QUESTIONS Asked |DI PLO M AT I CA
taking in October. I do see that it will be done in a decent period of time. Two years is a tough timetable but maybe it’s possible. DM: The German parliament gave strong
approval for the Greek bailout. Can you talk a little bit about Germany's role in an economically weak EU? GW: I wouldn’t consider it to be a bailout. The German parliament adopted the necessary decisions to allow the handing out of major credit lines to Greece and other countries to enable them to lend at normal market interest rates and not to pay exorbitant interest fees. It’s not a bailout, it’s credits being given by European institutions. Behind them are directives that enable them to keep the interest rates at a normal market level. That means these countries have to repay their debt and I’m quite sure that they will. It was not a German action, alone; it was all European countries. If you look at the situation now, the economy in Europe isn’t that bad. We had, all over Europe in the second quarter of 2010, an increase of two percent, compared to the first quarter of 2010. So the GDP does rise. In Germany, we had 2.2 percent
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whether we want it or not, we are Europe ’s economic en gine . W e’re by far the lar g est economy in Europe and we’re the fourth lar g est economy worldwide in the second quarter, which is a really interesting growth. We are predicting GDP growth of three percent for Germany for 2010 and 1.9 or two percent for the EU. Of course, there are factors we can’t predict that easily. If the U.S. housing market leads to a new recession in the U.S., that will have repercussions on the Euro-zone. Our economic recovery has been driven mainly by exports to Asia, which have picked up quite considerably, and domestic demand. That means imports have increased more than exports, so we’re also helping other European partners who export products to Germany, to get their economies in better order. We have pretty
strong growth in Germany and reasonably strong growth in the Euro-zone. The Euro has stabilized nicely. But we still need a lot of budgetary and fiscal discipline in quite a number of countries. We are in for a pretty tough budget in Germany in 2011. Like Canada, we are fighting to get our house in order. DM: What was the reaction of the German people to the credits given to the Greeks? GW: The man in the street wasn’t happy initially but that has calmed down and it has been more or less accepted. DM: Can you talk about Germany’s role
as Europe’s economic engine?
GW: First, whether we want it or not, we
are Europe’s economic engine. We’re by far the largest economy in Europe and we’re the fourth largest economy worldwide, second largest exporting country. We came under fire when we announced that from 2011, the stimulus packages would end and we would start to go into austerity, softly, so it would be slow and step-by-step. We will tighten our belts in order to achieve a balanced budget by 2016. People said we’d make it harder for other European countries to recover
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