Some 1.3 million voters are heading to the polls on Sunday to cast their ballots in what many in Germany see as a referendum on Chancellor Angela Merkel's refugee policy. Merkel's constituency is in Mecklenburg-Western Pommerania, but she is not up for election as it is a state parliamentary poll, not a federal one. Results are expected late Sunday.

Merkel, delivering a closing campaign speech Saturday in northeastern Germany where she had held an electorate since 1990, stuck by her welcoming policy toward refugees - despite survey slumps for her conservatives and her as leader.

"The vast majority of people are ready to help people in distress in the world. For that I am very thankful. We must maintain this [stance], she said.

Addressing a Christian Democrat (CDU) rally in Bad Doberan, Merkel also warned asylum applicants: "Those who have no prospect to stay must leave our country."

In a newspaper interview Saturday, she again defended her chancellery's decision a year ago this weekend not to close Germany's border to refugees arriving via Austria from Hungary while upholding the EU's ethos of keeping open its internal borders.

"We did not reduce benefits for anyone in Germany as a result of the aid for refugees," she told Saturday's edition of the newspaper "Bild."

SPD out front, AfD could come second

Mecklenburg-Western Pommerania's incumbent premier, Erwin Sellering, 67, and his Social Democrats (SPD) look likely to emerge from Sunday's poll among 1.3 million registered voters with about 28 percent in the 71-seat assembly in Schwerin.

Surveys also show the right-wing, populist Alternative for Germany (AfD) - launched in 2013 nationwide on an anti-EU ticket but more recently soliciting anti-migrant and anti-Islam sentiment, likely to score between 21 and 23 percent.

If so, that would place the AfD slightly ahead of Merkel's regional CDU which is polling at between 20 and 22 percent and led by regional interior minister Lorenz Caffier.

For 10 years, Sellering's SPD and Caffier's CDU have governed Germany's increasingly popular Baltic Sea tourist state with a shipyards tradition as so-called "grand coalition" partners in Schwerin, the regional capital that until 1990 was part of communist East Germany.

Three-way coalition?

Speculation on ahead of the vote centered on whether the SPD and CDU would still secure enough seats to form a further coalition, but with a third partner, possibly the Greens co-led by Silke Gajek and Jürgen Suhr, who are on about six percent.

That scenario would see the AfD led by Leif-Erik Holm propelled for the first time into the Schwerin assembly, alongside the communist-origin Left party, led by Helmut Holter, which up to election eve was polling between 13 percent and 15 percent.

Germany's common 5 percent threshold would see the liberal Free Democrats (FDP), led by French-born Cécile Bonnet-Weidhofer, falling short, and the loss of five seats by the NPD, the only extreme right party currently with regional parliamentary seats in any of Germany's 16 states.

In Germany's 2013 federal election, which led Merkel to form its current governing coalition with the Social Democrats (SPD), the AfD missed the Bundestag threshold, gleaning 4.7 percent of the vote.

It has since gained regional opposition footholds in eight German states, and in 2014 won seven seats in the European Parliament. Recent surveys have shown it polling nationwide between 10 percent and 12 percent - on a par with the Greens, and ahead of the Left on 9 percent.

'Frightening prospect'

The prospect of the AfD gaining a Schwerin foothold was "frightening," said the president of the Central Council of Jews in Germany Josef Schuster on Friday.

"The voters aren't realizing they are voting for a party that doesn't want to distance itself from the far-right spectrum," Schuster said.

Berlin Free University political science professor Hajo Funke said long-standing sentiments existed in rural areas of Mecklenburg-Western Pommerania over shrinkages in facilities, jobs and declining populations. Its unemployment rate is 9 percent, well above Germany's average 6.1 percent.

Investors scared off?

Leading German economists also warned that further AfD gains would erode Germany's image as a place to invest and operate.

"In particular the economically weak eastern German regions will pay a high price for a lurch to the right and a surge in xenophobic populism," Marcel Fratzscher, president of the German DIW institute for economic research told the business daily "Handelsblatt."

These regions were dependent on investment by firms that were also increasingly dependent on trained foreign recruits, Fratzscher stressed.

Gustav Horn, director of the IMK Institute for Macroeconomic Research, said voter survey trends reflected a shunning of the global economy.

"Its advantages are no longer being recognized but instead are being seen as threats," he said.

Key voter sampling before 2017

Although far fewer migrants are now arriving in Germany, compared to 2015, Sunday's Mecklenburg-Western Pommerania election - and Berlin city-state's own election on 18 September - are key tests looking ahead to German national polls in 2017.

The next federal parliamentary elections are due in September, preceded in May by another key election in North Rhine-Westphalia, Germany's most populous state.

Chancellery candidates next year?

Merkel has yet to say whether she will seek a fourth term. Fallout on Sunday could further test her ties with her erstwhile ally, the Christian Social Union (CSU), the Bavarian sister party to her CDU.

At federal level, Vice Chancellor Sigmar Gabriel has featured prominently in northern hemisphere summer season interviews as the Social Democrat's likely candidate for chancellor next year.

But, TNS Emnid survey results published Saturday by the Essen-based Funke Media Group showed him scoring only 16 percent among 1006 persons questioned on who they trusted as chancellor to handle the challenges of next year.

Merkel's role as the right person to lead the country had fallen to 44 percent.

Social Democrat Foreign Minister Frank-Walter Steinmeier was favored by 38 percent of respondents on the person to handle multiple issues facing Germany.

Bavaria's conservative CSU leader and Bavarian Premier Horst Seehofer scored 28 percent.

ipj/kl (Reuters, dpa, AFP, AP)