German parties agree to form a new government after months of drift in Europe's biggest economy

BERLIN (AP) — German election winner Friedrich Merz sealed a deal Wednesday to form a new government that aims to spur economic growth, ramp up defense spending, take a tougher approach to migration and catch up on long-neglected modernization.

The agreement paves the way for new leadership in the 27-nation European Union's most populous member, which has Europe's biggest economy. It follows months of political drift and weeks of negotiations as the continent faces uncertainty over the Trump administration's sweeping tariffs and its commitment to European allies' defense.

Merz is on track to become Germany’s new leader in early May, replacing outgoing Chancellor Olaf Scholz.

The 69-year-old's two-party Union bloc emerged as the strongest force from Germany’s election on Feb. 23. Merz turned to the Social Democrats, Scholz’s center-left party, to put together a coalition with a parliamentary majority.

Before Merz can take the helm, the coalition deal needs approval in a ballot of the Social Democrats’ membership and by a convention on April 28 of Merz’s Christian Democratic Union party. Once those hurdles are cleared, the lower house of parliament — in which the allies have 328 of the 630 seats — can elect him as chancellor.

Merz said the deal is “a very strong and clear signal to the people of our country, and also a clear signal to our partners in the European Union: Germany is getting a government that is capable of acting and will act strongly.”

Asked about his message to the U.S. president, Merz replied: “The key message to Donald Trump is, Germany is back on track. Germany will fulfill the obligations in terms of defense and Germany is willing to strengthen their own competitiveness.” He added, "We will bring the European Union forward.”

The prospective coalition embarked on one big project before even reaching a deal to govern together. Last month, it pushed plans through parliament to enable higher defense spending by loosening strict rules on incurring debt, and to set up a huge infrastructure fund that’s aimed at boosting the stagnant economy.

That was an about-turn for Merz, whose party had spoken out against running up new debt before the election without entirely closing the door to future changes to Germany’s self-imposed “debt brake.”

Other measures in the agreement are more in line with what he campaigned for. The coalition aims to boost companies' investment and then cut corporate tax, make working overtime more attractive and cut electricity tax.

Merz, the opposition leader at the time, made reducing migration central to his election campaign. On Wednesday, he said the new government will suspend family reunions for many migrants, designate more “safe countries of origin,” launch a “return offensive” for rejected asylum-seekers and turn some people back at Germany's borders in consultation with neighbors.

It will also tighten a law passed by the outgoing government that eased the rules for gaining citizenship, scrapping the possibility for well-integrated applicants to get a German passport after three rather than five years of residence.

The new government will include a “digitization ministry” to modernize a country that still has a reputation for tangled bureaucracy and old-fashioned paperwork.

“Not everything has to be regulated down to the smallest detail,” said the Social Democrats' co-leader, Lars Klingbeil. “The diggers must work and the fax machines in our country must be thrown away. Our economy must grow.”

Merz said the coalition plans to reduce the size of the federal administration by 8% over its four-year term. But, referring to the United States' Department of Government Efficiency, he said it doesn't plan to do so by firing workers. “We're not hiring an Elon Musk here who will do it like they do in Washington,” he said. “We will do it ... sensibly, with a sense of proportion.”

The election took place seven months earlier than planned after Scholz’s unpopular coalition collapsed in November, three years into a term that was increasingly marred by infighting and widespread discontent. Germany, the 27-nation European Union’s most populous member, has been in political limbo since then.

The market turbulence caused by U.S. President Donald Trump’s announcement of sweeping tariffs added to pressure for Merz’s Union and the Social Democrats to bring their coalition talks to a conclusion. The tariffs threaten to add to the woes of an export-heavy economy that shrank for the past two years.

Another factor in the haste to reach an agreement was a decline for the Union in the opinion polls, showing support slipping from its election showing, while the far-right Alternative for Germany, which finished a strong second in February, gained as the political vacuum persisted.

“The political center in our country is in a position to solve the problems we face,” Merz said. Ministers will be named at a later date.

Markus Soeder, chairman of Bavarian's Christian Social Union party, Friedrich Merz, Christian Democratic Union party chairman and the Social Democratic Party co-leaders Lars Klingbeil, address the media after reaching an agreement between their parties on a coalition for a new German government at a news conference in Berlin, Germany, Wednesday, April 9, 2025. (AP Photo/Ebrahim Noroozi)

Markus Soeder, chairman of Bavarian's Christian Social Union party, Friedrich Merz, Christian Democratic Union party chairman and the Social Democratic Party co-leaders Lars Klingbeil and Saskia Esken, walk together after reaching an agreement between their parties on a coalition for a new German government at a news conference in Berlin, Germany, Wednesday, April 9, 2025. (AP Photo/Ebrahim Noroozi)

Markus Soeder, chairman of Bavarian's Christian Social Union party and Friedrich Merz, Christian Democratic Union party chairman, address the media after reaching an agreement between their parties on a coalition for a new German government at a news conference in Berlin, Germany, Wednesday, April 9, 2025. (AP Photo/Ebrahim Noroozi)

Friedrich Merz, Christian Democratic Union party chairman, drinks water during a press conference after reaching an agreement between their parties on a coalition for a new German government at a news conference in Berlin, Germany, Wednesday, April 9, 2025. (AP Photo/Ebrahim Noroozi)

Markus Soeder, chairman of Bavarian's Christian Social Union party and Friedrich Merz, Christian Democratic Union party chairman, shake hands after reaching an agreement between their parties on a coalition for a new German government at a news conference in Berlin, Germany, Wednesday, April 9, 2025. (AP Photo/Ebrahim Noroozi)

