Then the conservative party paid tribute to Ms Merkel, 64, with a video showing highlights from her 18-year CDU leadership.
Economy Minister Peter Altmaier, a Merkel ally, said: "I am convinced that with Annegret Kramp-Karrenbauer, we have the best chance of the CDU winning an election", adding she would be the most risky candidate to face the centre-left Social Democrats and the ecologist Greens.
Kramp-Karrenbauer stepped down as the leader of Saarland several months ago, when Merkel personally requested that she become the CDU's general secretary, considered the second most powerful position in the party.
Chancellor Angela Merkel's party is meeting to elect a new leader who could help shape Germany's political direction for the next generation.
Pointing to the rise of populism worldwide and what she called a breakdown of shared Western values, Merkel said the order she had championed was at risk.
Merkel announced in October she would give up the reins in her party, though she plans to serve her current term as chancellor.
The Social Democrats (SPD), junior partner in Merkel's ruling coalition, congratulated Kramp-Karrenbauer and offered to work constructively with her. Her opponents for the role were Health Minister Jens Spahn, the country's most high-profile gay politician, and the conservative corporate lawyer Frederich Merz.
Merkel has led Germany since 2005, and moved her party steadily toward the political center.
Playing up her experience in regional government, she added to cheers and loud applause: "I learned what it is to lead - and above all learnt that leadership is more about being strong on the inside than being loud on the outside". She also celebrated Germany's balancing its budget in recent years and its response to the eurozone debt crisis.
Polling at around 30% - down from the 41.5% with which they won the 2013 vote - the party have lost votes to both the far-right Alternative for Germany and the liberal Green Party. The choice of leader also has more immediate implications for the future survival of Germany's biggest party, which has been struggling with an identity crisis, as well as Merkel's chances of serving out the rest of her term until 2021.
"We are facing a turning point and need a breakthrough for the next years".
"We have to have the courage to buck the zeitgeist", Kramp-Karrenbauer said in her speech to delegates.
One of the most recent examples of Merz wanting a change of course for the CDU has been his outspoken criticism of the United Nations migration pact, which was revealed to have been largely drafted by the Merkel government starting in 2016. A tearful Kramp-Karrenbauer thanked her rivals and invited them to share the stage with her in a show of party unity, which delegates applauded.
"Angela Merkel is one of the most widely admired and broadly influential statespeople of our time", Harvard President Larry Bacow told The Harvard Gazette.
After a smattering of applause throughout the course of her final speech as CDU chief, Merkel was bid farewell with a rousing standing ovation that lasted about 10 minutes and included a brief encore.
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