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Merkel warns of tougher times ahead
Photo: DPA

Merkel warns of tougher times ahead

Published: 31 Dec 2012 09:15 GMT+01:00
Updated: 31 Dec 2012 09:15 GMT+01:00

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

In her annual New Year address published on 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 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.

In October, the government slashed its forecast for economic output next year to 1.0 percent, compared to 1.6 percent previously seen.

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 in 2013.

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

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

AFP/The Local/mw

The Local (news@thelocal.de)

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Your comments about this article

10:44 December 31, 2012 by The-ex-pat
Yes Angie, tough times ahead when you are on €16000 a month.........
11:49 December 31, 2012 by blackboot11
Preaching Austerity and tough times ahead then giving themselves a pay raise:

"Merkel, her ministers and their parliamentary secretaries of state will see their wages rise in three stages between now and August 2013, until they all get 5.7 percent more.

The chancellor's total pay is set to rise from €16,152 per month before tax to around €17,016. This does not include her €1,022 ¦quot;special duties¦quot; allowance.

Ministers' pay will rise by €750 euros to around €13,795 a month. This will amount to a bump of around €9,000 over a year. "
11:52 December 31, 2012 by Berlin fuer alles
Well deserved pay raise considering how well she has done for her Bankster buddies. After all it only takes a little bit extra austerity to pay for these pay raises and with so much austerity going around these days it is easy slip in a bit extra.
13:26 December 31, 2012 by Englishted
"Merkel also called for better supervision" does she mean her minster who is singing from a different song sheet?

"The situation is better than expected because of stronger trade with the US and Asia, among other things. The German economy will therefore grow at a decent rate in 2013," Schäuble said.

But remember brainwashed supporters austerity begins at home ,

your home.
19:04 December 31, 2012 by marimay
As he/she sits there in his/her ugly suit made of pure silver. How dare he/she!
22:49 December 31, 2012 by www.emungus.net
THE TIME OF MIRTH HAS SHORT TIME

To many Germs this topic must have a chilling effect. A few days ago, the tone was cheerful for finance minister Wolfgang Schäuble(optimistic) and chancellor Angela Merkel (canny). Mr. Schäuble has been quoted by The Local as saying that ''the worst is behind us''. Certainly German citizens were felt relieved as a period of stable economy was in sight. Now none of that. Does time of mirth has a so short lifetime?
04:22 January 1, 2013 by DOZ
1010011010
21:22 January 4, 2013 by blacksunne88
Merkel is a traitor to Gemany and everyone who has examined her record knows it.She prospered in the Soviet Zone of Occupation based on her talents as a traitor. Today she works for the international bankers and their New World Order. Her only interest in the German people is her concern that the guilt complex pounded into peoples' heads since WW2 be updated with new lies, preferably every week. What has she done for Germany? She should be arrested and expelled to one of the countries she loves--Poland, the Czech Republic, Israel, or the USA. If you think that is too harsh then retain her in the German diplomatic service, but please, let's try to reduce the harm she can do by sending her to Outer Mongolia, the Congo, or some othe paradise.
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