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Posts Tagged ‘Merkel’

Protectionism is world economy’s key ‘danger’: Merkel

In Uncategorized on November 9, 2010 at 6:21 am

Merkel says German multi-cultural society has failed

In Uncategorized on October 19, 2010 at 4:19 pm

 Germany’s attempt to create a multi-cultural society has failed completely, Chancellor Angela Merkel said at the weekend, calling on the country’s immigrants to learn German and adopt Christian values.

Merkel weighed in for the first time in a blistering debate sparked by a central bank board member saying the country was being made “more stupid” by poorly educated and unproductive Muslim migrants.

“Multikulti”, the concept that “we are now living side by side and are happy about it,” does not work, Merkel told a meeting of younger members of her conservative Christian Democratic Union (CDU) party at Potsdam near Berlin.

German Chancellor Angela Merkel, pictured in Potsdam on Saturday at a conference of younger members her Christian Democratic Union party, told the meeting that Germany’s attempts to create a multi-cultural society in which people from various cultural backgrounds live together peacefully have failed

“This approach has failed, totally,” she said, adding that immigrants should integrate and adopt Germany’s culture and values.

“We feel tied to Christian values. Those who don’t accept them don’t have a place here,” said the chancellor.

“Subsidising immigrants” isn’t sufficient, Germany has the right to “make demands” on them, she added, such as mastering the language of Goethe and abandoning practices such as forced marriages.

Merkel spoke a week after talks with Turkish Prime Minister Recep Tayyip Erdogan in which they pledged to do more to improve the often poor integration record of Germany’s 2.5-million-strong Turkish community.

Turkish President Abdullah Gul, in a weekend interview, also urged the Turkish community living in Germany to master the language of their adopted country.

“When one doesn’t speak the language of the country in which one lives that doesn’t serve anyone, neither the person concerned, the country, nor the society,” the Turkish president told the Suedeutsche Zeitung.

“That is why I tell them at every opportunity that they should learn German, and speak it fluently and without an accent. That should start at nurseries.”

German President Christian Wulff was due for a five-day visit to Turkey and talks with the country’s leaders on Monday.

The immigration debate has at times threatened to split Merkel’s conservative party, and she made noises to both wings of the debate.

While saying that the government needed to encourage the training of Muslim clerics in Germany, Merkel said “Islam is part of Germany”, echoeing the recent comments of Wulff, a liberal voice in the party.

Horst Seehofer, the leader of the CDU’s Bavarian sister party, CSU, who represents the right-wing, recently said Germany did not “need more immigrants from different cultures like the Turks and Arabs” who are “more difficult” to integrate.

While warning against “immigration that weighs down on our social system”, Merkel said Germany needed specialists from overseas to keep the pace of its economic development.

According to the head of the German chamber of commerce and industry, Hans Heinrich Driftmann, Germany is in urgent need of about 400,000 engineers and qualified workers, whose lack is knocking about one percent off the country’s growth rate.

The integration of Muslims has been a hot button issue since August when a member of Germany’s central bank sparked outrage by saying the country was being made “more stupid” by poorly educated and unproductive Muslim migrants with headscarves.

The banker, Thilo Sarrazin, has since resigned but his book on the subject — “Germany Does Itself In” — has flown off the shelves, and polls showed considerable sympathy for some of his views.

A recent study by the Friedrich Ebert Foundation think tank showed around one-third of Germans feel the country is being “over-run by foreigners” and the same percentage feel foreigners should be sent home when jobs are scarce.

Nearly 60 percent of the 2,411 people polled thought the around four million Muslims in Germany should have their religious practices “significantly curbed.”

Far-right attitudes are found not only at the extremes of German society, but “to a worrying degree at the centre of society,” the think tank said in its report.

“Hardly eight weeks have passed since publication of Sarrazin’s theory of decline, and the longer the debate continues to a lower level it falls,” the weekly Der Spiegel commented Sunday.

Source: SGGP

Germany’s Merkel urges China to open up markets

In Uncategorized on July 16, 2010 at 8:46 am

BEIJING, July 16, 2010 (AFP) – German Chancellor Angela Merkel on Friday prodded China to ease access to its markets as the leaders of the world’s top two exporting nations held talks in Beijing focused on trade.

Angela Merkel (L) walks beside Chinese Premier Wen Jiabao (R) during a review of the honour guard welcoming ceremony at the Great Hall of the People in Beijing on July 16, 2010. AFP

After meeting Premier Wen Jiabao, Merkel told reporters that she had emphasised German wishes for greater openness in the world’s third-largest economy.