Friedrich Merz, Christian Democratic Union party chairman shakes hands with the Social Democratic Party co-leaders Lars Klingbeil, next to Markus Soeder, chairman of Bavarian's Christian Social Union party, after reaching an agreement between their parties on a coalition for a new German government at a news conference in Berlin, Germany, Wednesday, April 9, 2025. (AP Photo/Ebrahim Noroozi)

Markus Soeder, chairman of Bavarian¥s Christian Social Union party, Friedrich Merz, Christian Democratic Union party chairman and the Social Democratic Party co-leaders Lars Klingbeil and Saskia Esken, brief the media after reaching an agreement between their parties on a coalition for a new German government at a news conference in Berlin, Germany, Wednesday, April 9, 2025. (AP Photo/Markus Schreiber)

Markus Soeder, chairman of Bavarian's Christian Social Union party, Friedrich Merz, Christian Democratic Union party chairman and the Social Democratic Party co-leaders Lars Klingbeil and Saskia Esken, address the media after reaching an agreement between their parties on a coalition for a new German government at a news conference in Berlin, Germany, Wednesday, April 9, 2025. (AP Photo/Ebrahim Noroozi)

CDU leader Friedrich Merz, left, chairman of Bavarian Christian Social Union party Markus Soeder, center left, and the co-leaders of Germany's Social Democratic Party Lars Klingbeil, top right, and Saskia Esken arrive to attend coalition talks between SPD CDU/CSU at the SPD headquarters in Berlin, Friday March 28, 2025. (Odd Andersen/Pool via AP)

From left, Parliamentary Group Leader of the Bavarian conservative Christian Social Union (CSU) party Alexander Dobrindt, leader of Germany's Christian Democratic Union (CDU) Friedrich Merz and the co-leader of the Social Democratic Party (SPD) Saskia Esken prior to coalition talks between SPD CDU/CSU at the SPD headquarters in Berlin, Friday March 28, 2025. (Odd Andersen/Pool via AP)

Friedrich Merz, the leader of Germany's Christian Democratic Union CDU, left, and the co-leaders of the Social Democratic Party SPD, Lars Klingbeil, center, and Saskia Esken arrive to meet for talks on forming a coalition government at the SPD headquarters in Berlin, Friday March 28, 2025. (Odd Andersen/Pool via AP)

In a box office battle of the sequels, “The Devil Wears Prada 2” had the slight edge over “Mortal Kombat II” in North American theaters this weekend. According to studio estimates Sunday, “The Devil Wears Prada 2” earned a chart topping $43 million in its second weekend, while “Mortal Kombat II” took in $40 million in its first.

This weekend had wide variety of newcomers playing in wide release, including the family-friendly whodunnit “The Sheep Detectives” and a James Cameron co-directed Billie Eilish concert film.

But it was the holdover that triumphed. “The Devil Wears Prada 2,” which has grossed $433.2 million worldwide in its first 12 days in release, helped push The Walt Disney Studios over $2 billion globally for the year. It’s also surpassed the total grosses of the first film, which earned $327 million globally in 2006, not accounting for inflation.

“Mortal Kombat II” provided some gendered counterprogramming in the second weekend of Hollywood's summer movie season. Warner Bros. opened the movie in 3,503 locations where it drew a heavily male audience. According to PostTrak, 75% of the ticket buyers were men. “The Devil Wears Prada 2” had almost the exact opposite gender breakdown on its first weekend.

The first movie in this series, “Mortal Kombat,” was released simultaneously in theaters and on HBO Max in April 2021 as a part of Warner Bros.’ pandemic-era day-and-date strategy. Reviews have been mixed for the sequel, as was its B CinemaScore. It also earned $23 million from 78 markets internationally, adding up to a $63 million global debut.

“Michael” landed in third place in its third weekend with another $36.5 million over the weekend, down only 33% from last weekend. The Michael Jackson biopic has now earned $240.5 million in North America, surpassing the total domestic grosses of “Bohemian Rhapsody,” and $577.4 million globally.

Fourth place went to Amazon MGM Studios' “The Sheep Detectives” which brought in $15.9 million in its first weekend in 3,457 theaters. The quirky, all-ages murder mystery features a starry ensemble including Hugh Jackman, Emma Thompson and Nicholas Braun, as well as the voices of Julia Louis-Dreyfus, Bryan Cranston, Regina Hall and Patrick Stewart as the sheep who try to figure out who murdered their shepherd. Audiences gave it an A- CinemaScore. The movie cost a reported $75 million to produce.

Rounding out the top five was “Billie Eilish—Hit Me Hard & Soft: The Tour (Live in 3D)” an immersive concert experience which Cameron shared co-directing credits on with Eilish. Paramount released the movie in 2,613 theaters, where it earned $7.5 million in North America and $12.6 million internationally. The movie was very well reviewed by critics (93% on Rotten Tomatoes) and audiences, who gave it an A CinemaScore.

James Cameron, left, and Billie Eilish pose for photographers upon arrival a the screening of the film 'Hit me Hard and Soft: The Tour' on Tuesday, April 28, 2026, in London. (Photo by Scott A Garfitt/Invision/AP)

Martyn Ford, from left, Tati Gabrielle, Adeline Rudolph, Lewis Tan and Mehcad Brooks pose for photographers upon arrival at the European Fan Event of the film 'Mortal Kombat II' on Thursday, April 30, 2026, in London. (Photo by Scott A Garfitt/Invision/AP)