German Chancellor Friedrich Merz has suffered a heavy political setback following two state elections on Sunday, including a record defeat for his party, but he has pledged to push ahead with difficult reforms to Europe’s largest economy.

Exit polls released by public broadcaster ARD showed Merz’s centre-right Christian Democratic Union, or CDU, securing just 5 per cent of the vote in Mecklenburg-Western Pomerania, the lowest score recorded by the party in any state since the Second World War.

Meanwhile, the anti-migration and Russia-friendly Alternative for Germany, or AfD, made noticeable gains.

Mr Merz described the result for his party as a “disaster”, yet remained resolute, refusing to step back from his government’s reform agenda.

He insisted that Germany’s political and economic troubles rendered tough and potentially unpopular measures more urgent, promising to press forward.

“What needs to be done now requires backbone, steadfastness, and patience,” Mr Merz said in a statement shortly after the exit polls were broadcast.

“I will demonstrate these qualities as chairman of the CDU and, above all, as chancellor of our country.”

In Berlin, ARD’s exit poll projected the CDU to finish second with 20 per cent, behind the Left party on 24.5 per cent.

Mr Merz’s standing had already been damaged by the CDU’s heavy defeat to the AfD in the 6 September election in the eastern state of Saxony-Anhalt.

That outcome shocked many Germans who believed the country had built resilience against nationalism and ideas of racial superiority through post-war education and anti-persecution legislation.

On Sunday, the AfD was projected to secure significant advances across both states, gathering 37 per cent in Mecklenburg-Western Pomerania and 15.7 per cent in Berlin, according to ARD, though it remains well short of forming a regional government.

The AfD’s national co-leader, Tino Chrupalla, told ZDF television that “the chancellor’s statement today really was more than feeble. He announced that he’d carry on as before, instead of finally drawing the consequences and resigning.”

However, in an apparent reference to the far-right movement, Mr Merz stated his government’s measures would serve as “the antidote to the poison of authoritarianism, which is penetrating ever deeper into our society as the fascination with authoritarianism grows”.

The 70-year-old leader took office 16 months ago with promises to reignite an economy stalled for years, but has struggled to rally the nation and seen his popularity plummet.

The AfD’s strong performance in Saxony-Anhalt, where it holds its highest chance yet of leading a regional government, has further undermined the chancellor’s authority nationwide.

Calls have emerged over the past fortnight, including from within his own party, for Mr Merz to step down, although senior allies have avoided making public demands for his departure while warning against “personnel debates”.

Anticipating a difficult period, Mr Merz cancelled a scheduled visit to New York next week for the UN General Assembly, though he reiterated his resolve to remain in post and complete his term as chancellor.