Merz urges joint effort by all Germans to put country back on track

Germany's newly minted Chancellor Friedrich Merz on Wednesday appealed to the nation to pull together to bring the country forward again, as he gave his first government statement in parliament one week after taking office.

"The state is all of us," he said in the Bundestag, the lower house of parliament. "We can overcome all challenges, no matter how great they may be, by our own efforts."

As was to be expected, Merz, a conservative, touched on a wide array of challenges expected to occupy his administration over the next four years, from the country's struggling economy to the war in Ukraine and migration.

Opening his statement with a pledge to bring "prosperity to all" - a nod to former chancellor Ludwig Erhard who has been widely credited with Germany's post-war economic recovery - Merz said he was positive the country could be turned into a "growth locomotive" admired around the world.

Once envied across Europe, Germany's economy has suffered two consecutive years of recession as inflation, high energy prices and dropping exports weighed on businesses.

Disagreement over how kick-start the economic engine again ultimately led to the implosion of the previous centre-left coalition in November, triggering early elections that ultimately handed the baton to Merz's conservatives.

'Growth locomotive'

Merz on Wednesday promised tax breaks, infrastructure investments and cuts to red tape to turn things around.

"We can use our own strength to once again become a growth locomotive admired by the world," he said.

The chancellor said he was also banking on international trade in the efforts to revive the economy.

"We want to support the EU in concluding as many new trade agreements as possible right now," the chancellor said, adding he wanted to avoid a prolonged trade dispute with the United States.

Merz said the new government - comprised of his Christian Democrats, their Bavarian sister party and the Social Democrats - was aware of the major domestic and international challenges facing Germany - "not least with regard to public finances."

However, Germany was strong and can rely on the hard work, ingenuity, creativity and commitment of its people, Merz stressed. "Our great country can overcome the challenges of our time on its own and turn them into something good," he added.

Addressing another hot-button issue, Merz reiterated his promise to tighten migration policy, pledging more thorough border checks and more deportations.

Germany is and will remain a country of immigration, he said.

"We have allowed too much uncontrolled immigration and enabled too much low-skilled migration into our labour market and, above all, into our social security systems," he said, referring to developments over the past 10 years.

Immediately after taking office, new Interior Minister Alexander Dobrindt issued an order facilitating the rejection of asylum seekers at the country's borders, a move that critics say violates German and EU law. Vulnerable groups including pregnant women and ill people are exempt from the new rules, which have drawn criticism from Germany's neighbours, including Poland.

Germany won't become 'warring party'

Turning to the challenges facing the country abroad, Merz reaffirmed his commitment for strong support for Kiev, praising his predecessor Olaf Scholz for his efforts since the full-scale Russian invasion of Ukraine began in a rare show of appreciation for the Social Democrat.

Under Scholz's administration, Germany became Ukraine's second biggest supplier of military aid behind the United States, a fact amplifying the responsibilities facing the new government in light of changed US priorities under Donald Trump.

Merz also echoed another stance upheld by his predecessor, who always justified his refusal to supply Ukraine with long-range weapons with concern that such a step could draw Germany into the war.

"One thing is clear: We are not a party to the war and will not become one," the conservative said.

But in a possible sign that he might still take a slightly less cautious approach than Scholz, Merz added: "But we are also not an uninvolved third party or neutral mediator between the fronts, so to speak."

Merz has repeatedly signalled that he is open to supplying Ukraine with German-made Taurus cruise missiles, which would enable Kiev to strike targets on Russian soil well beyond the front line, but has stressed he would only do so in coordination with European partners.

Appeal for trans-Atlantic unity

When it comes to negotiations with Russia on an end to the war in Ukraine, Merz said he would advocate for trans-Atlantic unity.

"It is of paramount importance that the political West does not allow itself to be divided," said Merz.

"That is why I will continue to make every effort to ensure the greatest possible unity between the European and US partners."

The U-turn in US foreign policy has fuelled fears that the administration of Donald Trump could make concessions to Russia in peace negotiations with Ukraine.

So far, Washington's European allies have been largely sidelined in the US-Russia talks initiated by Trump.

Merz stressed that Ukraine can't be forced into agreeing to a peace agreement against its will.

"We hope and we are all working hard to ensure that this clear stance is not only taken everywhere in Europe, but also by our US partners," he said.