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Professor Schwab, Colleagues, Ladies and gentlemen,

I am pleased to be back in Davos – in a very special situation this year, but I will get back to that later.

Today, when Europe is very much the focus of the discussions at this Davos Forum, I would like to recall that the First World War ended 100 years ago, in 1918. It is described as the seminal catastrophe of the 20th century. Worse catastrophes followed it. Like sleepwalkers, the politicians of the time blundered into a terrible situation. Today, 100 years later, when there are fewer and fewer surviving eyewitnesses to the Second World War, we need to ask ourselves if we have really learned from history or not. I think the generations of people born after the Second World War will need to prove whether they have really learned something.

angela merkel

The lessons of the Second World War led to the foundation of the United Nations. This was a multilateral response, a response founded on cooperation. Over 25 years ago, we experienced the end of the Cold War and of the division of the world into two blocs. This meant that for the first time, multilateralism and cooperation had an opportunity to thrive.

There was a multilateral response aimed at resolving the great challenge of 2007 and 2008, the international financial crisis. This response took the form of meetings between the Heads of State and Government of the G20, whose Presidency is held by Argentina this year. Germany held the Presidency last year and the motto of our Presidency was “shaping an interconnected world”. We tried to foster global cooperation in what is not a particularly easy time. We made progress in global cooperation in the health sector, the partnership with Africa and the global steel forum, which addresses dumping and fair trade. We tried to strengthen the role of multilateral organizations and sought to promote an open global trade system. As regards the great challenge to humankind, climate change, we had to draw our conclusions without the United States of America, unfortunately. Nevertheless, climate change remains a huge threat.

We see that national egoism exists. We see that populism exists. We see that a polarising atmosphere prevails in many countries. Perhaps there is also widespread concern about whether multilateral cooperation is really capable of solving people’s problems honestly and fairly and whether everyone can be included given the great technological challenges of the Digital Revolution and disruptive changes. There are doubts about this everywhere. And that, Professor Schwab, is why I think “creating a shared future in a fractured world” is exactly the right motto for 2018.

To be honest, the country I come from and where I am Federal Chancellor also has difficulties. We are experiencing a level of polarization not seen for decades. Germany is challenged by two events, which are also a result of globalization – the euro crisis, which we have now largely overcome, and the migration of recent years. But let me tell you that Germany – as repeatedly shown in my earlier and current talks on forming a government – wants to be a country that continues to play its part in the future in order to solve tomorrow’s problems by working together in the world. We believe that isolation is not constructive. We believe that we need to cooperate and that protectionism is not the right answer. And we believe that if we think things are not being run fairly and mechanisms are not reciprocal, then we should seek multilateral solutions, and not unilateral responses, which ultimately only serve to further isolation and protectionism.

That is why it is so important that Germany forms a government quickly. I hope we will achieve this. Two key ideas are important in the talks we are currently conducting. The first is how we can safeguard prosperity for our country and its people. At the moment, we have a situation in Germany in which we can say that we are doing well – we are doing very well. All signs indicate that in 2020 we will have enjoyed eleven consecutive years of growth. The last time we experienced that was in the 1950s. More people than ever before are in employment. We have a solid financial situation. We have made good progress as regards adopting digital technology in our business sector and with Industry 4.0. However – and I want to state this very frankly – we are not leaders in other areas of digital technology such as society and the state.

For the next four years, our job will, therefore, be to bring digital technology to our education system and bureaucracy, to give the public the option of communicating with their state via digital technology in the digital age and to create a better ecosystem for start-ups so that we remain a good place for innovation. I take this challenge very seriously indeed. We have no time to lose, as we know that other parts of the world are developing very rapidly in this regard. We also see that countries such as Estonia, which just held the Presidency of the Council of the European Union, are far more developed than a country like Germany, which is not at the top of the European league as regards digitization.

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