Angela Merkel's CDU, CSU allies discuss Germany's refugee cap

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Thirteen days after an election in which support for her Christian Democratic Union-led bloc dropped to its lowest level since 1949, Merkel faced criticism of her policies and style by delegates at a CDU youth convention who said she's straying from the party's conservative roots and demanded that she rejuvenate her Cabinet.

Under the face-saving compromise brokered on Sunday, sources told Reuters Germany would accept around 200,000 people a year on humanitarian grounds, including families of refugees already in Germany.

Syrian refugee Anas Modaman takes a selfie with German Chancellor Angela Merkel outside a refugee camp near the Federal Office for Migration and Refugees after registration at Berlin's Spandau district, Germany September 10, 2015. With Germany serving as the EU's economic engine, a prolonged political battle could have economic implications that ripple beyond the country's borders. The FDP and Greens have also said they would not consider an upper-limit on refugees."I will do everything I can to move this forward ..." In his speech, Christian Democratic Union also addressed debate on loss of votes, Merkel said, "The responsible policies require not only being shocked after a selection, but also to see strategic possibilities".

Before the election, Mrs Merkel governed in a grand coalition with the Social Democrats (SPD), but with her reduced majority and the SPD's refusal to govern with her again, she must look elsewhere to form another government.

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The emergence of the anti-immigration AfD, which scored 12.6 percent, has stunned Germany by breaking a long-standing taboo on hard-right parties sitting in the Bundestag.

Her best shot now - if she wants to avoid fresh elections that could further boost the AfD - is an alliance with two other parties that make for odd bedfellows, the pro-business Free Democrats (FDP) and the left-leaning Greens. Much of their success came at the expense of mainstream conservatives.

Such an alliance - which would be unprecedented in Germany at the national level - has been dubbed the "Jamaica coalition" because the colours of the three parties match the black, yellow and green of the Caribbean country's flag.

Talks are continuing on other policies, including pensions and Europe, but the migrant issue was the biggest problem.

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The smaller parties will seek to avoid the fate of Merkel's previous junior coalition partners: both the FDP and SPD have suffered stunning losses after governing in the veteran chancellor's shadow.

European Union and euro politics are shaping up as another divisive issue.

Despite facing political pressure after opening Germany's borders in 2015, Merkel has always pushed back against any sort of limit to refugee arrivals.

"We must form a government quickly".

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The Greens' co-leader Cem Ozdemir, voicing some impatience with the divided conservatives, warned that they "must not block the formation of a government for weeks".

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