Merkel attacks ‘political’ limits on trade surpluses

German Chancellor Angela Merkel Thursday attacked "political" limits on national trade surpluses, hitting back at US proposals to tackle world economic imbalances.

Merkel attacks 'political' limits on trade surpluses
Photo: DPA

“To set political limits on trade surpluses and deficits is neither economically justified nor politically appropriate,” she said in a speech to a G20 business summit, hours before leaders of the grouping were to begin meeting.

The United States had earlier proposed limiting current account surpluses or shortfalls to four percent of a nation’s output.

It shelved the idea of numerical targets following fierce opposition from surplus countries such as China, Germany and Japan.

Leaders of the Group of 20 advanced and emerging economies will later Thursday start a two-day summit set to be dominated by disputes over foreign exchange rates and trade imbalances.

Merkel also called for leaders to take a strong stance against trade protectionism.

“We have to do everything to avoid protectionism. So we have to send a signal from the summit that we finally get into the last round of Doha negotiations (on freeing up world trade),” she said.

Merkel said France, which will take over as G20 president following the Seoul summit, “is facing some hard work.”

“So far we were in a phase of dealing with the crisis, now we are facing a phase of what will the G20 be like after the crisis.”

Nations must find “reasonable exit strategies” when rolling back stimulus programmes, she said.

“It’s absolutely necessary to stick to the Toronto (G20 June summit) goal of slashing deficits in half by 2013,” Merkel said.

“Fiscal credibility does not have to hinder growth but can actually enhance growth,” she said, adding that budget consolidation is compatible with growth.

But Merkel also vowed Thursday to work with US President Barack Obama on Afghanistan and the world economy, despite her earlier criticism of Washington’s economic policy.

Merkel said she would use a meeting with Obama before a G20 summit was to begin “to send a signal, really good signal,” for global growth.

“Only together will we be able to tackle the crucial problems of the world today, problems and issues such as Afghanistan, the upcoming NATO summit meeting and also obviously issues of the G20,” she said, hours before the summit was to get under way.

Obama said he and Merkel have much to discuss on issues such as Afghanistan.

“On economic issues as G20 members, but also as two of the world’s largest economies, making sure that we continue with a balanced and sustainable growth that all of us seek,” he added.


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Sleep, seaside, potato soup: What will Merkel do next?

 After 16 years in charge of Europe's biggest economy, the first thing Angela Merkel wants to do when she retires from politics is take "a little nap". But what about after that?

Outgoing German Chancellor Angela Merkel briefly closes her eyes and smiles at a 2018 press conference in Berlin.
Outgoing German Chancellor Angela Merkel briefly closes her eyes at a 2018 press conference in Berlin. Aside from plans to take "a little nap" after retiring this week, she hasn't given much away about what she might do next. Tobias SCHWARZ / AFP

The veteran chancellor has been tight-lipped about what she will do after handing over the reins to her successor Olaf Scholz on December 8th.

During her four terms in office, 67-year-old Merkel was often described as the most powerful woman in the world — but she hinted recently that she will not miss being in charge.

“I will understand very quickly that all this is now someone else’s responsibility. And I think I’m going to like that situation a lot,” she said during a trip to Washington this summer.

Famous for her stamina and her ability to remain fresh after all-night meetings, Merkel once said she can store sleep like a camel stores water.

But when asked about her retirement in Washington, she replied: “Maybe I’ll try to read something, then my eyes will start to close because I’m tired, so I’ll take a little nap, and then we’ll see where I show up.”

READ ALSO: ‘Eternal’ chancellor: Germany’s Merkel to hand over power
READ ALSO: The Merkel-Raute: How a hand gesture became a brand

‘See what happens’
First elected as an MP in 1990, just after German reunification, Merkel recently suggested she had never had time to stop and reflect on what else she might like to do.

“I have never had a normal working day and… I have naturally stopped asking myself what interests me most outside politics,” she told an audience during a joint interview with Nigerian writer Chimamanda Ngozi Adichie.

“As I have reached the age of 67, I don’t have an infinite amount of time left. This means that I want to think carefully about what I want to do in the next phase of my life,” she said.

“Do I want to write, do I want to speak, do I want to go hiking, do I want to stay at home, do I want to see the world? I’ve decided to just do nothing to begin with and see what happens.”

Merkel’s predecessors have not stayed quiet for long. Helmut Schmidt, who left the chancellery in 1982, became co-editor of the weekly newspaper Die Zeit and a popular commentator on political life.

Helmut Kohl set up his own consultancy firm and Gerhard Schroeder became a lobbyist, taking a controversial position as chairman of the board of the Russian oil giant Rosneft.

German writer David Safier has imagined a more eccentric future for Merkel, penning a crime novel called Miss Merkel: Mord in der Uckermark  that sees her tempted out of retirement to investigate a mysterious murder.

German Chancellor Angela Merkel forms her trademark hand gesture, the so-called “Merkel-Raute” (known in English as the Merkel rhombus, Merkel diamond or Triangle of Power). (Photo by Tobias SCHWARZ / AFP)

Planting vegetables
Merkel may wish to spend more time with her husband Joachim Sauer in Hohenwalde, near Templin in the former East Germany where she grew up, and where she has a holiday home that she retreats to when she’s weary.

Among the leisure activities she may undertake there is vegetable, and especially, potato planting, something that she once told Bunte magazine in an interview in 2013 that she enjoyed doing.

She is also known to be a fan of the volcanic island of D’Ischia, especially the remote seaside village of Sant’Angelo.

Merkel was captured on a smartphone video this week browsing the footwear in a Berlin sportswear store, leading to speculation that she may be planning something active.

Or the former scientist could embark on a speaking tour of the countless universities from Seoul to Tel Aviv that have awarded her honorary doctorates.

Merkel is set to receive a monthly pension of around 15,000 euros ($16,900) in her retirement, according to a calculation by the German Taxpayers’ Association.

But she has never been one for lavish spending, living in a fourth-floor apartment in Berlin and often doing her own grocery shopping.

In 2014, she even took Chinese Premier Li Keqiang to her favourite supermarket in Berlin after a bilateral meeting.

So perhaps she will simply spend some quiet nights in sipping her beloved white wine and whipping up the dish she once declared as her favourite, a “really good potato soup”.