Germany's opposition conservative Christian Democratic Party (CDU) declared it had the won the election in the northern state of Schleswig Holstein on Sunday after exit polls by German public broadcasters ARD and ZDF showed the party taking a solid 40.2 percent of the vote.

The victory will provide a boost for the CDU ahead of another crucial state poll in the state of North Rhine-Westphalia on May 22 and should ease pressure on embattled CDU leader Angela Merkel. "Red-Green has been voted out. They don't have a majority of their own," Merkel said. "This is a good omen for the election in North Rhine-Westphalia."

As against that, Chancellor Gerhard Schröder's ruling Social Democratic Party (SPD) lost substantial ground, winning just 38.5 percent compared with 43.1 percent in the last election in 2000. The SPD had ruled the state for 17 years. "We did not achieve our primary goal in Schleswig-Holstein of a Red-Green majority," SPD national party leader Franz Müntefering said after the vote.

The result, though yet to be officially confirmed until all the votes are counted, is a severe setback for the chancellor whose party has only recently started to recover in the polls after losing a series of state elections last year.

Setback for SPD

Schröder himself enjoys wide popularity amongst Germans. He has enjoyed a remarkable comeback since the summer, standing firm in the face of mass protests against his tough welfare reforms and profiting from bitter divisions in the conservative opposition ranks. However, his Social Democratic Party (SPD) is slumping nationwide.

Traditional Social Democratic strongholds such as Hamburg or Saarland are now firmly in the hands of the opposition conservative Christian Democrats (CDU). Most recently, the SPD plummeted to 9.8 percent of the vote in Saxon state elections in eastern Germany, just a fraction ahead of the right-wing National Democratic Party.

In the run-up to the vote in Schleswig-Holstein, the SPD and their Green coalition partners came under increasing pressure amid concern over soaring unemployment and a scandal over a visa policy that let thousands of illegal immigrants into Germany

Sunday's result is expected to further demoralize the ailing SPD, which is in sore need of a boost of confidence in the run-up to the 2006 general elections.

Heide Simonis, the popular and quick-witted SPD premier of Schleswig Holstein and a loyal Schröder ally, was widely expected to edge out the CDU candidate Peter Harry Carstensen. Personal opinion polls prior to the election consistently placed her ahead of Carstensen. However, she has been criticized for hardly mentioning unemployment on the campaign trail, despite the fact that Schleswig-Holstein suffers the worst jobless rate in western Germany.

On Sunday, Simonis said she was disappointed by the result, but insisted that the SPD had led a good and committed political campaign and had tackled the right issues.

Far-right party not in

The extreme-right National Democratic Party (NPD) meanwhile will fail to gain a seat in the state parliament after only scoring around two percent of the votes, the exit polls showed.

Last September, the NPD won seats in a regional parliament for the first time since 1968 when it surged to 9.2 percent in the eastern state of Saxony. The party caused controversy in the Saxony parliament last month when its representatives refused to take part in a minute's silence for the victims of Auschwitz.