Chancellor Angela Merkel will on Friday begin a final stretch of negotiations with Germanys second biggest party to form a government, four months after an inconclusive election left the country in political limbo.

The formal negotiations bring Germany a step closer to a new government and come after the SPD on Sunday narrowly approved a preliminary cooperation blueprint and agreed to push on with the talks.

But the outcome is still uncertain as the SPD will give its 440,000 members a vote on the end result.

September's election left Merkel without a majority and struggling to find partners to govern, as the far-right AfD party capitalised on anger over a record influx of asylum seekers to snatch voters from the established parties.

After Merkel's bid to form a government with the smaller left-leaning Greens and pro-business FDP fell through, she was forced to woo back the SPD, its partner in the last four-year-term.