An anti-immigrant, anti-Muslim party won the Austrian elections on Sunday, and its leader might form a government with a party founded by ex-Nazis.
Kurz is well short of a majority and will probably need a coalition partner to govern.
The People's Party is led by 31-year-old former Foreign Minister Sebastian Kurz, nicknamed "Wunderwuzzi"-rough translation "wonder hotshot"-who campaigned heavily on a platform opposed to the mass Muslim migration quotas being forced by the European Commission". Having pledged to move away from often deadlocked coalitions with the center-left like the one now in power, an alliance with the FPO is likely. It made the neutral country fertile ground for parties out to halt the influx.
Chancellor Christian Kern's Social Democratic Party (SPO) managed to secure second place after a neck-and-neck race with the far-right Freedom Party, or FPO. He has, however, kept his coalition options open.
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The Social Democrats had been in control of the ruling government coalition, which fell apart this past spring after just one year. Last month, Alternative for Germany became the first far-right party to enter Germany's Parliament since World War II, winning 13 percent of the vote and 94 parliamentary seats.
Merkel said she congratulated Kurz on Sunday.
The offical results of Austria's elections are expected to be announced on Thursday after mail-in votes are counted.
Analysts predict this could lead to Austria promoting more reforms to the European Union and more autonomy for the member states.