Opposition leader Angela Merkel (search) failed Friday to persuade the Green party to join talks on forming a coalition, closing another avenue for Germany to escape its post-election stalemate.

The center-right opposition edged Chancellor Gerhard Schroeder's (search) Social Democrats in the Sept. 18 parliamentary vote, but fell short of a majority for its program of accelerated economic reforms and closer ties with Washington.

Merkel, head of the Christian Democratic Union (search), held talks with Green party leaders to sound out whether they could ally with her and the pro-business Free Democrats (search) in a so-called "Jamaica" coalition.

But the Greens — members of Schroeder's outgoing government coalition — declined an invitation to hold more detailed discussions because of broad dissimilarities in policy.

"The differences are very big," Merkel said after the talks. "I would have liked to have spoken more in detail about where we overlap, but the Greens have a different wish."

Green party co-chairman Reinhard Buetikofer (search) said he had challenged Merkel and Edmund Stoiber (search), leader of the Bavaria-only Christian Social Union (search), to explain whether they would drop their "neo-liberal, radical market, anti-ecological policies."

"Mrs. Merkel and Mr. Stoiber didn't give us the answer, and on that basis we said we see no possibility to recommend further talks," Buetikofer said.

Many observers believe a so-called "grand coalition" of conservatives and Social Democrats is the most likely outcome of the wrangling.

Merkel and Schroeder held brief initial talks Thursday and agreed to meet again next week. Both said Germany needs a government stable enough to carry out further reforms to a welfare state system creaking under the burden of high unemployment and an aging population.

But they failed to resolve their competing claims to the chancellorship, sustaining speculation that both may eventually have to step down or that the country might have to vote again.

The deadlock means Germany could spend weeks without leadership at a time when it needs to fire up its ailing economy, the world's third-largest.

It also could hamper German diplomacy just as the European Union takes the lead in negotiations with Iran over its disputed nuclear program and prepares for membership talks with Turkey.

Schroeder argues that voters rejected Merkel as chancellor, awarding the CDU only 27.8 percent support, after months of polling as much as 40 percent.

However, including the CSU, the conservatives reached 35.2 percent, topping the Social Democrats' 34.3 percent.

Just as the Greens are resisting the advances of the conservatives, so the Free Democrats have snubbed overtures from Schroeder's party, narrowing room for maneuvering.

The Social Democrats also have ruled out cooperating with the Left Party, a new bloc of former East German communists and renegade Social Democrats who call for reversing Schroeder's welfare reforms.

Merkel and Schroeder have spoken out against any form of minority government.