Germany's conservative leader clinches an major financial agreement ahead of a crunch vote in parliament.

German Chancellor-in-waiting Friedrich Merz said on Friday he had secured the crucial backing of the Greens for a massive increase in state borrowing, clearing the way for the outgoing parliament to approve the historic deal next week.

German conservative leader Friedrich Merz reached an agreement with the Green party on a debt-funded spending package for defense and infrastructure, overcoming a key hurdle ahead of a crunch vote in parliament next week.