The German model
January 28, 2011
German Chancellor Angela Merkel called on other countries to follow Germany's example of fiscal discipline to fight debt in remarks at the World Economic Forum in Davos, Switzerland on Friday.
"Indebtedness is the biggest danger for prosperity on this continent. That is why we have to work resolutely against it," she said.
Merkel said austerity measures like the ones Germany has taken ultimately help growth.
"I was criticized and told Germany should contribute to growth, and if you consolidate, you'll endanger growth," she told an audience of political and business leaders. "But we had a very interesting experience in the last two years. We cut spending and had growth of 3.6 percent last year."
Merkel said she is concerned about signs of protectionism from other governments after the global economic crisis.
'If the euro fails, so does Europe'
Merkel repeated her promise to safeguard the euro currency, using a phrase that is becoming a slogan of hers: "If the euro fails, so does Europe."
"We will defend this euro and champion it, and we must keep it stable," she said, echoing a similar, impassioned speech by French President Nicolas Sarkozy earlier at the summit.
The European leaders' pledges came against a background of scepticism, especially among Germans, about the strength of the euro. A poll published on Friday by German public broadcaster ZDF found that 82 percent of Germans think the euro's stability is at risk.
Several leading economists at the World Economic Forum, however, argued that the euro has been a success since its introduction in 2002.
At Davos, Merkel also addressed the unprecedented protests in Egypt. Merkel called on the Egyptian government to allow peaceful demonstrations as authorities cracked down on thousands of protesters.
The World Economic Forum meets every year at a resort in Davos. This year's discussions have focused on the global financial crisis.
Author: Shant Shahrigian (AFP, dpa, Reuters)
Editor: Mark Hallam