Merkel bloc wins election but faces far-right challenge

A man holds a banner reading Solidarity instead of Racism as police blocks demonstrators protesting against the nationalist'Alternative for Germany, AfD party in Berlin Germany Sunday Sept. 24 2017 after the polling stations for the German parliam

"This is a hard and bitter day for German social democracy", a grim-faced Schulz, a former European Parliament chief, told reporters, adding that he hoped to remain party leader.

Founded in 2013 by an anti-euro group of academics, the AfD has surged as an anti-immigrant group in the wake of Merkel's 2015 decision to leave German borders open to over 1 million migrants, a lot of them fleeing war in the Middle East. "We must respond to the AfD voters and those people who clearly feel misunderstood", she said.

Germany in particular is coping with the arrival of more than 1 million refugees and other new migrants, with tension with Russian Federation since Moscow's incursions into Ukraine, and with doubt about Europe's future since Britain voted to quit the EU.

The anti-immigration Alternative for Germany (AfD) stunned the establishment by winning 13.1 per cent of the vote, projected results showed, a result that will bring a far-right party into parliament for the first time in more than half a century.

"For us, the grand coalition ends today", Manuela Schwesig told ZDF broadcaster. While it's a combination previously untested at national level, such a government was formed this year in the state of Schleswig-Holstein, and the chancellor has kept tabs on the region's progress ever since.

The business-friendly FDP, which some analysts say drew voters away from Merkel, the Greens and The Left Party - the latter is the successor to the East German communists - also have cleared the 5 percent vote threshold to enter parliament. "But we mustn't forget that we have just completed an extraordinarily challenging legislative period, so I am happy that we reached the strategic goals of our election campaign", Merkel said.

The Social Democrats made clear that they don't want to be part of it. Merkel on Friday night told supporters in Munich not to be complacent with her bloc's lead. Once a government is in place, Merkel will face huge global expectations - from shoring up the euro area together with France, to setting Europe's tone in its dealings with the US under President Donald Trump, and tackling the diesel-emissions crisis that threatens Germany's dominance in producing luxury cars. His party is now on course to enter a coalition government.

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Speaking in Prague on Thursday, the tennis star said "I can't imagine Spain without Catalonia and Catalonia without Spain". However, regionĊŸ officials don't intend to change plans and say the plebiscite will go ahead as planned if it is possible.

All the same, speculation that the FDP's relatively hardline stance toward Europe could threaten efforts to work with French President Emmanuel Macron on euro-area integration "is often overdone", according to Holger Schmieding and Florian Hense at Berenberg in London, who said the party's views would likely moderate over time.

As she starts her fourth term, there is no challenger in sight, but plenty of challenges ahead for Merkel, whom New Yorker magazine just labelled "the most powerful woman in a world filled with unstable men".

"We have suffered a crushing election defeat", Schulz said. Schulz, 61, a former president of the European Parliament, appeared a formidable contender when the SPD pulled virtually even with Merkel's bloc soon after he entered the race in January.

If the Social Democrats stick to that pledge, Merkel will effectively have only one option to form a new government: teaming up with the Free Democrats and the Greens in an alliance that has never yet been tried in a national German government.

"Of course we had hoped for a slightly better result".

- The Greens and the Left hold station, scoring very similarly to four years ago. The xenophobic party ran on an anti-immigrant platform with an emphasis on closing Germany's borders to migrants.

While the current inclination is for Merkel and other mainstream MPs to isolate their right-wing counterparts, they won't be able to ignore them completely.

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