For the first time since World War II, a far-right party has come second in a German national election.
Alternative for Deutschland (AfD) received its highest-ever share of the electorate with about 20 per cent of the vote in the latest count.
Centre-right opposition leader Friedrich Merz is on track to be Germany's next chancellor, with his Christian Democratic Union (CDU) party alongside Christian Social Union (CSU) projected to win the election.
After securing about 30 per cent of the vote, the Christian Democratic Union of Germany will need to forge a coalition with other parties to form government but AfD is unlikely to be considered.
That's because of a long historical agreement between political parties in Germany, which is sometimes referred to as a firewall, to not make political deals with the far right.
Who is Germany's next chancellor?
Mr Merz grew up in the Sauerland, a Catholic upland region in far western Germany known for its social conservatism and close-knit village communities.
He embodied many of the virtues of West Germany before the fall of the Berlin Wall — transatlanticist, business-oriented and socially conservative.
However, reunification in 1990 allowed Angela Merkel, the East German daughter of a protestant pastor, to enter politics and elbow Mr Merz aside on her rise to become chancellor.
Professor Peter Morgan, director of the University of Sydney's European Studies Program, said: "Angela Merkel, who was his nemesis, [and Merz] were very competitive for the leadership of the party."
But Ms Merkel's ascent into German politics saw her quickly dominate both the political landscape in her party and country and more broadly in Europe.
That's according to Monash University's Associate Professor Ben Wellings who specialises in politics and international relations.
"In a way, he's been in Merkel's shadow for a long time," Associate Professor Wellings said.
"But she took a hit in popularity and respect after her response to the 2015 Syrian refugee crisis within her party, even though that was kind of lauded in various parts of Germany and the world."
That's when Mr Merz was able to slowly capitalise on Ms Merkel's waning popularity, Associate Professor Wellings said.
But it did not happen all at once, it was only after Ms Merkel left political life that Mr Merz was able to pursue what some have called his 'third act' in politics.
"But he had to wait until Merkel had lost government to Olaf Scholz, and that opened the way for him to assume the leadership of the party," he said.
What are the politics of the new government?
Associate Professor Wellings likened the "permanent coalition" between the Christian Democratic Union and the Christian Social Union to Australia's Liberals and Nationals when it comes to government.
"[They] are going to be much more kind of pro-business and anti-regulation," he said.
Professor Morgan broadly agreed but added under Ms Merkel the CDU/CSU were economically conservative with a strong pro-European agenda.
But under Mr Merz, there might be some differences in how the CDU/CSU operates.
"Presumably also will be pro-EU, but perhaps with much stricter attitudes towards the finances of the EU and certainly the finances of Germany," he said.
The party was likely to be more economically conservative than the previous government and look to rebuild German industry and the economy but might be much less green, Professor Morgan said.
"It has also been traditionally a party that's socially conservative … But I can't see it turning back the clock on lots of social issues," he said.
The outgoing government led by Olaf Scholz couldn't respond to the cost of living crisis, which was made worse by the ongoing war in Ukraine, Associate Professor Wellings said.
That was what ultimately brought Mr Scholz's government down.
"So the differences are going to be on approaches to re-energising the German economy, it's a huge economy in Europe. It's the biggest economy in the European Union," he said.
To put that into context, Germany is Australia's 11th largest trade partner, with two-way trade totalling about $28.9 billion in 2022-23.
While, Germany is Australia's sixth largest source of imports that includes mostly transport services, cars and medical goods.
"The change of approach is going to be noticeable around security, about how the CDU, which is a bit more pro-Ukraine … how that then shapes up to create a European response," Associate Professor Wellings said.
Germany's historic firewall against the far right
Associate Professor Wellings explained the concept of the 'firewall' in Germany as an agreement to not ally with the far right, which has been a growing force in the country since reunification in the 1990s.
"This is historically inflected because when the Nazis came to power in 1933 it was through a miscalculation by the German conservatives that they could control the Nazis," he said.
"They underestimated Hitler, and then Hitler was able to use the conservatives, and that's how he seizes power, without the Nazi party ever winning an actual majority in an election."
The firewall was tested in January when Mr Merz received support from the AfD for a migration bill.
It was the first time a mainstream political party in Germany had worked with a far-right party since the Second World War.
"That's why Merz's alignment with the AfD over this vote on immigration was so significant, and it's why it brought people out in the streets in January in protest against it," he said.
"So the firewall, it's a convention in German politics that you don't do any electoral deals or enter into coalition with the far right for historical reasons."
Before election day, Mr Merz made efforts to distance himself from the AfD calling the far-right party his most important opponent and vowing that his party would never work with them.
"This party stands against everything our party and our country built up in Germany over the past years and decades. It stands against our Western orientation, it stands against the euro, it stands against NATO," he said.
"It is the most important opponent for us in this election campaign — we want to make it small again … There are no ifs, there are no buts."
ABC/Wires
