THE GERMAN GOVERNMENT has drawn up a growth plan for Europe in which it urges its fellow EU members to “harness the potential of the single market” while pressing ahead with structural reforms.

Angela Merkel hopes to present the eight-page document – a copy of which was seen by AFP on Tuesday – to the other EU heads of government at their next summit at the end of June, while other countries such as France and Ireland are calling for economic stimulus measures.

Fiscal orthodoxy and economic growth are “two sides of the same coin,” the document says, using a phrase which Chancellor Angela Merkel has repeated time and again in recent weeks.

“Sustainable growth cannot be bought with public spending programmes, nor with state intervention or a monetary policy that is excessively lax,” the text states.

Germany’s proposals essentially comprise suggestions for reforms to be implemented by the countries themselves and calls for better utilisation of resources and of existing European mechanisms.

Berlin urged its EU partners to “put in place conditions that are favourable to business activity, speed up the privatisation of state companies and reform their labour markets.”

At a European level, “the labour market and employment training must become more transparent,” it said.

More generally, Germany called upon member countries to “continue to exploit the potential of the single market,” for example in the areas of power networks, online trade and the construction of broadband networks.

The ministry also called for a “better utilisation of European funds” to boost competitiveness and said the capital of the European Investment Bank could be increased by €10 billion which would target infrastructure products.

- © AFP, 2012