Mr Kurz has made a dramatic intervention ahead of this month’s crucial elections in Germany and warned a left-wing alliance could create a “massive problem” for the European Union. Ms Merkel will step down as German Chancellor after 16 years in the role and voters will head to the polls on September 26.
The left-wing Social Democrat party is currently leading many opinion polls and may open the door for a socialist coalition with the Greens.
Mr Kurz has voiced major concerns over the financial impact of the move on the bloc as Germany is the largest economy in the EU.
He said: “Austria is economically closely interlinked with Germany, Germany is the economic locomotive in the European Union.
“If there is a left-wing government in Germany, then that is a massive problem not only in Germany and for Germany, but then it is a massive problem for Europe as a business location.”
The Austrian chief has backed the heir-apparent to Ms Merkel for victory in the election.
Armin Laschet, the leader of the Christian Democratic Union (CDU), is the nomination for the CDU and its Bavarian sister party, the Christian Social Union (CSU).
Mr Kurz described the candidate as a “staunch European” and insisted he is the “right person to lead Germany”.
He said: “So far, he has been very successful in steering and leading the largest German state.
“He is a staunch European, someone we have always enjoyed working with.
“I am convinced that he is the right person to lead Germany for the next few years.”
The latest Kantar poll gave the Social Democrats a four-point lead.
The part led by Finance Minister Olaf Scholz was on 25 percent of the vote – with the Union alliance on 21 points.
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“Or a federal government led by the CDU and CSU with Armin Laschet as chancellor – a federal government that leads our country into the future with moderation.”
Ms Merkel added Mr Lashet would lead a government that stands for “stability, reliability, moderation and the middle ground – and that is exactly what Germany needs”.
Mr Scholz has repeatedly distanced himself from the Linke party.
Speaking on ARD television, he added: “Now is the hour of the citizens.
“They will decide, and the stronger the SPD vote, the better the chances for a good government.”
Additional reporting by Monika Pallenberg.