Leading article: Ms Merkel auditions for the global stage

As the Group of Eight leaders get down to serious business today, the German Chancellor, Angela Merkel, will for once be unable to deflect the spotlight. One of the most self-effacing individuals in a line of business that tends to attract people of quite a different stamp, Ms Merkel is hosting the elite of the elite; this summit is not just Germany's show, but her show. And while the outcome will owe much to the advance work of sherpas and support staff, it is her chairmanship, her diplomacy and her leadership by which the summit will be judged. Its success will be her success, its failure her failure. Heiligendamm represents Ms Merkel's most exacting test so far.

Indirectly, she recognised the personal element, selecting as the venue a resort in the constituency she represents in the Bundestag, which itself is in the part of former East Germany that was her home. This, however, is about as much of a personal statement she chose to make. Through the many bilateral meetings and increasingly urgent sets of preparatory negotiations, Ms Merkel kept her head well below the parapet. The contrast between 2007 and other G8 summits of recent years could hardly be greater.

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The low profile taken so far by Germany's first woman Chancellor, however, is deceptive. Half-way through her second year in office, Ms Merkel is riding a wave of popularity at home. She is in complete charge of her party and her governing coalition. Despite predictions that she would never last six months as Chancellor, given the slimness of her electoral majority and the ambitious politicians around her, she has not only survived, but flourished.

She has carried through every project she has undertaken - including some denounced as impossible (tackling health service spending) or ill-advised (a rise in VAT). Her patience and single-mindedness are becoming legendary, as is her ability - shades of Margaret Thatcher here - to gain a thorough mastery of every controversial brief. Germany's economy, which for so long was Europe's laggard, is on the way to overtaking Britain's in terms of growth. Unemployment, long Germany's most intractable problem, has finally begun to fall.

It can be debated, of course, how much Ms Merkel's success in turning around Germany's economy is a delayed response to the unpopular labour market reforms introduced by her predecessor, Gerhard Schroeder - reforms which arguably cost him his job. But successful politicians need luck almost as much as they need courage, competence and judgement. And fortune has not always smiled on Ms Merkel.

It is hard now to remember the lacklustre campaign she waged in 2005, a campaign that almost cost her an election that had been hers to lose. It is hard, too, to recall the near-tied result that tempted Mr Schroeder to try to cling to office, or the fragility of her first couple of months. This is all in the past. Today, Germans are finding that their unflashy chancellor, whose few indulgences have been a sleeker haircut and some brighter jackets, suits them just as well, if not better, than the showman who occupied the Chancellery before her.

The question now is whether Ms Merkel can extend the personal authority she has won at home to the international stage. In Europe, she is gaining a reputation for quiet and competent diplomacy, and the flying visit she received from the new French President on the day of his inauguration held out the prospect of a new Franco-German dynamo for the EU. She has yet to prove herself in the self-important G8, where too much modesty could prove a handicap. If she can tease concessions on climate change from President Bush tomorrow, she should step up and claim the credit.