German conservatives to replace Merkel with Annegret Kramp-Karrenbauer as party head

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Chancellor Angela Merkel said farewell to 18 years as leader of the Christian Democratic Union with a speech and a standing ovation at the party's convention in Hamburg today.

Merkel, however, recalled that the CDU was in a deep crisis when she took over in 2000, mired in a party financing scandal surrounding ex-Chancellor Helmut Kohl.

"I am grateful for the time that is behind me, and I am glad for being able to continue working as chancellor", she said.

"Whether it's the rejection of multilateralism, the return to nationalism, the reduction of global cooperation to deal-making or threatened trade wars. hybrid warfare, destabilisation of societies with fake news or the future of our European Union - we Christian Democrats must show in the face of all these challenges what we've got", she said.

Merkel listed some of those moments and many more in a half-hour farewell speech as leader, telling delegates that "our CDU today is different from the year 2000, and that is a good thing".

Merkel announced in October she would give up the reins in her party, though she plans to serve her current term as chancellor. The third candidate, 38-year-old Jens Spahn, is seen as a rank outsider in the contest, the CDU's first competitive vote for a new leader since 1971.

Merkel has expressed her determination to stay on as chancellor for the remaining three years of her term in office. He won support this week from party veteran and former finance minister Wolfgang Schaeuble.

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Kramp-Karrenbauer's trump card was her record as a former state premier in Saarland, where she led a broad coalition with the Greens and pro-business Free Democrats, alliance-building skills useful in Germany's fractured political landscape.

The 56-year-old has differentiated herself from Merkel on social and foreign policy by voting in favour of quotas for women on corporate boards, which was opposed by Merkel, and by taking a tougher line on Russian Federation.

She told Reuters last week that Europe and the United States should consider blockading Russian ships over the Ukraine crisis.

By contrast, Merz takes clear positions that appeal to rank-and-file party members hungry for a more clearly defined conservative party.

Merz will benefit from the fact that 296 of the delegates at the congress - nearly a third - will be from his home state, the western state of North Rhine-Westphalia.

A senior CDU official, speaking on condition of anonymity, said many delegates were undecided before the congress and could be swayed by how the candidates present themselves on Friday.

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