She appealed to member states to surrender national powers to Brussels, and to consider amending the treaties. In her address the Chancellor called for a critical analysis of the errors built into the foundations of the economic and currency union at the outset, so that these can then be remedied. Four factors, she declared, are crucial if Europe is to emerge stronger from the crisis, and if we are to ensure that a crisis of this sort does not recur:

A renewed economic and currency union needs more

Common financial market policy

• Common fiscal policy
• Common economic policy
• Democratic legitimation and control.

Over and above this, it would be a good idea to put in place a European-level right of intervention in national budgets where these fail to comply with the agreed ceilings as laid out in the Stability and Growth Pact, she added.

Rekindling Europe’s strengths

The first successes can already be seen on our way to mastering the crisis, said the Chancellor. But we cannot afford to rest on our laurels. "Indeed, at all levels of the Union we must ensure, step by step, that the strengths of Europe can be rekindled," declared Angela Merkel. These include the liberty, dynamism and prosperity that the European Union offers its members, as well as the weight and importance that the EU gives member states in the wider world.

Angela Merkel called on her audience to stabilise the economic and currency union in the long term. "We must be ambitious and demanding, and we must not be afraid to change the treaty on which the economic and currency union is based if this proves to be necessary."

Once again she suggested that a new financing instrument in the euro zone could generate specific incentives to support reform measures on the basis of solidarity.

The euro – more than just a currency

The Chancellor repeated her conviction that the euro is far more than just a currency. It is the "symbol of the successful, peaceful and democratic unification of Europe, the symbol of a Europe that stands for liberty, prosperity and progress".

She pledged that "Germany will do everything it can to ensure that in future too the European Union can uphold its pledge to bring liberty and prosperity."

The European Parliament – a partner

Angela Merkel proposed a stronger dialogue between the national parliaments of member states and the Members of the European Parliament. This would help the national parliaments exercise their duties in ensuring a sound future for the Union. She appealed to her audience, "A renewal of the foundations on which the economic and currency union stands is important for the wellbeing of the people of Europe, who you represent in this Parliament at European level. I am thus counting on your support!"

To ensure genuine dialogue between European and national level, Angela Merkel would like to see a new, tiered, differentiated procedure, in which member states, with the approval of their parliaments, enter into binding and enforceable reform agreements with the European level.

National parliaments, and governments, will increasingly perceive and accept the responsibility they bear for integration.

"Together we are Europe. Europe is also domestic policy. Together we can create a strong, stable Europe," underscored the Chancellor.