Berlin (AFP) - Former European Parliament chief Martin Schulz Sunday urged a "fairer" Germany as he launched his challenge to Chancellor Angela Merkel in September's general election, hoping to shake up the race on a wave of popularity.

"We will make this election really exciting," vowed Schulz after Social Democratic Party (SPD) leaders unanimously nominated him to run for the leadership of Europe's top economy.

The 61-year-old's return to German politics has boosted the SPD in the polls, turning up the heat on Merkel in an election where she is already under pressure from the rightwing populist Alternative for Germany (AfD) party.

His surprise entry into the race came after the party's little-loved vice-chancellor Sigmar Gabriel announced earlier this week he was standing aside to make way for Schulz, who will also replace him as SPD chief.

A former bookseller who never finished high school, Schulz vowed in his speech to champion the interests of "hardworking people" and strive to bridge the "deep divisions" in the country.

"Let us make our country fairer," he said to loud applause at the party's Berlin headquarters.

- 'More difficult' for Merkel -

Even before Schulz's challenge, Merkel had predicted that the coming election, in which she is seeking a fourth term, would be "more difficult than any before it".

Merkel's conservatives suffered a string of embarrassing defeats in regional polls last year, as the anti-immigrant AfD gained ground by railing against her liberal refugee policy that has seen over a million migrants arrive in the country since 2015.

But her approval ratings have bounced back as the influx has slowed and as voters look to a safe pair of hands following Britain's vote to leave the European Union and the inauguration of Donald Trump as US president.

The latest poll by public broadcaster ZDF showed support for the SPD climbing from 20 to 24 percent, with Merkel's conservative CDU/CSU block unchanged at 36 percent.

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If voters had the option to elect their chancellor directly, 44 percent would choose Merkel, closely followed by Schulz at 40 percent, the poll found.

Schulz indicated he wasn't running just so the SPD could stay on as junior partner in another Merkel-run coalition government.

"The SPD is in this race to become the largest political power in the country," Schulz said. "And I am running to become chancellor."

Schulz's candidacy for the chancellorship is set to be confirmed in a party congress on March 19, considered a formality.

- 'Disgrace' -

Observers say Schulz owes his popularity in part to the fact that he is known as a heavyweight politician, while not being too closely associated with the SPD's lacklustre years governing in Merkel's shadow.

In a speech closely scrutinised for his domestic views after two decades spent in Brussels, Schulz took aim at the AfD, saying Germany knew what "blind nationalism" could lead to.

The AfD "is not an alternative for Germany, but a disgrace to the country," he said.

At a time of growing resentment against the political "elite", Schulz also took the opportunity to remind voters of his own modest background, despite being a veteran of EU politics.

An autodidact who speaks six languages, Schulz wanted to be a footballer, a dream he had to give up because of a knee injury.

He became mayor of the western German city of Wuerselen at 31, the youngest official to hold such a role in the state of North Rhine-Westphalia, and was elected to the European Parliament in 1994.

He stepped down as its president two months ago, saying he wanted to re-enter German politics but without specifying his ambitions.

While Merkel's conservatives continue to have a comfortable lead over the SPD in the polls, Schulz's arrival adds an element of unpredictability to the race.

The far-left Die Linke party has already urged Schulz to state whether he would be open to forming a three-party coalition also involving the Green party, hoping to force Merkel's conservatives into opposition.

Schulz made no mention of any coalition prospects in his speech, but said he would ask all parties in the race to agree to a "fairness pact" to avoid the kind of ugly race that caused such divisions in the US.

"We can't let that happen in Germany," he said.