German conservative leader Friedrich Merz reached a tentative agreement with the Green party on a debt-funded spending package for defense and infrastructure, people familiar with the discussions said.

German Chancellor-in-waiting Friedrich Merz was set to make a last-ditch attempt on Friday to convince the Greens of his plans for a massive increase in state borrowing to bolster defence and infrastructure ahead of a parliamentary vote next week.

BERLIN (Reuters) -Germany's Greens vowed to block plans by likely next chancellor Friedrich Merz for a massive increase in state borrowing but left room for compromise on Monday on measures to revamp the military and revive growth in Europe's biggest economy.