CONSERVATIVE challenger Angela Merkel claimed a mandate to form Germany’s next government - but an exuberant chancellor Gerhard Schroeder refused to concede defeat after his party did better than expected in yesterday’s election and insisted that he should lead the next administration.

Germany’s acrimonious election campaign heads into the final stretch with Chancellor Gerhard Schroeder and conservative challenger Angela Merkel trading barbs to the last minute – reflecting the tight race that will decide the path Germany takes in trying to end years of economic stagnation.

A GRINNING Gerhard Schroeder leapt onto a giant stage to thumping music and applause from several thousand Social Democratic (SPD) supporters.