Merkel suggests world should adopt German economic system
Fresh from her success in persuading world leaders to agree to cut back deficits, German Chancellor Angela Merkel said Tuesday the world should adopt the German economic system.
She was speaking at a ceremony marking a monetary union 20 years ago between the East and West Germany. The deutschmark zone was a precursor to the eurozone monetary union launched in 1999, DPA reported.
Merkel said in Berlin that Germany's 20 years of experience in melding together two different types of economy could be useful in reforming global markets in the wake of the world financial crisis.
"That may sound a bit too ambitious," she said in a speech. "But I am thoroughly convinced that our way of managing an economy is extremely successful." She said the task was now to create growth that was "worldwide, sustainable and balanced."
Germany has a capitalist system that is blended with heavy regulation and massive social welfare funded by levies on payrolls.
At the weekend, a Group of 20 summit in Toronto, followed urging from Germany and Britain, agreed to seek a significant cutback in fiscal deficits by 2016. Germany has set itself a constitutional deadline to cure deficit spending by that date.
The two Germanys entered a monetary and economic union on July 1, 1990, three months before a full political unification. The East Germans, emerging from communism, were able to convert much of their savings into the harder currency, the deutschmark.
Like the European Monetary Union that began in 1990 and became irrevocable in 1999, the deutschmark union still remains controversial, with critics contending that the full blast of competition brought ruin to poorer regions with few strong exports.
Wolfgang Schaeuble, the German finance minister, rejected this Monday, saying East Germans themselves had wanted the deutschmark after 40 years in captivity in a communist state.