The continued European unification is one of the most important tasks facing the grand coalition during this legislative period, declared Angela Merkel. Together the CDU/CSU and the SPD aim to shape Germany’s future and to play an active part in shaping Europe’s future.

Europe has made good progress

The European Union (EU), she continued, made good progress towards achieving stability and growth in 2013. The combination of solidarity and responsibility was the right way forward.

The Chancellor congratulated Ireland and Spain, which now no longer need further assistance from the EU. She also praised the achievements of Greece, Portugal and Cyprus.

The introduction of EU-wide banking supervision has been agreed, and the regulations for winding up banks are on track. It must be ensured that tax-payers are not presented with the bill when banks fail.

In the EU’s multiannual financial framework for the period until 2020, the sums allocated for research and education have risen significantly. Angela Merkel reminded her audience that the EU member states agreed back in 2000 to spend three per cent of their gross domestic product (GDP) on research. Germany is now close to achieving this target.

Effects of the crisis can still be felt

The Chancellor also stressed, however, that in spite of all progress, we have not yet completely weathered the crisis. It is vital to tackle the root causes of the crisis, she said. There must be no repetition. She cited the high level of national debt in many EU member states, the lack of competitiveness, and undesirable developments in the financial sector as some of these root causes.

To implement the necessary reforms in member countries, the Chancellor once again advocated binding agreements between member states and the European Commission. These would have to be approved by the national parliaments. In exchange the countries would received material support.

Angela Merkel also endorsed modifying the European treaties in order to remedy the errors and omissions of the last twenty years. This is the only way, she said, to ensure greater competencies for Europe.

Germany must remain a strong base for industry

Angela Merkel also touched on the European Commission, which is expected to open an in-depth inquiry into Germany’s Renewable Energy Act (EEG), as it applies to energy intensive industries, today. "Germany must remain a strong base for industry". The government will be making this point unequivocally to the European Commission, she said. The electricity prices paid by German industry are already the highest in Europe.

In February 2014 the EU’s Commissioner for Energy Günther Öttinger will present an overview of electricity subsidies in the EU.

Respect for basic rules of democracy in Ukraine

Angela Merkel expressed her regret that Ukraine has decided not to sign the Association Agreement with the EU. She concluded that the Ukraine should not be forced into the position of having to chose between the EU and Russia in future.

Even in the wake of Russia’s loan of billions to Kyiv, she upheld the offer of an Association Agreement with the EU: "The offer is still on the table." Ukraine must, however, guarantee, "the same that we expect of every state: reasonable guarantees of the right to demonstrate and respect for the basic rules of democracy," Angela Merkel continued.

Strengthening European security and defence policy

At the European Council meeting scheduled for 19 and 20 December progress must be made on the common security and defence policy, said the Chancellor. "It must be more visible and more effective," stated Angela Merkel.

Regional partner organisations, especially in Africa, must accept responsibility for their own actions. The example of Mali demonstrates that training and equipment must go hand in hand.

Looking ahead to the European elections in 2014

Looking ahead to the elections to the European Parliament in May 2014, Angela Merkel declared that she would do all she could to help ensure that Europe developed in a positive way. "Europe is our home," she stressed. And, Europe must be strong and fair.