Tuesday, October 27, 1998 Published at 15:20 GMT
New era beckons as Schröder takes office
Gerhard Schröder: Main task is to fight unemployment
Gerhard Schröder was sworn in as chancellor by President Roman Herzog on Tuesday afternoon, after the confirmation of his appointment in the morning sitting of parliament.
The new cabinet was due to meet before the end of the day.
The coalition agreement has seen the appointment of Germany's first-ever Green Party cabinet ministers. Party leader Joschka Fischer secured the position of foreign minister, which also means he will deputise as chancellor when Mr Schröder is absent.
Social Democrat Wolfgang Thierse has been selected as speaker of parliament. He started out as an opposition activist in the former East Germany.
Mr Thierse is the first East German to hold this important office, which in terms of protocol is second only to the presidency, although the chancellorship is more powerful.
The "red-green" coalition is to raise tax on fuel and begin phasing out nuclear power - proposals which have already earned criticism from business leaders.
But overall, the government intends to reduce the tax burden on Germans by $6bn.
Germany's central bankers have rejected calls for cuts in interest rates from the left-leaning Mr Lafontaine. They fear the government could continue to apply more political pressure in the run-up to the launch of the euro in January.
The new government also plans to amend the nationality laws, which currently do not guarantee citizenship to German-born children of immigrant parents.
The new government has said another new priority is to bring the eastern and western parts of Germany closer together - a task which will be helped by the move scheduled for next year of the German capital from Bonn to Berlin.
Mr Kohl took a back bench seat in parliament on Monday, but was also awarded Germany's highest honour - Grand Cross (Special Design) of the Order of Merit - for his 16 years as chancellor.