“Chinese companies, like those of many other countries, enjoy very good access to the German market. We hope that German enterprises can enjoy the same access to the Chinese market,” she said.

Trade between the two countries has grown rapidly to 91 billion dollars last year, up from 41 billion dollars in 2001, according to Chinese data.

However, in the past few years, the trade balance has tipped decisively in China’s favour, with Chinese exports to Germany totalling 55 billion dollars last year, while trade in the other direction amounted to 36 billion dollars.

“Neither Germany nor China pursues a trade imbalance,” Wen said during a joint press conference after their talks.

“We hope that trade can be balanced and orderly.”

The two sides signed several agreements covering trade, energy, and culture.

They included an agreement between Shanghai Electric Group of China and Siemens AG on research and development of steam and gas turbines worth 3.5 billion dollars, according to Chinese state media.

Foton Motor of China and Daimler-Benz AG also sealed a deal on a joint venture to make trucks.

Merkel was to meet with President Hu Jintao later in the day.

Source: SGGP

Merkel on the ropes after presidential humiliation

In Uncategorized on July 2, 2010 at 6:30 am

BERLIN, July 1, 2010 (AFP) – German Chancellor Angela Merkel was left licking her wounds Thursday after rebels in her coalition turned a routine presidential vote into a damaging debacle that left her bruised and weakened.

It took nine hours and three rounds of voting by a special assembly of MPs and public figures on Wednesday for Merkel’s candidate Christian Wulff to be elected to the largely ceremonial post of head of state.

Christian Wulff and his wife Bettina Wulff leave the Reichstag building after he was elected German President on June 30, 2010 in Berlin. AFP

With Merkel’s coalition holding a majority in the assembly, the election should have been a shoo-in in the first round, but a handful of rebels voted against Wulff in the secret ballot in a blow to the chancellor’s authority.

Following embarrassing and dramatic first two rounds, the nail-biting third became in effect a battle for the political future of Merkel, four times named the world’s most powerful woman by Forbes Magazine.

“The double failure of Christian Wulff in the presidential vote has brought the Merkel government to the brink of collapse,” wrote the left-leaning Frankfurter Rundschau daily.

Influential mass circulation Bild daily said the vote debacle “could be the beginning of a gradual process of capitulation by the government”, and questioned Merkel’s leadership ability.

“Wulff’s election is Merkel’s defeat,” said the daily Berliner Zeitung while Der Spiegel magazine said on its website it was her “biggest failure.”

In his acceptance speech, the 51-year-old Wulff, a former leader of Lower Saxony, home to carmaker Volkswagen, made an appeal for unity after what the Tagesspiegel daily dubbed “the day of the long knives” for Merkel.

“We all need to take responsibility for our country,” said Wulff, after a rousing standing ovation from Merkel’s supporters in which the sense of relief was palpable.

A relieved but sombre Merkel appeared briefly before the cameras to say that Wulff would be a “wonderful” representative for Germany but made no mention of the rebellion within the ranks.

The stakes for Merkel could hardly have been higher. A recent poll in Bild showed that 48 percent of Germans wanted her to throw in the towel if her man did not get elected.

Wulff’s rival for the job, former pastor and East German dissident Joachim Gauck, 70, enjoyed more popular support, polls showed.

Political expert Juergen Falter hinted the bitter rebellion in Merkel’s ranks could spell the beginning of the end of her second term at the helm of Europe’s top economy.

“The fact it went to a third round of voting means the seed of mistrust that has already been planted could begin to bloom … in any case, the mistrust in this government that is already there will continue,” he told Tagesspiegel.

The fiasco capped a rough few months for Merkel, 55, after she won a second term in September at the head of a new-look coalition more to her liking than her previous tie-up with the Social Democrats.

She has seen her popularity nosedive over her handling of the eurozone crisis and has come under fire for plans to slash government spending by more than 80 billion euros (100 billion dollars) over the next four years.

The left-leaning paper Sueddeutsche Zeitung said: “Merkel was not standing for election, but she is the loser of the day … she has been exposed, and this vote is the writing on the wall.”

The Financial Times Deutschland demanded a change in her style, often criticised for being too hesitant.

The presidential vote was “the last warning,” said the paper. “Merkel must now reinvent herself and her chancellorship … show a clear will for political leadership and a clear position on what projects are close to her heart.”

