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Merkel praises Italian economic reforms
Merkel and Monti. Photo: DPA

Merkel praises Italian economic reforms

Published: 11 Jan 2012 14:48 GMT+01:00
Updated: 11 Jan 2012 14:48 GMT+01:00

Chancellor Angela Merkel on Wednesday said she had "great respect" for the economic reforms implemented by Italy, as the crisis-wracked country battles to bring down its debt.

"As for the speed and substance of these measures, I think they will strengthen Italy, will improve its economic prospects and we have watched with great respect how quickly they have been implemented," Merkel said after meeting Italian Prime Minister Mario Monti.

"I think that overall, the work of the Italian government will be rewarded and I have said from the beginning that we should work very, very closely together," the chancellor added.

Earlier on Wednesday, Monti had warned in a newspaper interview of possible "anti-European" protests in his country if Rome's reform efforts were not recognised.

Speaking in German daily Die Welt, Monti complained: "The problem is that despite our sacrifices, we have not got anything in return from the European Union, such as a drop in interest rates.

"Unfortunately, we have to say that our reform policies have not received the recognition and appreciation in Europe that they deserve," the prime minister added.

"If the Italian people do not soon see tangible success for their savings and reform efforts, there will be a protest against Europe, against Germany - seen as the driver of EU intolerance - and against the ECB (European Central Bank)."

Strengthening Merkel's hand in her effort to promote fiscal responsibility, data showed Wednesday that the German economy, Europe's biggest, remained the powerhouse and one of the few bright spots in the eurozone.

German gross domestic product (GDP) expanded 3.0 percent in 2011, compared a record 3.7 percent the previous year, even though the eurozone crisis began to crimp growth in the fourth quarter, official data showed.

The strong performance enabled Germany to bring down its public deficit to just 1.0 percent of GDP last year from 4.3 percent a year earlier.

Elsewhere in the 17-nation eurozone, however, prospects were less rosy.

The European Union revised downwards its figure for eurozone growth over the third quarter of last year, to 0.1 percent.

The previous figure given was 0.2 percent but detailed EU data showed a drop on France's previously published growth rate between July and September, from 0.4 percent to 0.3 percent, which caused the revision.

Data also showed Wednesday that eurozone banks stashed a record sum with the ECB, suggesting tensions in the financial system remain despite huge injections of cash.

Banks parked €485.9 billion at the ECB on deposit for 24 hours, beating the record set the previous day.

AFP/hc

The Local (news@thelocal.de)

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Your comments about this article

15:52 January 11, 2012 by mos101392
"If the Italian people do not soon see tangible success for their savings and reform efforts, there will be a protest against Europe, against Germany - seen as the driver of EU intolerance - and against the ECB (European Central Bank)."

Blah Blah Blah.....It took years of living the life off the backs of others, do the Italians think or expect change overnight. Common sense tells you if it took 10 yrs to be where you are at....it might take another 10 yrs to heal. One cannot expect to live the good life without sacrifice. Good thing I'm not German, otherwise I might protest against giving even more handouts. Same with the Greeks! I think there is a difference in cultures...some can't expect to do the work while others sit outside cafes and drink capacinos and laugh it up with friends...otherwise, they live in a dream world and sooner or later reality catches up...no wonder the Brits don't want anything to do with the euro!
17:31 January 11, 2012 by Englishted
@mos101392

I don't know where you are from but would you find it alright if a bigger and more powerful body say like the E.U. decided to impose a leader on you ?,

because the new leaders of Italy and Greece were not elected .

They were imposed to force through cuts and more cuts most of which effect people who had nothing to do with bringing about the crisis in the first place.

The E.U. was never a very democratic body but things are turning worse and I don't know where it will end but I fear the trend.
19:14 January 11, 2012 by mos101392
@ Englishted

Sounds like a sad story. I'm from Calif but live in Germany. There are some that say, your problems aren't my problems. Maybe the "elected" politicians did a bad job at "cooking" the books when it came to being a part of the euro zone...and now the time has come and only now are they squirming. Maybe, since the "elected" politicians got their people in this mess, and if they want out of this mess...then the ones who have the economic means to help, know who is better to do the job!. I don't think the argument is with Germany and France, the Greek and Italian peoples should be venting their anger at "THEIR" politicians who got them into this mess from the start.

No one was complaining the last 10 yrs but now is reality and if you are reaching out for help, then you must expect some conditions.

In America, it was easy for everyone to buy a home,,,it didn't matter if you had the money,,,now it has come full circle and those same families expect to keep their homes even though they can't pay anymore. I only wish I could get free money and not have to pay it back!
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