The timing could hardly be worse for Merkel’s Christian Democrats, who have ruled NRW in an alliance with the pro-business Free Democrats (FDP) since 2005, and a defeat could also cost her her majority in the upper house of parliament.
Most Germans oppose the 22.4b euros (28.6b dollars) of German money in loans over three years to debt-wracked Greece as Germany grapples with its own dire fiscal straits.
The annoucnement of the creation of a 110b euro EU-IMF fund for Greece was followed a day later by the creation of a 70b euro unit to sheiled the euro itself against further market speculation.
NRW is ruled by the same centre-right coalition Merkel has in Berlin, making the poll a potentially damaging referendum on her government eight months after she won re-election.
The state is also home to the Ruhr rust belt region whose economic misery has deepened in the recession.
A poll published Saturday showed that 21 percent of NRW voters said the Greek bailout would affect their ballot decision, according to the YouGov survey for the daily Bild.
“The issue has electrified people as seldom before and is going to play a determining role” in the election, said Klaus-Peter Schoeppner, head of the polling institute Emnid, in the online edition of the Rheinische Post.
Merkel on offensive over bailout
Underlining the poll’s importance, Merkel scheduled 15 personal appearances in NRW and staged a media blitz this week to defend the aid to Greece.
But the chancellor has also faced criticism in Germany and abroad of dragging her feet over aid to Greece and thereby exacerbating the crisis.
After months of falling popularity, the five-year-old centre-right coalition in the state could win 43 to 45 percent of the vote, according to polls.
The rival Social Democrats (SPD), who held power in the state for four decades until 2005, and their preferred partners, the Greens, are scoring between 45 and 47 percent.
The SPD abstained in Friday’s vote on the Greek loan package, a tactical move that analysts said could pay off in NRW.
Beyond control of the NRW state legislature, the dominance of Merkel’s coalition in the Bundesrat upper house also hangs in the balance.
Currently, the conservatives and the FDP hold 37 of the 69 seats in the Bundesrat, just over the 35 votes needed for an absolute majority. Losing NRW would deprive the centre-right of six seats.
That would effectively axe a drive by the FDP to cut income taxes by 16 billion euros from 2012 – a move many conservatives, and many voters, oppose as fiscally irresponsible in light of Germany’s parlous public finances.
It would also give the centre-left the power to block health care reforms planned by the coalition, and to restore an initiative to mothball the country’s nuclear reactors against the wishes of the Merkel government.
The vote’s impact would be long-lasting as well as it is the only state election planned this year.
Political scientist Gerd Langguth of the University of Bonn said it was difficult to exaggerate importance of the election for the German political landscape.
“For months, federal politics has been nearly at a standstill because all decisions have been taken with a view to this election, or postponed until after it takes place,” he said.
“North Rhine-Westphalia has always been, historically speaking, a seismograph for national politics.”