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Speech by Klaus Kinkel, Foreign Minister of the Federal Republic of
Germany at a New Year's reception given by the American Chamber of Commerce
in Germany January 22, 1998"Germany and the United States: Partners
in a New Era"
Vol. XXI, No. 4
Unofficial translation (abbreviated)
The foreign minister praised Germany's strength as a business location
and its enduring friendship and partnership with the United States. This
friendship gives both countries strength as they enter the 21st century,
a period of new and previously unimaginable opportunities, as well as
challenges. Europeans and Americans will be standing together in the new
century both to master the dangers and seize the opportunities, Kinkel
declared.
...Ladies and Gentlemen:
Two years before the turn of the century, the world is on the move. We
are all looking for the best way into the future. We Germans are united
in peace and freedom, respected around the world as a leader in the economic
and cultural spheres and have the best chances (for moving into the future).
In this context, let me say a word to the German Standort (place to do
business) discussion of past years. This discussion completely underestimated
one factor: German thoroughness and industriousness. If many of our "professional
critics" keep on, then pretty soon we Germans will be like the Swabians
who always complain how poor they are and then are insulted when somebody
believes them. So I would like to ask you today to help correct the notion
we sometimes encounter that Germany is going downhill as an investment
location. We need your help both in Germany and in the United States.
During my last trip to the United States in November, I had the positive
experience of seeing that many people there view the situation in Germany
more positively than do some German editorial boards. Many American friends
told me "Fifteen years ago the American model was declared dead in
the water. Today we're on top again, and you Germans can do it too."
My American friends were right. No other country in the world must cope
simultaneously with the challenges of unity and the changes in the world
economy. At the same time, no other country has done more to support Russia
and the Central and East European countries. We have shouldered a heavy
burden.
But still, an October 6th article in Time magazine read "Germany
in the Fast Lane." The title referred to our automobile industry,
which has catapulted to the top of the international market. It has spawned
a trend for the entire German economy. For 1998, American economists are
predicting more growth than in the U.S. -- around three percent! In 1997,
Germany had a trade surplus of more than DM 130 billion. The export nation
Number 2 is back!
I do have to make one large amendment to that statement, however. We still
have some 4.5 million unemployed in Germany. That has to change! Developments
in the last few months show us, however, that much of this unemployment
has structural causes. Germany's labor markets and social security systems
still react as slowly as unwieldy supertankers. As the unemployed are
going overboard, many believe that we can solve the problem by lowering
more and more lifeboats -- that were bought on credit. This is a tremendous
miscalculation. We can only resolve these difficulties by making the labor
market more flexible and by creating better conditions (for investment
and growth). And we need more innovation -- one invention creates more
jobs than ten laws. Two hundred thousand patents were registered in connection
with the moon landing. The U.S. took this path (of creating a flexible
job market and better conditions) and it paid off: at the beginning of
the year 1998, unemployment there was under five percent.
This is the path the German federal government is also embarking upon.
The CDU/CSU/FDP majority has done everything it its power. We have abolished
assets and business capital taxes, reduced the "solidarity tax",
introduced new energy regulations, approved a new multi-media law in record
time, eased access to risk capital, privatized Telecom, cut sick-pay benefits,
and much more. Germany is not standing still as a business location --
it is moving forward.
Ladies and gentlemen
Germany and the United States - partners in a new era.
A "unique friendship" has developed between our two countries,
as President Clinton expressed it during his visit to Berlin.
Maintenance of that friendship with the United States remains to the present
day a sort of unwritten article of our constitution, in addition to the
special relations to France and restitution to Israel and the Jewish people.
We Germans will never forget that our American friends always stood by
our side, from CARE packages and the Berlin Airlift to the reunification
of our country. Since then, the "unique" friendship has evolved
into a "matter of course" friendship, in the best sense of the
word. German firms have invested some DM 70 billion in the U.S., and American
firms have brought the same amount into Germany, DM 13 billion of which
has gone to the new states, creating or maintaining 65,000 jobs. ... Trade
volume between our two countries increased last year by over 20 percent.
For many German firms, the United States have become a second home. Within
one year, sixty German firms established branches in the state of South
Carolina alone. The new VW Beetle -- a genuine German classic -- was presented
to the world in the United States....
