The far-right party Alternative for Germany (AfD) is poised for a major breakthrough in Saxony-Anhalt-Anhalt's state election on Sunday. With around two million people, the former East German state could see AfD secure an overall majority and form its first state government. This would mark a seismic shift as AfD moves from opposition to wielding regional power.

AfD's rise has already destabilized national governance, forcing a grand coalition between Christian Democrats and Social Democrats after its second-place finish in last year's federal election with 20% of the vote. Now the most popular party in Germany, AfD is more extreme than peers like Giorgia Meloni's Brothers of Italy or Marine Le Pen's National Rally, having deepened ties to neo-Nazis and pledged to repatriate migrants. Germany's domestic intelligence agency classified AfD as 'right-wing extremist' last year, but its scale makes banning it impractical.

Chancellor Friedrich Merz's government, preoccupied with remilitarization and foreign policy, appears unable to counter the surge. The AfD's growth is rooted in Germany's economic decline: manufacturing, once Europe's strongest, faces American tariffs and Chinese competition ('China Shock 2.0'). Originally founded in 2013 as a fiscal hawk party opposing Greek bailouts, AfD shifted to anti-immigration after 2015's refugee crisis but retained economic conservatives focused on the debt brake.

Merz's decision to exempt military spending from the debt brake alienated right-wing voters, accelerating AfD's overtake of Christian Democrats in polls.