HARD-WON RESULTS

SPD chief Sigmar Gabriel has worked hard to convince his party members to support the left-right government as he won key concessions from Merkel's camp on SPD's core concerns and centerpiece policies during the coalition talks.

During the coalition talks, the SPD insisted on the introduction of a national minimum wage of 8.50 euros (11.41 U.S. dollars) per hour, which was a key election platform. Although Merkel has repeatedly reiterated her opposition to the national minimum wage on concerns that it would destroy jobs, she finally gave in.

The national statutory minimum wage is scheduled to be introduced in Germany from January 2015. Merkel said earlier that she would try to prevent job losses that may be caused by the move.

Among other agreed policies proposed by the SPD, dual citizenship will be allowed for children who grew up in Germany and were born after 1990 to foreign parents. Currently they have to choose between German citizenship and that of their parents when they reach 23 years of age.

But the CDU held its ground as the parties agreed there should be no tax rises. The SPD had demanded to raise taxes on incomes above 100,000 euros to 49 percent from 42 percent. Merkel has said such tax hike plans would risk spoiling the good situation of the country's economy.

According to the coalition agreement, the new government will spend an additional 23 billion euros by 2017 without tax increases. The government will also not undertake new borrowing from 2015. The additional money will be invested in areas including infrastructure, education, research and development.

Other agreed policies included lower retirement age from 67 to 63 for those who made pension contribution for 45 years, and reforms of the current Renewable Energy Act.