Merkel says euro zone crisis far from over

Sun Dec 30, 2012 6:21pm EST
 
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BERLIN (Reuters) - The euro zone sovereign debt crisis is far from over even though reform measures designed to address the roots of the problem are beginning to bear fruit, German Chancellor Angela Merkel has said in her New Year's address.

In a taped interview to be broadcast on Monday evening, Merkel urged Germans to be more patient even though the euro zone crisis has already dragged on for three years. She drew a line linking German prosperity to a prosperous European Union.

"For our prosperity and our solidarity we need to strike the right balance," Merkel said. "The European sovereign debt crisis shows how important this balance is.

"The reforms that we've introduced are beginning to have an impact," she said. "Nevertheless we need to have further continued patience. The crisis is far from over."

Merkel indirectly contradicted Finance Minister Wolfgang Schaeuble with those comments. In an interview on Friday in Bild newspaper Schaeuble said the worst of the crisis was over.

Germany has been the paymaster in the euro zone crisis, to the chagrin of many German voters and a growing bloc of conservative lawmakers in Merkel's coalition. Germans remain wary of euro zone bailout efforts but give Merkel high marks for what they consider to be her judicious handling of the crisis.

Merkel, who is seeking a third term in an election in September, proudly pointed out that unemployment in Germany had fallen to its lowest level since reunification in 1990 while the number of people employed had also risen to record highs.

"That means that many hundreds of thousands of families have a secure future," said Merkel. "And that means that a lot of young people have the security of training and jobs and thus will get off to a good start in their careers."

But in face of slowing economic growth, Merkel also warned that conditions could be more difficult in 2013 than in 2012.   Continued...

 
German Chancellor Angela Merkel poses for photographs after the recording of her annual New Year's speech at the Chancellery in Berlin December 30, 2012. REUTERS/John Macdougall/Pool