The foundation of our relationship is sound and goes far beyond economics
and politics. Let me cite only the 12 million American soldiers and their
families, who stood by us here in Germany during difficult times. It goes
so far that we Germans even invent American words that don't exist in
America -- for example, "Handy." We lag behind the Americans
only in self-confidence. During the live broadcast of the moon landing
in 1969, many viewers complained to the broadcaster that the American
flag was so hard to see.
Ladies and gentlemen:
Although German-American relations rest on a foundation of granite, there
will always be one or two things even good friends don't agree on. For
example, I would have liked to have seen the U.S. government go further
at the environment summit in Kyoto. The highly industrialized states of
Europe, North America and Japan are not only the biggest polluters. As
the leading developers of environmental technology, they must also adhere
to meet particularly strict standards regarding the environment.
I would also have liked to see the United States sign the anti-land mine
agreement that we concluded in Ottawa in December.
And third, you all know that our common concerns regarding the imposition
of sanctions against Cuba, Iran and Libya remain unresolved. Last week
President Clinton suspended implementation of the sanctions against Cuba
for six months. That's a good sign.
I hope that the talks now underway between the EU Commission and the EU
Presidency, on the one hand, and our American partners on the other, will
result in a comprehensive solution to the entire problem complex.
I also want to say clearly that much of the criticism currently directed
at the United States lacks substance. The U.S. has emerged from the Cold
War as the only remaining superpower. The 20th century was an American
one. But it is just this success that puts the U.S. in a difficult position.
If the Americans demonstrate leadership, people complain that they are
trying to act as the world's police. That is nonsense -- just think of
Bosnia. ... If they hold back, they are accused of protectionism. That,
too, is nonsense. Since 1990, NATO has become a guarantor of peace and
security under American leadership.
Ladies and gentlemen:
Since the end of the Iron Curtain, foreign policy issues are no longer
of primary concern to our citizens. This is true both in America and in
the Federal Republic. In the early 1980's, all of Germany discussed long-range
missiles. Today, people are concerned about unemployment, crime and pollution.
For many, foreign policy has become something abstract. The results of
summit meetings and foreign ministers' councils often cannot be summarized
in catchy slogans. This development cannot blind us to the fact, however,
that far-reaching decisions about guidelines need to be made. The bottom
line: The rules for the 21st century are being drawn up now, not in ten
years.
We are living through a period of dramatic change, a period of new dangers
but also one of incredible new opportunities that were unimaginable in
my youth.
The digital revolution has changed our lives profoundly. The trade routes
of the 21st century will be fiber optics and satellite connections. A
click of the mouse and you're in Hong Kong or New York. Globalization
transcends state borders and creates new economic branches. World trade
is growing twice as fast as the global economic growth (in 1997 +8%),
and direct investment about is increasing rapidly around the world. In
1996, a total of $349 billion was invested, an increase of 11%. China,
with a population of 1.2 billion, India with almost a billion people ,
are pushing into world markets. World currency markets have a turnover
of $1.2 billion per day. The high level of capital mobility works to the
disadvantage of states that have not kept their economies under control,
leaving them with high interest rates or a flow of capital out of the
country. Globalization and the digital revolution have created enormous
pressure to modernize. We are seeing this very clearly in the current
Asian financial crisis.... This crisis must not be allowed to spill over
into Europe....
Europeans and Americans are also standing together to secure world peace
and repulse new threats. I have mentioned Bosnia. The peace process in
the Middle East in another example. The United States is actively seeking
a renewal of the peace process....There are indications of tentative progress
in discussions between Palestinians and Israelis and we hope that the
two parties will reconcile.
Europeans and Americans are pulling together in policy on Iraq as well.
We Germans also assumed responsibility by sending an expert to be part
of the UN negotiating team.... There are many other examples of cooperation
between Europeans and Americans. To put it succinctly, we Europeans and
Americans are making our mark on the future world order. This does not
mean other states will be excluded, but that the strongest must bear responsibility....The
future global society must be an open one. Europeans and Americans must
take the lead in establishing free trade, a market economy, the rule of
law, democracy and human rights. That is the underlying basis for transatlantic
cooperation and our agenda for the coming years. ...
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