Feisty Merkel vows not to let Germany be 'beaten up'
GERMAN Chancellor Angela Merkel expressed disappointment last night at her government's rocky first year, but insisted that unpopular decisions will pay off.
In a feisty speech she also took credit for Germany's strong economic rebound, telling her conservative Christian Democratic Union party conference that she is proud of the country's sinking unemployment and won't let Germany be "beaten up" for being a leading exporter.
Germany's economy has made an impressive comeback after contracting sharply last year -- led by exports and now helped by signs of healthier domestic demand. The number of people out of work, which topped five million only months before Merkel took office in 2005, is now below three million.
"That isn't a miracle -- it is the Germans and also we, the CDU, who managed this," Ms Merkel said.
"We promised at the height of the crisis that Germany would emerge strengthened, and what derisive criticism we had to hear," she said. "Now Germany is doing better than most."
She also renewed her defence of Germany's economic model -- it is the world's second biggest exporter after China -- against criticism of its surpluses from abroad.
Going into last week's Group of 20 summit, Ms Merkel flatly rejected US calls for setting guidelines on the size of trade gaps.
Her government spent months mired in constant internal squabbling, particularly over proposed tax cuts that were eventually shelved, before losing a major state election -- and its majority in parliament's upper house -- in May.
Since then, Ms Merkel's coalition has pressed ahead with unpopular moves such as a decision to extend the life of Germany's nuclear power plants by an average 12 years and a health-care reform that will raise employees' premiums.
The government's "balance in its first year is respectable in terms of substance -- but not always in terms of style", she told delegates.
"The disappointment at the start of the coalition is all the deeper because we waited, fought, hoped and worked for it for 11 years."
The coalition partners "had to come together anew and that was more difficult than expected," Ms Merkel said.
She added in her televised speech in Karlsruhe that her government's unpopular decisions "will later prove to be have been necessary and convince people".
The economic recovery hasn't yet helped Ms Merkel's coalition in polls. The CDU's support is around its level in last year's election, but backing for the Free Democrats has slipped by about 10pc and some surveys show a majority for the main centre-left opposition parties.
Ms Merkel's alliance also faces a tough test in an election next March in the southwestern state of Baden-Wuerttemberg, where yesterday's congress was held. Polls suggest the CDU risks losing power there for the first time since 1952.
"Throw the forecasts in the trash," Ms Merkel told delegates. "We can make it."
Delegates later re-elected Ms Merkel as party leader for a new two-year term. Running unopposed, she won about 90pc support -- a few points less than in 2008.