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Merkel Meets State Leaders on Fiscal Pact, Sueddeutsche Reports

German Chancellor Angela Merkel will meet the country’s state premiers today to try to break an impasse on Europe’s fiscal pact caused by clashes over budgets, Sueddeutsche Zeitung reported, without citing anyone.

North Rhine-Westphalia and Rhineland-Palatinate are leading states that want the federal government to gradually assume an annual 12.5 billion euros ($15.7 billion) in aid for disabled people currently paid by municipalities and to temporarily allow German states to run higher budget deficits, the Munich-based newspaper said.

While German Finance Minister Wolfgang Schaeuble opposes those demands, failure to meet them could delay approval of the fiscal pact in the upper house of parliament rather than cause it to fail, Sueddeutsche reported, citing unidentified people close to governments in states run by the opposition Social Democratic Party.

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