By Thorsten Severin
STUTTGART, Germany (Reuters) - Chancellor Angela Merkel's ally Guido Westerwelle defended his Free Democrats' record in government on Thursday and said they kept the left out of power, but he did not address calls for his own resignation.
Germany's foreign minister and vice chancellor told a party conference in Stuttgart the country "needs a strong FDP," at a moment when the party often simply called the "Liberals" has sunk to just 4 percent in opinion polls.
"We Liberals will fight and I will fight because Germany has fared better than with a left-wing majority," said Westerwelle.
The 49-year-old led the FDP to a record performance in the national elections 15 months ago when it took 14.6 percent and became junior partner in Merkel's centre-right coalition.
But it has languished for months below the 5 percent threshold for entering Germany's parliament.
Merkel risks being destabilised by the unpopularity of the FDP, whose commitment to tax cuts -- and inability to deliver them in the financial crisis -- has alienated voters.
While Merkel's Christian Democrats and their Bavarian sister party are steady at 34 percent in polls, the FDP's decline has put the ruling coalition 17 points behind the opposition.
Westerwelle is a powerful orator who speech was closely monitored for signs he might succumb to pressure to step down. His own approval rating has sunk to 29 percent and one rebel has called him as a "millstone round the neck" of the FDP.
Littering his speech with phrases like "proud to be German," Westerwelle emphasised Germany's strong recovery from the global downturn and the FDP's role, saying: "We Liberals have contributed to our country being in such good shape and health."
"NOTHING NEW"
He earned a standing ovation, but Manfred Guellner, head of pollsters Forsa, said: "Even if it were a good speech, it's not going to reach voters who have turned their backs on the party. They've lost 80 percent of their voters since September 2009."
Peter Dausend, a columnist for Die Zeit newspaper, told German television there was "nothing new" in the speech.
"No one's any wiser now about what the FDP's going to do than they were before his speech. If I were an FDP voter, I'd be angry," said Dausend. "This speech just wasn't good enough."
The centre-right faces a major political test this year with seven state elections and the risk of losing Baden-Wuerttemberg, which the conservatives have held for nearly 60 years.
Merkel can ill afford instability in the coalition and was reported to have urged Westerwelle before the FDP's traditional "Three Kings' Day" meeting to "hang on" in the face of a revolt.
Westerwelle has vowed not to "abandon ship" but appears to have left open the question of whether he will seek re-election as party chairman at the FDP's annual conference in May.
As foreign minister Westerwelle got off to a poor start by refusing to answer a question in English at his first major news conference. He was later criticised for taking his gay partner, a German businessman, on official trips abroad.
Late last year he was embarrassed by Wikileaks' publication of U.S. diplomatic cables describing Westerwelle as arrogant and vain. One of his aides was revealed as the source of leaks to the U.S. embassy about secret German coalition negotiations.
(Additional reporting by Erik Kirschbaum; writing by Stephen Brown; Editing by Elizabeth Fullerton)
