Germany's Chancellor Angela Merkel. Photo: Sebastien Pirlet

Berlin - A lack of strong leadership and distinctive policies is hobbling the German opposition Social Democrats' (SPD) hopes of ousting Chancellor Angela Merkel in next year's election and is allowing her to claim credit for steering Europe through its debt crisis.

Damaging infighting is also hurting the centre-left party which many analysts believe will end up playing second fiddle to Merkel after the September 2013 vote as the junior member of her coalition government.

The weakness of the SPD, which governed Germany with the Greens between 1998 and 2005, all but guarantees Merkel's continued dominance of Europe's biggest economy.

A likely SPD win next month in a regional election in Germany's most populous state of North Rhine-Westphalia (NRW) may briefly boost morale but the challenges ahead look daunting for a party trailing Merkel's conservatives by about 10 points.

“Things look very difficult for the SPD. There's not much hope,” said Manfred Guellner, head of the Forsa polling institute.

“It faces a problem in finding a candidate to run against Merkel and has lost its anchor of local support ... Meanwhile, Merkel is having an easy ride,” he said.

Conservative Merkel has been able to count on the support of the staunchly pro-European SPD for votes on euro zone bailouts in parliament. She will need that support again in the summer when a two-thirds majority of lawmakers is required to pass an EU deal on fiscal discipline.

The backing of the SPD and the opposition Greens on the issue has helped Merkel survive a rebellion in her own ranks and assume the aura of a steward of the European economy in turbulent times and boosted her popularity among voters.

An opinion poll this week gave Merkel's centre-right Christian Democrats (CDU) 35 percent and the SPD 25 percent. The SPD's preferred coalition partner the Greens were on 13 percent and Merkel's current ally the Free Democrats on just 3 percent.

With the collapse in support for the pro-business Free Democrats, Merkel may have to look to the SPD as a partner next year. But the prospect of returning to power only under Merkel and the compromises that would entail could alienate the SPD party base in the 2013 election campaign.

The SPD shared power in a Merkel-led government between 2005 and 2009 and paid the price with a heavy election defeat.

A poll victory for Merkel's Christian Democrats (CDU) in the tiny state of Saarland last month does not bode well for the SPD, although the party tried to put a brave face on the outcome.

“A lost election doesn't mean you don't have victory in your DNA,” General Secretary Andrea Nahles said after the defeat. “It's good to have a win behind you. But it doesn't guarantee it will work the next time.”

Another problem for the movement is a surge in support for the maverick Pirate Party, which campaigns for online freedom and has won seats in two state parliaments in the last few months. All the mainstream parties are struggling to stop it stealing their votes. Probably the biggest headache for the SPD is picking a suitable candidate to run against Merkel for the chancellorship, a decision the party is widely expected to take in the autumn.

There are three contenders but none stand out, say critics.

Straight-talking former finance minister Peer Steinbrueck picked up some momentum last year when he started campaigning but has since failed to make much impact and many politicians and analysts have already ruled him out.

Another option is party chairman Sigmar Gabriel, who favours a more confrontational approach. He could mobilise the party's grass roots but his low personal popularity ratings mean few commentators rate his chances against Merkel.

That leaves Frank-Walter Steinmeier, a widely respected former foreign minister who is the most popular of the three.

But his track record may count against him. He ran against Merkel in 2009 only to deliver the party's worst performance since World War Two, winning 23 percent of the vote.

“If the SPD wants to fight Merkel for the centre ground, they have to go for Steinbrueck or Steinmeier,” said Gero Neugebauer, a political scientist at Berlin's Free University.

“In many ways, Steinmeier would be good but he hasn't got over his defeat to Merkel and that memory doesn't look good.”

With the crucial candidate question hanging over the party, bickering has broken out within the “troika” of leaders over their approach to the euro zone debt crisis.

Keen to avoid a euro zone collapse, the SPD has been forced to go along with Merkel's euro policies, including unpopular bailouts.

Critics accuse the party of failing to present a distinct policy on Europe and some party members want a more assertive approach, especially with the NRW election looming.

“The SPD support Europe and have toed Merkel's line. They've failed to offer a convincing alternative,” said Neugebauer.

The SPD has tried to sound more distinctive on euro zone policy in the last few weeks, calling for more steps to boost growth and create jobs to offset the austerity measures.

But the SPD does not want to be responsible for a German rejection of the EU budget discipline agreement and once again Merkel looks set to clinch a euro zone victory.

To compound the party's woes, German media reported last week that Steinmeier had been furious with Gabriel for going behind his back and sending a message to several party members telling them to question the SPD's backing for the fiscal pact.

It is not only European policy where Merkel has taken the ground from under the feet of the SPD.

“The chancellor has long been nibbling at the SPD's policy store cupboard,” wrote media and political consultant Richard Schuetze in a column on TheEuropean website.

He said the SPD had lost its monopoly on a range of policies from a minimum wage to a financial transaction tax, the exit from nuclear energy and abolition of military service.

By positioning herself in the middle of the German political spectrum, she has made her lead in the polls look unassailable, say pollsters.

After seven years in office, Merkel is still Germany's most popular politician, with 62 percent of Germans happy with her performance, more than 8 points ahead of anyone in the SPD.

Against a backdrop of an economy that is outperforming its neighbours and benefiting from record low unemployment - due in part to unpopular labour market reforms introduced by then SPD Chancellor Gerhard Schroeder - the SPD has its work cut out. - Reuters