat (CDU-CSU) bloc and the right-of-center Free Democrats (FDP).
The Free Democrats, under their leader Guido Westerwelle, want to press on with their program of economic reform. But Merkel is seen as none too enthusiastic for major changes, despite the fact that her Christian Democrats and the pro-business Free Democrats would seem to be natural partners.
Both parties are conservative, have deeply rooted ideas in favor of private initiative, and have strong links to Germany's businesss and industrial communities. In addition, they already have experience with one another, having been together in ruling coalitions in previous years.
Guido Westerwelle, the forceful young FDP leader, is eager to get on with forming a new government.
"Talks will start this week, in any case preliminary talks, for the formal coalition negotiations," he told journalists in Berlin on September 28. "I am attending a one-on-one discussion this afternoon with the chairwoman of the CDU [Merkel], and this will obviously concern timetables and further questions, which we have to begin to discuss.
"I presume that the CDU will also have used its committee meeting to discuss essential questions among themselves, so that they can discuss and negotiate with us."
Westerwelle is in a strong position. The FDP gathered 15 percent of the vote, its highest electoral result ever.
Most of those votes probably came from disenchanted CDU-CSU supporters, tired of the policies emerging from the the outgoing government, which was a "grand coalition" between Merkel's bloc and their natural rivals, the Social Democrats (SPD).
On the other hand, Merkel is in a comparatively weak position. The CDU-CSU emerged as the biggest entity, with some 34 percent of the vote, but that is actually one of its worst showings ever.
Westerwelle recognizes this.
"It is clear for us that our program will be our compass in these negotiations. This is why people voted for us and, of course, we want to enforce as much of this as possible in fair negotiations, because this program is the best policy that can be done for Germany. We also insist on this," he said.
"We are also convinced that contradictions are being created that are completely false. Our economic policy is the best policy for employees that can be made, as it creates training and jobs."
The FDP campaigned on a program of quick and massive tax cuts, less government spending, privatization of state holdings, and increased flexibility in hiring and firing workers.
This is a program Merkel might have advocated herself four years ago. But having spent the subsequent time in coalition with the SPD, she appears to have mellowed.
She has made clear that she sees the CDU-CSU as the major partner in the prospective coalition and has indicated that she does not see herself moving far to the right. She now stands for gradual reform, rather than the clean sweep favored by the FDP.
The head of the German Institute for Economic Research, Klaus Zimmerman, says the new coalition has a difficult path to tread -- between coherent action and maintaining stability.
"The economy itself will see this [election result] as a call for more action - everything which was put off in the last legislation period, such as dealing with the consequences of demographic developments, an aging population, changes in the labor market and the need for more trained people," Zimmerman says.
"But on the other hand, we also need a stable system of social security which is acceptable in the long-term. The new government is facing a lot of demands."
World leaders have congratulated Merkel on her reelection. But Turkish media are saying that her continued presence will create difficulties for Turkey' bid to join the European Union.
The chancellor has long advocated a form of "privileged partnership" with Turkey instead of EU membership. Now, with the SPD gone, Turkey loses a voice in the cabinet.