Merkel alliance loses control of key state says exit poll

An exit poll indicates Chancellor Angela Merkel's centre-right alliance has lost control of Germany's most populous state.

That would strip her national government of its majority in parliament's upper house – a setback that could make it harder to run Europe's biggest economy.

Yesterday's state election in North Rhine-Westphalia – the first ballot since Ms Merkel's second term started in October – has loomed over efforts to tackle the Greek debt crisis.

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An ARD television exit poll showed Ms Merkel's Christian Democrats winning 34.5 per cent of the vote and their coalition partners, the Free Democrats, 6.5 per cent.

That would leave them short of a majority in the state legislature in Duesseldorf. The poll found the opposition Social Democrats would win 34.5 per cent, the Greens 12.5 per cent and the Left Party 6 per cent.

Opposition leaders initially accused Mrs Merkel of holding out on aid for Athens to avoid annoying supporters before the election. Rescuing Greece is unpopular in Germany.

On Friday, however, parliament approved a bill allowing Germany to grant as much as 22.4 billion euro (19.3bn) in credit over three years as part of a wider rescue plan.

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"A stable currency is the be-all and end-all of prosperity and security," Chancellor Merkel said on Saturday.

Meanwhile, US President Barack Obama has had another conversation with Ms Merkel about the economic situation in Europe.

White House spokesman Bill Burton says the two leaders discussed the importance of European Union countries taking "resolute steps" to build confidence in the markets.

Markets have been shaky the past few days owing to fears that fiscal problems in Greece would spread throughout Europe.

Mr Obama returned Ms Merkel's phone call after he arrived at Hampton University's commencement ceremony on Sunday.

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