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Merkel rejects rival?s attack over damage to eurozone economy - FT.com
Merkel rejects rival’s attack over damage to eurozone economy
By Quentin Peel in Berlin
Angela Merkel, the German chancellor, was forced to defend herself on Sunday night against the charge that she had made
the economic crisis worse for the eurozone by insisting on excessive austerity for countries such as Greece and Portugal.
In the first serious confrontation of the German election campaign, her principal challenger, Social Democrat Peer Steinbrück, used
a head-to-head television debate to call for more generous treatment of the debt-laden states of the eurozone.
“We need a second Marshall Plan,” he said, blaming Ms Merkel and her government for aggravating the economic recession, with the result that eurozone interest rates were so low that German savers were unable to earn a decent income to finance their pensions.
Ms Merkel retorted that it was essential that debt-laden countries became competitive by introducing economic reforms and that pressure must be maintained to ensure they carried out their commitments.
The German government had demonstrated its solidarity with its partners but the principle must be followed that support for their economies could only be given in exchange for their own tough reform programmes, she said.
The eurozone crisis has emerged as a key theme in the election campaign, in spite of the broad agreement between Ms Merkel’s Christian Democratic Union, and Mr Steinbrück’s Social Democratic party, on the need to finance rescue programmes.
Ms Merkel turned the tables on Mr Steinbrück by attacking his party’s proposals for tax rises, arguing that such a move would endanger the process of job creation and Germany’s role as the economic motor of the eurozone.
After the first half-hour of the debate, honour was even between the two contenders as they engaged with intensive questioning by no fewer than four television presenters in the broadcast from a Berlin studio.
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