He has secured a more business-friendly finance minister, in the shape of Hans Eichel.

ECONOMIST: Schr?der??s struggle

Mr Eichel hinted that the stability pact should apply to levels of spending, not to budget deficits.

ECONOMIST: Europe's single-currency rules

Hans Eichel, a former premier of the state of Hesse, became Germany's finance minister after Oskar Lafontaine resigned.

ECONOMIST: Heads roll