Open

Coming up

Don't miss

Replay


LATEST SHOWS

MEDIAWATCH

Royal decree on low-cut tops

Read more

DEBATE

Ukraine, The Escalation: No Stopping Putin? (part 2)

Read more

DEBATE

Ukraine, The Escalation: No Stopping Putin?

Read more

FOCUS

Bangladesh: Textile workers' lives still at risk?

Read more

TALKING EUROPE

José Bové, Candidate for the EU Commission presidency, Group of the Greens

Read more

WEB NEWS

NYPD's online campaign backfires

Read more

ENCORE!

Celebrating the Bard's birthday in Britain

Read more

THE INTERVIEW

Yuki Tatsumi, Senior Associate of the East Asia Program, Stimson Center

Read more

INSIDE THE AMERICAS

USA: Executions halted over drugs secrecy

Read more

  • Russia orders military drills as Ukraine moves on separatists

    Read more

  • Israel halts Middle East peace talks over Hamas deal

    Read more

  • A radio station preaches peace and tolerance in CAR

    Read more

  • Platini: PSG in danger over Financial Fair Play rules

    Read more

  • Ségolène Royal denies banning cleavage at French ministry

    Read more

  • Afghan guard kills US doctors in Kabul hospital attack

    Read more

  • Palestinian unity deal stirs anger in Israel

    Read more

  • Video: Mayor in east Ukraine ready ‘to turn Slaviansk into battlefield’

    Read more

  • US would defend Japan in islands dispute, Obama says

    Read more

  • New far-right mayor moves to quash Paris region mosque

    Read more

  • US soldiers arrive in Poland as Ukraine crisis continues

    Read more

  • Fatah, Hamas agree to form Palestinian unity government

    Read more

  • Millions of Syrians desperately need aid, says UN

    Read more

  • Muslims in CAR pray for an escape route

    Read more

  • Madrid beat Bayern 1-0 in first leg of Champions League semis

    Read more

  • Britain's ex-PM Blair warns against spread of radical Islam

    Read more

  • Turkish PM offers condolences to descendants of Armenians killed in 1915

    Read more

  • Gay marriage, one year on: ‘French civilisation did not crumble’

    Read more

  • Colombian president reinstates firebrand Bogota mayor

    Read more

  • NYPD public relations campaign on Twitter goes awry

    Read more

  • In pictures: Violent protests erupt in Rio

    Read more

Europe

Merkel warns of "difficult" 2013 for Germany and eurozone

©

Text by News Wires

Latest update : 2012-12-31

Chancellor Angela Merkel warned that for Germany “the economic environment next year will not be easier, but more difficult" in her annual New Year address. Merkel also stated that the eurozone “crisis is a long way from being overcome”.

Chancellor Angela Merkel warned Germans that the economy, Europe's biggest, would experience a harder time next year than in 2012 and cautioned too that the eurozone debt crisis was far from over.

In her annual New Year address published Monday, Merkel said: "In fact, the economic environment next year will not be easier, but more difficult", adding: "The crisis is a long way from being beaten."

Although top exporter Germany has managed to hold up to the crisis fairly well, growth has slowed here as well since the beginning of the year.

After expanding by 0.5 percent in the first quarter of 2012, gross domestic product (GDP) grew by just 0.3 percent in the second quarter and a mere 0.2 percent in the third quarter.

And in October, the government slashed its forecast for economic output next year to 1.0 percent, compared to 1.6 percent previously anticipated.

The country's gloomy central bank has said Germany may even flirt briefly with recession early next year.

The Bundesbank also forecast that Germany would only grow by a meagre 0.4 percent next year.

Nevertheless, "it has been possible this year to have the lowest unemployment and the highest level of employment since the reunification" in 1990, Merkel recalled.

And a slowdown next year "should not leave us discouraged but should spur us on", said the chancellor, according to the text of her speech released in advance by her office.

Turning to the eurozone's efforts to tackle its three-year debt crisis, she judged that "the reforms that we have decided are beginning to work".

"However, we still need more patience. The crisis is a long way from being overcome."

She appeared more pessimistic than other eurozone leaders such as France's President Francois Hollande or even her own finance minister, Wolfgang Schaeuble, both of whom have declared the worst of the crisis over.

In an interview with mass circulation Bild last week, Schaeuble said: "I think the worst is behind us", citing positive developments in Greece and France.

Hollande has repeatedly said the eurozone crisis, which has at times threatened the very existence of the 17-country currency union, was past.

Merkel also called for better supervision of the financial markets, stressing: "The world has still not sufficiently learnt the lessons of the devastating financial crisis of 2008".

"Never again should such a lack of responsibility assert itself as before. In the social market economy, the state is the guardian of order and people have to be able to have confidence in that," added the chancellor.

(AFP)

Date created : 2012-12-31

  • EUROZONE

    EU strikes deal on single banking supervisor

    Read more

  • EUROZONE

    EU leaders agree to greater banking oversight

    Read more

  • EUROZONE

    France, Germany clash threatens EU summit

    Read more

Comments

COMMENT(S)