“One could perhaps expect her to explain why she wants to govern.”

Source: SGGP

Twin resignations batter crisis-weary Merkel

In Uncategorized on June 1, 2010 at 7:44 am

BERLIN, June 1, 2010 (AFP) – German Chancellor Angela Merkel, battered from all sides for her response to Europe’s economic crisis, was in more hot water Tuesday after the second high-profile resignation within a week.

Only six days after Roland Koch, the outspoken premier of Hesse, home to banking capital Frankfurt, stepped down, President Horst Koehler shocked Germany Monday with an emotional resignation. Both moves came out of the blue.

AFP FILES – Picture taken on November 25, 2009 shows German President Horst Koehler (L) greeting Jens Boehrnsen, mayor of the northern German city of Bremen, at Bellevue Palace in Berlin.

Analysts said the loss of two heavyweights from her centre-right Christian Democratic Union (CDU) was a fresh headache for the Merkel, already suffering from plunging popularity ratings less than a year into a second term.

“She has lost Koch, she is losing Koehler, who is not very important in terms of political power, but it is symbolic and it could create some panic,” political scientist Nils Diederich from Berlin’s Free University told AFP.

“If she doesn’t manage to get a grip on her political agenda in the coming weeks, she is not going to serve out her full term,” he added.

Merkel, 55, said she “wholeheartedly” regretted Koehler’s resignation and admitted she would miss the advice of the former head of the International Monetary Fund, particularly on economic and financial issues.

And she now finds herself having to identify, within 30 days, a candidate for the largely ceremonial post who would be acceptable to all sides of her squabbling coalition of conservatives and pro-business Free Democrats.

“Koehler’s resignation in the midst of the euro-crisis could push Angela Merkel’s … coalition into severe difficulties,” commented influential mass circulation daily Bild.

“Merkel has already lost CDU-mentor Roland Koch. This is another serious setback,” the paper added.

However, another political analyst, Lothar Probst, from the University of Bremen, played down the consequences for Merkel, stressing that “for the moment, no one is calling for her to step down.”

“If she can bring some calm to the coalition, she can still finish her term without too much damage,” he told AFP.

But the resignations represented the latest in a string of political reverses both at home and abroad for Merkel, last year voted Forbes magazine’s most powerful woman for the fourth consecutive time.

Domestically, she lost a key regional election on May 9 that cost her the majority in Germany’s upper house.

Further afield, she has been slammed for what is seen as a hesitant response to the fiscal crisis in Greece and faces a flood of fiscal red ink herself that may mean she has to raise taxes after campaigning on a promise to cut them.

Meanwhile, 39 German soldiers have died since 2002 in Afghanistan in a mission that is bitterly unpopular in the country.

It was Afghanistan that caused the resignation of the 67-year-old Koehler after he came under fire for comments about Germany’s overseas military action in which he appeared to justify the mission in terms of commercial gain.

As for Koch, he said he was stepping down to work in the private sector, denying furiously that he was leaving due to a spat with Merkel, whose meteoric rise is widely seen to have caused resentment in the 52-year-old.

After Koehler stepped down, Merkel said: “I think that the German people will be very sad about this resignation.”

And according to the Frankfurter Allgemeine Zeitung, Merkel too has reason to be sad.

Koehler’s “act of desperation” in resigning “does not augur well for the future of this coalition,” the influential daily said in an editorial.

Source: SGGP

German leader Merkel goes from glories to disgrace

In Uncategorized on May 31, 2010 at 5:17 am

It was only nine months ago that Forbes magazine named German Chancellor Angela Merkel the world’s most powerful woman for the fourth year in a row.

She impressed Germans and foreigners alike with her ascent to power — an East German pastor’s daughter who took control of the male-dominated conservative party and won elections in Europe’s economic powerhouse, becoming Germany’s first female chancellor in 2005.

She was lauded for hosting the world’s top leaders at the G-8 summit in Heiligendamm in 2007 with ease and professionalism. She repaired relations with the United States that were strained over the Iraq war, and she positioned herself as a political heavyweight on the continent. It seemed that no major political and economic decision could be made in Europe without Merkel’s approval.

German Chancellor Angela Merkel

But over the last few months, the German chancellor’s handling of Europe’s economic crisis has made her widely disliked at home and increasingly isolated and even reviled abroad.

On the international stage, Merkel, 55, has been criticized for dragging her feet for months over a bailout package for Greece and being too focused on German national interests.

