Dieter Kempf, president of Germany's BDI | John MacDougall/AFP via Getty Images Far right success endangers German economy, industry chief says Nationalism hurts efforts to attract skilled workers, Dieter Kempf warns.

The success of the far-right Alternative for Germany (AfD) presents a danger to Europe's largest economy, the head of the country's leading industrial lobby group said in an interview published Thursday.

"Success for the AfD damages the image of our country," Dieter Kempf, leader of the Federation of German Industries (BDI), told the Funke group of newspapers.

The far-right party has seen a surge in popularity in recent years, particularly since Europe's 2015 migration crisis, and is forecast to perform strongly in upcoming regional elections in eastern Germany.

"Economic locations must be attractive and inviting, in order to gain skilled workers from all over the world. Xenophobia and nationalism don't fit with an internationally successful German economy," Kempf said.

"Emphasizing nationalism would do enormous economic political damage to Germany, which is internationally connected like nowhere else," he said.

Polls show the AfD vying for first place in the states of Brandenburg and Saxony, which elect new regional parliaments on September 1. However, leaders of Germany's mainstream parties have ruled out forming a coalition with the AfD so it appears unlikely the party will be in government in either state after the elections.