"We now have the highest rate of employment since reunification, and since 2014 we have managed without any new debts," pointed out the Chancellor at the start of her address. The efforts of the German government to continue without any new borrowing, she said, is "anything but self-evident". Next year, for the first time since 2002, Germany’s debt will again be below the level laid out in the convergence criterion, i.e. public debt will be no higher than 60% of GDP. This, said Angela Merkel, is a question of fairness towards the generations to come.

Unsettling news from around the world

The Chancellor sees one priority in foreign and security policy. The world, she said, has become "more unsettled and more complex". The security policy environment has changed. Angela Merkel stressed how important it is that Germany is part of NATO and the European Union. "No one nation can guarantee security alone," she said.

She reiterated her support for the nuclear deal with Iran. Iran is meeting its commitments under the provisions of the agreement, according to the information provided by the International Atomic Energy Agency (IAEA), reported Angela Merkel. From the point of view of the German government it is not right to withdraw from the agreement in this situation, as the USA has done, although the deal is not ideal and Iran’s ballistic missile programme and its actions in Syria and in other conflicts in the Middle East represent a threat to Israel. Angela Merkel nevertheless considers that transatlantic relations are still exceedingly important. "They must be strong enough to withstand differences of opinion".

Closer EU cooperation on defence

The Chancellor believes that close cooperation on defence within the EU is the right way forward. Germany will play a more active role, she said. She defended the significant increase in Germany’s defence budget over the next few years. "This is not a military build-up. It is a question of making sure we have the equipment we need," she said. Troops must have the equipment to enable them to be effective in foreign missions while still coping with the increasing responsibilities in the field of national defence and NATO defence.

At the same time Angela Merkel praised the approach taken by the German government of raising defence spending and development spending one to one. It is the common responsibility of Europe to drive development in Africa, largely through private-sector investment alongside state funding, she said.

Migration must be managed and regulated at European level, said Angela Merkel. "This is an issue that will occupy us for years, for decades to come." The European border management agency Frontex must be strengthened, she said.

Digitalisation is an ambitious project

The Chancellor described digitalisation as the most ambitious project for Germany, but also for Europe’s competitiveness. It is a question of how we shape the radical changes in society that come with digitalisation. Efforts to date are still inadequate, she stated.

"We also need to steadily digitalise our authorities and administration. All citizens must have access to the heads of all authorities," said the Chancellor. She announced that the digital cabinet and the newly founded digital council would be meeting soon.

Crisis-proofing the eurozone

Angela Merkel also advocated strengthening Economic and Currency Union. In a crisis-proof EU, developing the ESM to a European monetary fund could play a major role, said the Chancellor, and asked, "What should be covered by the EU budget and what by the euro budget?"

A stable budget in Germany is difficult to reconcile with significantly larger contributions to the various EU funds. Germany will be discussing how to reconcile these demands with France. Angela Merkel declared her confidence that unresolved financial questions regarding the EU budget can be resolved before the European Council meets in June.

Before the EU-Western Balkans Summit, which will begin tomorrow in Sofia, Angela Merkel stressed that the Western Balkan states must have European prospects.

Accession prospects of the Western Balkan states