“For months, Mrs. Merkel resisted all appeals — by other European leaders and Washington — to, well, be a European leader,” The New York Times wrote in an editorial Wednesday.

On the same day, EU Commission president Jose Manuel Barroso criticized Germany for its role in the euro currency crisis and said it would be “naive” to believe that EU treaties could be changed according to German wishes without other nations wanting amendments as well. Barroso was referring to Germany’s insistence that European Union treaties be changed to allow tougher sanctions for countries that have excessive government debt.

In an interview with the German daily Frankfurter Allgemeine Zeitung, Barroso said “our union needs Germany in a leading role” and added he wants to see Germany “speak up for Europe. Otherwise, we have a problem.”

Concerned about German state elections in North Rhine-Westphalia in early May, Merkel had tried to postpone a decision on the Greek bailout until after the election. In the end, her European partners pushed her into supporting the rescue package just days before the election — which Merkel’s party then lost.

“This (behavior) shows a fatal German inclination for isolationism that one had thought belonged to the past,” German daily Tagesspiegel wrote in an editorial Saturday. “This does not only make our partners suspicious of us, but is also completely senseless in today’s globally connected world.”

Now, like her colleagues in Greece, Spain, Britain, Portugal and Italy, Merkel is struggling to prepare a worried populace for budget cuts. The chancellor has already scrapped plans for promised tax cuts, but still faces a huge federal budget deficit. Her government is going to decide on spending cuts and, possibly, even on tax hikes within the next 10 days.

“For weeks, you’ve tried to sit on the fence and not get involved,” opposition leader Frank-Walter Steinmeier of the left-leaning Social Democrats scolded Merkel during a parliament debate about the Greek rescue package. “You’ve let things slide and now that everything is ablaze, you’re calling for the firefighters to solve the problem.”

Domestic critics have noted repeatedly that her new coalition has accomplished little in the seven months since it took control. Her popularity among Germans has plummeted by 10 points to 48 percent — her worst showing since late 2006.

Opposition lawmakers accuse the chancellor of lacking any vision or leadership when it comes to essential issues like an aging population, integrating immigrants into German society or tackling the question of whether to continue using nuclear energy.

Merkel has not responded directly to the criticism and her office could not immediately be reached for comment Saturday.

The chancellor’s unilateral ban earlier this month on naked short-selling of eurozone government debt and shares of major financial companies received praise — but also criticism, because she made the decision without consulting the 15 other nations that share the euro currency with Germany.

“Germany is still the most important economic power on the continent,” Tagesspiegel wrote. “But while other powers used to look at Merkel for orientation … today she seems to be confused and changing her position according to the influential powers around her.”

Of 1,000 people surveyed by Infratest dimap this week, 58 percent said they thought Merkel’s previous coalition government of her conservatives and the center-left Social Democrats was better than the new coalition Merkel formed in October with the business-oriented Free Democrats.

Only 34 percent said Merkel’s government had made the right decisions to counter Europe’s government debt crisis.

“Merkel, the crisis-managing chancellor, has turned into a chancellor in crisis herself,” the daily Welt newspaper wrote on Friday.

Source: SGGP

As Europe burns, Merkel feels the heat

In Uncategorized on May 30, 2010 at 5:17 am

BERLIN, May 30, 2010 (AFP) – German Chancellor Angela Merkel, according to Forbes magazine, is the most powerful female on the planet. But lately, she has also looked one of its loneliest.

Barely half a year into her second term at the head of Europe’s biggest economy, the 55-year-old has found herself under fire at home and abroad over a whole range of issues, with the Greek debt crisis top of the list.

German Chancellor Angela Merkel and Brandenburg’s State Premier Matthias Platzeck inspect the flood water from the banks of the River Oder on the Polish border on May 29, 2010. AFP photo

But her actions are largely explained by severe political pressure at home, commentators say.

With Greece teetering on the edge of financial meltdown a few weeks ago, Merkel was accused of foot-dragging over riding to the rescue together with Germany’s European Union partners and the International Monetary Fund.

Similar charges were levelled when it came to arming Europe with a trillion-dollar fire extinguisher to stop the flames spreading to other debt-ridden eurozone members such as Portugal and Spain.

“When Germany finally agreed to contribute to a bailout fund — under threat of a Continentwide crash — Europe’s economic problems were far worse, and Germany and others had to ante up a lot more cash,” a New York Times editorial said.

Then came Germany’s surprise ban on naked short selling — risky investment bets — that together with an alarmist warning about the euro’s future from Merkel wiped billions off stock markets and sent the single currency tumbling.

