German Chancellor Angela Merkel's conservative Christian Democrats (CDU) and their Bavarian sister party moved closer to a coalition deal on Monday.
Chancellor Angela Merkel said the CDU and CSU managed to sort out differences on migration policy after lengthy discussions on Sunday.
"We have reached a common agreement ... and now we can begin exploratory talks with the FDP and the Greens," Merkel told a joint news conference with CSU leader Horst Seehofer in Berlin.
The CSU had long called for setting an upper limit on refugees while Merkel advocated an open-door policy for asylum seekers fleeing civil wars.
An agreed position will see the CDU and CSU work to ensure the number of asylum seekers coming to Germany does not exceed 200,000 people a year.
The CSU also dropped its opposition to drafting an immigration law with the goal of attracting highly qualified third-country nationals.
Merkel said exploratory talks on forming a coalition government would begin on Oct. 18, with the CDU/CSU bloc holding separate discussions with the liberal Free Democrats (FDP) and the Greens.
She said they are planning to hold a joint meeting with top officials of the four parties on October 20.
Merkel has already ruled out any talks with the far-right Alternative for Germany party, effectively barring them from government.
Merkel's Cristian Democratic bloc is facing tough talks on forming a government following the Sept. 24 elections. The CDU/CSU won 33 percent of the vote, its worst result since the end of World War II.
After the Social Democrats decided to assume the role of main opposition following their embarrassing loss in the election, a CDU/CSU-led coalition government with the liberal FDP and the Greens appeared the most likely coalition option.
As the traditional colors of these parties -- black, yellow and green -- correspond to Jamaica's flag, this coalition is often referred to as the "Jamaica coalition".