* Merkel’s candidate elected only in third round
* Rebels on government benches defy chancellor
* Vote casts more doubts on her leadership (Adds final election result)
By Stephen Brown and Erik Kirschbaum
BERLIN, June 30 (Reuters) - Rebels inside German Chancellor Angela Merkel’s coalition made her endure three rounds of voting before securing the presidency for her candidate on Wednesday, in a dramatic display of disenchantment with her leadership.
Merkel’s conservative candidate Christian Wulff beat Joachim Gauck, a non-partisan civil rights campaigner fielded by the centre left, only after a marathon session of a special assembly to choose the largely ceremonial head of state.
For only the third time in post-war history a German presidential election went to a third round, in what analysts called a slap in the face for chancellor, who has struggled to assert her authority on the nine-month-old coalition.
“At the end of the day we had a very convincing result,” said Merkel, while her ally Guido Westerwelle of the liberal Free Democrats said other presidents had been elected after three rounds “and became great figures in the republic”.
But Merkel was deprived of the decisive victory she needed to counter setbacks including high-profile resignations on the centre-right — such as Horst Koehler’s surprise departure as president in May — and criticism at home and abroad of her leadership in the financial crisis and recent austerity drive.
With her approval ratings already at record lows before the vote, Merkel is now likely to face serious questions about her ability to lead Europe’s economic powerhouse, just as the world looks to Germany to help it emerge from recession.
“It is indeed a big defeat, a significant number of people clearly left the government’s camp and voted for Gauck,” said political scientist Peter Loesche. “Today was supposed to be a big positive sign for the coalition, now the opposite is true.”
Merkel’s supposedly “safe” candidate, Lower Saxony premier Wulff, failed to get an absolute majority in the first two rounds despite having, on paper at least, 644 of 1,244 seats in the assembly of parliamentarians and state representatives.
The coalition had been braced for some rebel votes — but not on this scale. Wulff was nearly two dozen votes short of the 623 needed for an absolutely majority in the first round and not much better in the second. By third ballot, which is decided by simple majority, he finally mustered 625 votes.
The unexpectedly tough contest was partly due to the broad appeal of Gauck, a 70-year-old Protestant Pastor who stood up to the communist regime in former East Germany and from 1990 to 2000 ran a commission investigating the Stasi secret police.
“I’m delighted I was elected in the third and last round,” said Wulff, who was once seen as a potential successor to Merkel but ruled himself out of that job in 2008 by saying he was not enough of an “alpha male”.
Such was the drama surrounding the vote that hundreds of people gathered outside the Reichstag parliament building to follow events blow-by-blow on giant television screens.
Merkel and her liberal ally Guido Westerwelle endured weeks of negative publicity, prompting speculation that the secret ballot could show the centre right giving vent to its disenchantment.
But the scale of the revolt was a shock, said Gerd Langguth, political scientist at Bonn University: “That was a big slap in the face. I didn’t expect that many to vote against her.”
“Merkel’s worst flop,” was the verdict of influential weekly Der Spiegel, which continued on its website: “Merkel should fear the twilight of her chancellorship.”
Merkel, who became Germany’s first woman chancellor in 2005 and is its first leader raised in the formerly communist East, already lost her majority in the upper house of parliament this year after an election defeat in North Rhine-Westphalia state.
She faces five more state elections in 2011 — if she survives that long as leader, undermined by the presidential vote and the reaction to her 80 billion euro austerity drive, criticised abroad as likely to hinder world recovery.
“I think for the time being the coalition will survive but with a big question mark hanging over it,” said political scientist Everhard Holtmann. “It’s possible the coalition won’t make it all the way to the end of the term in 2013.”
For analyst reactions, click on [ID:nLDE65T2F9]
Additional reporting by Erik Kirschbaum and Paul Carrel; Writing by Stephen Brown; Editing by Paul Taylor, Jon Hemming and David Stamp