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With a mixture of hope and anxiety, East Germans will today elect their first freely chosen government in nearly 60 years.

At stake is nothing less than the pace and form of German unification, an event that will transform the balance of power in Europe.``It is the start of a new destiny,' commented a ranking Western diplomat here. ``It is the final public demise of the old system.'

The election also marks the dawn of unfettered democracy for the more than 100 million citizens of the Soviet Union's former satellite empire of Eastern Europe.

Hungary will hold its first free national election in 40 years next Sunday, while polls in Czechoslovakia, Bulgaria and Romania are scheduled to follow later in the year.

None of those, however, carry with them the significance of the vote in East Germany.

``The (East German) voters are not only deciding about their own destiny, but also about the soundness of the European home, in which we all want to live in equality and without fear of one another,' West German President Richard von Weizsaecker said in an interview published in today's edition of the mass circulation paper, Bild am Sonntag.

The 400-member parliament that East Germans elect will form a government with the curious mandate of dissolving itself into a unified greater Germany.

In the process, however, it must negotiate a myriad of key unification-linked issues, including a currency union with West Germany.

It must restore confidence in a population that still leaves the country at a rate of 2,000 per day, prepare a climate favorable for immediate industrial renewal and preside over the corruption trials of Communist leaders, including former party boss Erich Honecker.

Today's vote follows a campaign dominated by a single issue: how the two Germanys should unify.

The overwhelming role of West German political parties and personalities in the debate indicated that, at one level, unification was already a fact.

On election eve, a moderately right-wing three-party coalition backed by Chancellor Helmut Kohl's West German Christian Democrats contends as a front-runner with a recently revived Social Democratic Party, supported with equal zeal by its West German counterpart.

Few analysts expect either group to win a clear majority, and the prospect of a broad coalition is considered a likely result.

An opinion poll published last week by the West German group INFAS indicated a slight lead for the Social Democrats. But with nearly half those questioned still undecided and polling accuracy in East Germany untested, the race was considered wide open.

The rightist coalition, aided by Kohl's personal appearances, has drawn huge, enthusiastic crowds during the final days of the campaign. These crowds responded warmly to the coalition's call for free enterprise and swift unification based mainly on accepting existing West German law.

However, it was badly stung Wednesday when one of its leading candidates, Wolfgang Schnur, was forced to resign after admitting he had worked for the neo-Stalinist secret police during the Communist era.

The move toward unification, coupled with the heavy involvement of the main West German parties in the present campaign, makes the eventual outcome here a potential influence on crucial West German elections later this year.

In all, East Germany's 12.2 million voters will choose from a list of 24 parties ranging from the once all-powerful Communists to a beer-drinkers' union running on a platform to lift the total ban on drinking before driving.

The opposition group New Forum, which led the country's revolution in the streets last fall and seemed at the time to be a potentially major political force, has run an ill-organized, underfinanced campaign with no help from the West and is likely to win only 1 percent or 2 percent of the vote.

By contrast, the discredited Communists that New Forum helped topple have managed a revival of sorts.

By changing their name to Democratic Socialists and running a light, quip-a-minute campaign built around their clever, fast-talking party leader, Gregor Gysi, some observers believe the Communists could obtain as much as 15 percent of the vote.

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