Merkel's conservatives promise full employment by 2025

Reuters News
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Posted: Jul 03, 2017 9:38 AM

By Andreas Rinke and Paul Carrel

BERLIN (Reuters) - Chancellor Angela Merkel's conservatives promised Germany more police, more homes and full employment within eight years when they presented their program on Monday for an election in which she will seek a fourth term in office.

With Europe's biggest economy growing robustly, Merkel's Christian Democrats (CDU) and their Bavarian sister party, the Christian Social Union (CSU), are able to offer voters tax relief and more investment after the Sept. 24 ballot.

The allies hold a clear opinion poll lead over the center-left Social Democrats (SPD), but would still need to team up with another party to govern.

On Monday they added the goal of full employment - which they define as a jobless rate of less than 3 percent - by 2025 to their list of campaign pledges.

"We think we can do this," Merkel told a news conference with CSU leader Horst Seehofer convened to present the election program, adding that jobs were central to the quest for 'prosperity and security for all'.

Germany's jobless rate is currently at a post-reunification low of 5.5 percent. A level of 3 percent has not been seen since the "Economic Miracle" boom of the mid-1970s.

The conservative parties want to add 15,000 police officers in the 16 federal states, build 1.5 million homes during the next parliamentary term, and expand Germany's broadband network.

This responds to pressure from the International Monetary Fund and European Commission, which have said Berlin has room to lift investment infrastructure, which would help reduce its current account deficit and benefit weaker euro zone peers.

EU PLANS

On foreign policy, the conservatives said they rejected full European Union membership for Turkey, backed a 'Marshall Plan'-style aid effort for Africa, and development aid spending to be increased in a 1:1 ratio with the defense budget.

They also said they are prepared to work with the new French government to develop the euro zone step by step, but oppose a mutualization of debts.

Merkel said an expanded version of the euro zone's bailout fund - the European Stability Mechanism - could play a bigger role in future crises, and perhaps act alone.

In tackling Greece's debt crisis, the euro zone has teamed up with the IMF at the insistence of German lawmakers. However, the Fund has proven a reluctant partner.

Last week, German Finance Minister Wolfgang Schaeuble said there were discrepancies between Germany, EU institutions and the IMF on whether Greece's debt was sustainable.

The CDU/CSU are polling around 40 percent, some 16 percentage point ahead of the SPD, their current coalition partner.

(Writing by Paul Carrel, editing by Emma Thomasson and Richard Balmforth)