The German political landscape has been shaken by Sunday’s election, even though Angela Merkel will serve a fourth term as leader. Her conservative Christian Democratic Union had its worst result since 1949, the opposition Social Democrats have been similarly wounded and will opt out of the coalition and, most troubling, there will be a significant far-right presence in parliament for the first time in half a century . Difficulties lie ahead for the chancellor, the most immediate being forming a government. But for all the surprises, the nation remains politically calm and Merkel is still Europe’s most powerful politician, comforting constants to help China, the European Union and world deal with their challenges. Opinion: Why a weakened Angela Merkel is still the most important politician in the West Merkel’s open-door refugee policy is largely blamed for her party’s drop in support of about 10 per cent. Concern about the consequences, especially in the less-developed east, led to backing for the extremist Alternative for Germany, which took 13 per cent of the vote and will be the third-biggest party in parliament with 95 seats. But while its anti-Europe views that migrants should be barred and Muslims pose a threat have won votes, fears about its rise are overblown. The other five parties have vowed to isolate it and the 87 per cent of Germans who opted for mainstream thinking prove its limits. Society can now properly debate and debunk its views. Germany’s reasonable economic growth has ensured Merkel’s return. But there are challenges from the protectionist ways of US President Donald Trump and Britain’s vote to leave the EU. Trade negotiations with China could also be problematic; both sides fret about the fairness of investment deals and Germans worry that their technological edge is being threatened. But all need a stable Germany that is led by a chancellor who has a steady hand. Merkel’s favour with China to remain intact, analysts say Merkel offers that. She has to strike a deal with the Greens and pro-business liberals to form a government. Resolving the refugee question will require a deft strategy. Then there is the squabbling within the EU over Britain and continued pressure from member nations in the south to secede. Fortunately, Germans have chosen the best person to take on such challenges.