Former German Finance Minister Peer Steinbrueck to stand against Angela Merkel

The main opposition party has embarked on an uphill struggle to oust Angela Merkel, the Chancellor, choosing a respected former Finance Minister who helped steer Germany through the financial crisis as her challenger in next year's election.

Peer Steinbrueck, 65, emerged as the centre-left Social Democrats' candidate ahead of two other potential challengers.

The party leader, Sigmar Gabriel, declared that Mr Steinbrueck was "the right candidate" for a campaign in which the party plans to make a major issue of "taming financial markets".

Earlier this week Mr Steinbrueck called for big European banks to build up a €200bn rescue fund rather than relying on taxpayer-funded aid.

AP