German Chancellor Angela Merkel's conservative Christian Democrats (CDU) suffered heavy losses in an election in the state of Hesse yesterday, dealing her a blow ahead of next year's federal vote.
Led by Mrs Merkel ally and incumbent Premier Roland Koch, who ran a controversial campaign focused on crime and immigration, the CDU took 35.7 per cent of the vote, behind the rival Social Democrats' (SPD) 37.5 per cent, exit polls showed.
In a separate election in Lower Saxony, CDU Premier Christian Wulff won 42 per cent, sufficient to hold on to power with the liberal Free Democrats (FDP).
But both he and Mr Koch saw their support fall substantially from the last elections in their states in 2003.
Although the Lower Saxony result had been widely expected, the vote in Hesse, home to Germany's financial capital Frankfurt, was seen as a crucial test for Mrs Merkel's party as it seeks momentum ahead of the next federal election in 2009.
The result is likely to ratchet up tensions in Mrs Merkel's already fraught "grand coalition" - a left-right grouping between the CDU and SPD - potentially leading to a policy standstill until the next federal vote.
Nationally, the parties are at odds on issues ranging from tax and minimum wage to energy, security and foreign policy.
The outcome also represents a setback for Mrs Merkel, who gave strong personal backing to Mr Koch's campaign to clamp down on young criminals of foreign origin, firing up both parties in a divisive election which reverberated nationwide.
"In Hesse the conservatives have suffered such losses that it is clear that Mr Koch's election campaign hasn't worked," said Richard Stoess, a political scientist at Berlin's Free University.
Exit polls showed a finely balanced picture in Hesse, with the FDP, preferred partners of the CDU, on nine per cent and the Greens, with whom the SPD wants to share power, on eight per cent.
Because the big and small parties are so close, it is still unclear whether Mr Koch will retain power or cede it to SPD leftist Andrea Ypsilanti, who could become the only woman state premier in Germany.
Both state elections showed a clear shift to the left after years of dominating performances by Mrs Merkel's conservatives.
In Lower Saxony, the exit poll showed the new Left party, a far-left grouping of ex-communists and disaffected former SPD voters, passing the five per cent threshold to enter the Parliament of a large western state for the first time.
The outcome in Hesse, though still uncertain, could give a much-needed electoral boost to the SPD, which before yesterday's elections led governments in only five of Germany's 16 states.