Like so much of Merkel’s recent behaviour, this short-selling ban, and plans to widen it by law, have “a domestic political background,” said Ralf Jaksch from the Centre for European Politics (CEP).

“A majority of lawmakers in the government coalition only voted in favour (of the eurozone bailout) with great pains and were far from convinced it was the right thing to do,” he said.

Germany’s response to the eurozone crisis, pressing for tighter EU budget rules, has hit choppy waters too, with the president of the European Commission, Jose Manuel Barroso, slamming Germany as “naive.”

Much to Merkel’s annoyance, others have also lashed out at Germany’s export prowess, the fruit in part of government efforts not mirrored elsewhere in Europe to keep wages down, calling on her to boost consumer spending instead.

US Treasury Secretary Timothy Geithner made a pointed comparison with China in Berlin last week, saying Beijing was “recognising that imperative” to boost domestic demand. He did not repeat the compliment for Germany.

Bild, the mass-circulation daily, has treated Merkel to a roasting over Greece, screaming in mid-May: “Yet again, we are the mugs of Europe.”

Broadsheets have scarcely been kinder, and the German public is even showing growing signs of falling out of love with the European project because of the recent turmoil.

A disastrous election result on May 9 in North Rhine-Westphalia robbed Merkel’s governing coalition of its majority in the upper house, constricting her ability to pass legislation in the future.

The parlous state of Germany’s public finances have forced Merkel to rule out delivering on her re-election promises to slash taxes, and there is speculation now that taxes might even rise.

And with 2011 “super election year,” with six of Germany’s 16 states going to the polls, domestic considerations are set to continue to dictate Merkel’s behaviour for the foreseeable future.

“If all these elections go the same way as North Rhine-Westphalia … then Merkel is going to find things even tougher,” Gerd Langguth, political science professor at Bonn University, told AFP.

Source: SGGP

Euro rescue package ‘just buys time’: Merkel

In Uncategorized on May 16, 2010 at 12:58 pm

German Chancellor Angela Merkel addresses a press conference at the Chancellery in Berlin on May 10. AFP photo

BERLIN (AFP) – A trillion-dollar package to shore up ailing eurozone economies merely buys time until the deficits of certain members of the 16-member zone are cleaned up, German Chancellor Angela Merkel said Sunday.

Speaking at a conference of the Confederation of German Trade Unions, Merkel said that recent speculation against the euro “is only possible because of huge differences in the economic strengths and debt levels of member states.”

With the rescue package, “we have done nothing more than to buy time until we have brought order to these competitive differences and to the budget deficits of individual euro countries,” she said.

The giant fund of loan guarantees, for which Germany will have to make available up to around 150 billion euros (186 billion dollars), was agreed in emergency talks in Brussels last Sunday.

Dubbed “shock and awe”, the package briefly cheered markets and offered some respite to the plunging euro, but doubts quickly resurfaced about the ability of governments to push through crippling cuts to conquer their deficits.

Speaking a day after the joint agreement between the European Union and the International Monetary Fund was clinched, Merkel said it served to “strengthen and protect the common currency.”

The wider package followed a 110-billion-euro bailout deal for debt-wracked Greece, which was hugely unpopular in Germany and contributed to a shattering defeat for Merkel last Sunday in a key regional election.

“What happened in Greece, that is to say the year-on-year falsification of statistics, is completely unacceptable,” Merkel said.

Source: SGGP

Merkel rules out tax cuts ‘in foreseeable future’

In Uncategorized on May 10, 2010 at 12:47 pm

BERLIN, May 10, 2010 (AFP) – Chancellor Angela Merkel on Monday ruled out tax cuts in Europe’s biggest economy, a key election pledge, “in the foreseeable future” following a “bitter defeat” in a key state poll.

“[In] my view no tax cuts will be possible in the foreseeable future,” Merkel told reporters, adding that this meant “at least two years — the budgets for 2011 and 2012.” Her current term runs until 2013.

In general elections in September, Merkel ditched the centre-left coalition partners in favour of a new alliance with the pro-business Free Democrats (FDP), promising voters billions of euros (dollars) in tax cuts.

A trader sits in front of a board displaying the German share index DAX on May 10, 2010 at the stock exchange in Frankfurt/M., western Germany. AFP photo

“Looking further ahead in politics is always very difficult because many things happen differently than one can predict with forecasts today,” Merkel said.

Merkel said that instead of cutting taxes, her government would focus on simplifying the taxation system.

Merkel’s Christian Democrats (CDU) were also in an alliance with the FDP in the western state of North Rhine-Westphalia (NRW), Germany’s most populous, but voters threw out the coalition in an election on Sunday.

Experts said that the defeat was down in large part to Merkel’s decision to contribute to a massive bailout of Greece, and to squabbling in her new coalition.

“We have suffered a bitter defeat,” Merkel said.

“As regards the work of the federal government I will only say this: In the first months (of the new coalition) we did not provide any momentum to the government in NRW.

“On the contrary, we were a factor holding them back, and there were many avoidable disagreements.”

The election in NRW means Merkel’s coalition no longer has a majority in the upper house of parliament, making the passage of legislation harder. But she ruled out any cabinet reshuffle.

Source: SGGP

Victorious Merkel prepares new German coalition

In World on September 29, 2009 at 6:52 am

 Angela Merkel set to work Monday on a new centre-right coalition after clinching a second term, but warned Germans of a hard road ahead to revive the sickly economy and rescue vanishing jobs.

The conservative chancellor secured another four-year mandate with enough votes to dump an awkward “grand coalition” with the Social Democrats (SPD) for an alliance with the pro-business Free Democrats (FDP).

“We want to use this opportunity in an economically difficult time to save jobs, create new jobs and boost growth decisively,” said Merkel, Germany’s first female leader and its first chancellor from the former communist east.

“I am very satisfied and happy with yesterday’s results and intend to start the new legislative term full of momentum and energy,” she told reporters at the headquarters of her Christian Democrats (CDU) Monday. Reax: World leaders congratulate Merkel

Interactive graphic on Germany as Chancellor Angela Merkel sets to work on a new centre-right coalition after clinching a second term.

Voters on Sunday rewarded the 55-year-old leader, dubbed most powerful woman on Earth by Forbes magazine for four years running, for shepherding Europe’s biggest economy through its worst post-war downturn.

Although the popular Merkel savoured her victory, the daily Tagesspiegel said the 33.8-percent result by the CDU and its Christian Social Union (CSU) affiliate, their worst since 1949, marked a “black eye” for the chancellor.

It took the FDP’s record 14.6-percent score to give the alliance a majority in parliament. The champions of free trade and lower taxes will return to power for the first time since conservative Helmut Kohl led Germany 11 years ago.

FDP leader Guido Westerwelle aims to become the country’s first openly gay foreign minister.

He told a news conference that he would actively support US President Barack Obama’s disarmament efforts and work to get Europe’s top economy back on its feet with tax cuts despite mounting public debt.

“We will of course be persistent about our electoral platform in negotiations (on a coalition),” he said.

“Fair taxes do not endanger state finances, to the contrary, they are the precondition for economic growth, jobs and indeed healthy state finances.”

An analyst from polling institute Allensbach, Renate Koecher, said the FDP’s election-night tally may have been inflated by voter tactics.

“A big part of their success can be explained by the fact that CDU voters wanted to make sure that the grand coalition would not return,” she said.

Merkel’s bloc and the FDP have a comfortable 332 seats in the 622-member parliament. The chancellor and Westerwelle were to meet behind closed doors Monday, with the coalition expected to be formed within about a month.

The SPD with Frank-Walter Steinmeier, the outgoing foreign minister, as candidate for chancellor, crashed to 23 percent, its worst post-war result, and will be consigned to the opposition benches after 11 years in government.

Merkel identified her “top priority” as tackling unemployment, which stands at 8.3 percent but is forecast to surge in the months ahead, as firms lay off workers on part-time schemes.

Holger Schmieding, head of European economics at Bank of America Merrill Lynch in London, said the vote was “not a revolution.”

He did not forecast dramatic changes but said: “There will be some tax reforms over the next four years, and there will probably be some move towards deregulation modestly in the labour market, and probably some changes in the health-care system.”

On top of its success in the race for the Bundestag lower house of parliament, the centre-right appeared to do well enough in two state polls held Sunday to give the alliance a majority in the Bundesrat upper house, assuring smoother passage of legislation.

On foreign policy, Germany’s mission in Afghanistan is highly unpopular and could become a major domestic headache for Merkel if an insurgency in the north where its 4,200 troops are based continues to escalate.

The deployment in Afghanistan prompted a series of threats from Al-Qaeda leader Osama bin Laden and German-born Islamic extremists before the elections.

Source: SGGP