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Ministers,

Ambassadors,

Excellencies,

My esteemed colleague!

First of all may I thank you all very much indeed for your hospitality. I would like to thank the citizens of Croatia. I would also like to express warm thanks to the representatives of the world of politics gathered here today. My delegation feels honoured by your presence, which is highly appreciated. I am most grateful for your keen interest.

Next year will be a great year for Croatia. In 2011 you will be celebrating the 20th anniversary of the day your country regained full independence.

On its path to EU membership Croatia is now on the final straight.

If it musters all its energies for one last spurt, it may be possible to conclude the accession negotiations in the near future, possibly even next year. I certainly hope so.

With the ratification of the accession treaties, the way will be clear for Croatia to become the twenty-eighth member of the European Union.

The path to EU membership, as you know from your own experience, is tough going. It entails much hard work. But all the hard work is definitely worth it.

Europe means greater freedom, greater security and greater prosperity for everyone.

But even more important, European integration has, right from the start, been a unique project for peace. The old paradigm of confrontation in Europe has given way to a new paradigm of cooperation and integration.

For the younger generation war in the European Union is utterly unthinkable – and rightly so. But millions living in our continent today have experienced at first hand the devastation wrought by the Second World War, and their parents – or in the case of my own generation, their grandparents – also lived through the horrors of the First World War.

We must never forget that European integration has given us an era of peace – something which for centuries in Europe remained only a dream.

So let me appeal to all those who are often very quick to criticize Europe and the European Union to reflect once again on what Europe has given us. If Europe and the European Union had given us no more than this era of peace, it would still have been worth it. Peace – this was the grand idea that inspired Europe and the European Union. And this peace is something we must strive for and defend every day anew. That is the historic task for which our generation is responsible. And the historic task of the younger generation is to recognize that peace cannot be taken for granted and that the European Union and the cooperation it stands for is the prime reason for the amazing progress our continent has experienced in recent decades.

In South-East Europe, too, the prospect of EU membership has facilitated peace and reconciliation. Good neighbourly relations, regional cooperation and the will to settle all bilateral issues by peaceful means – that is the essence of European integration.

The European Union stands for a democratic concept of the state. The EU stands for states that have citizens, not subjects, which defend their citizens’ rights and also protect their minorities. The EU stands for states that are committed to the peaceful resolution of disputes, whether they occur within their own societies or in the wider world.

It is precisely because the EU guarantees an unprecedented degree of peace, freedom and security that it is seen by many people today as the main reason why Europeans are globalization winners.

In this global age the EU is the insurance policy that keeps us prosperous.

In a world of global competition the countries of Europe can hold their own far better as a Union than by standing alone. That they have opted to renounce national competences and adopt common rules for trade and economic activity translates into gains for Europe’s citizens.

This is often discussed with a critical undertone in EU member states, but let us not forget all the tangible benefits apart from peace and prosperity that the EU has brought. It has made a genuine and positive difference to people’s daily lives.

I will cite just some examples. Since the EU freed up the telecommunications market, phone calls in Germany, for example, have never been so cheap. A long-distance call that fifteen years ago cost several Deutsche Mark now costs just a few cents. European law has also liberalized the natural gas market, which has resulted in falling prices and greater security of supply.

In 16 EU member states people pay today in a common currency. The EU internal market means companies can sell their products to 450 million potential customers. Clearly that spells opportunities not just for the big names, which in any case operate globally, but above all for the small and medium-sized enterprises, the SMEs that in Germany at least are the backbone of our job market and our thriving economy.

To remain globally competitive, we need the economic dynamism of the European Union. The world around us is not quietly sleeping. The populations and economies of countries like China, India, Brazil, Mexico and South Africa are growing at what is in some cases breathtaking speed. We do not intend by any means to lose sight of the domestic issues these countries must address. We Europeans are part of a community of shared values. Yet we need to recognize that we live in an increasingly competitive world and must learn to cope with it. One way to do this is to create a large European internal market. Unlike these young societies, in Europe in twenty years’ time there will be fewer people than now, they will be older and they will live longer.

It would be shortsighted to view these demographic trends merely as a challenge to our social security systems. When we talk about demographics, of course we think of the tough and courageous decisions needed to safeguard our social security systems, but we ought also to think of the implications for the world at large. How long will it be before these young societies aspire to be world players not just in economic but in political terms as well?

Will we succeed in ensuring that globalized markets translate into globalized values, too? Worldwide respect for human rights, the rule of law, good governance, ethical standards?

Can we remain prosperous or even become more prosperous in a world where we account for an ever smaller proportion of the population?

Can we seize the opportunity presented by emerging markets outside of Europe?

To answer “yes” to all these questions, there are three major challenges that we must tackle together over the years ahead.

First, we must complete Europe’s internal integration.

Second, we must safeguard the long-term stability of the economic and monetary union, and thereby also our prosperity.

Third, we must ensure Europe remains able to act effectively in the wider world.

On the first challenge, completing Europe’s internal integration, we have already made considerable progress. Following the 2004 and 2007 rounds of enlargement, the division of Europe after the Second World War is now past history, as everyone can see. Europe is divided no longer. Europe was never just Western Europe and the European Union cannot be simply a Western European union. By Europe we mean the whole of Europe, the Europe that has been shaped by culture and history, that perceives itself as a community of shared values.

Completing the work of European integration means the accession of Croatia and the accession of other countries in South-East Europe as well.

But there are differences here. Croatia has worked hard for EU membership. From the start Germany has supported its efforts to prepare for membership. And even now Germany is supporting the country in all kinds of ways, from demining to advanced training for judges and public prosecutors.

Let me assure the citizens of Croatia in this distinguished company that you can count on us Germans. In 1991 Hans-Dietrich Genscher, a man of great prescience, was much criticized when he called for recognition of Croatia’s independence. Despite strong opposition, he followed the course he believed right – and history shows he was correct.

In future, just as then, you can rely on Germany to stand by you.

The reforms needed to prepare for EU membership sometimes take years to put in place, but they are worth all the effort. That goes for Croatia as well as all the other accession candidates.

The European Commission monitors the progress of the reforms in every candidate country. The same rules apply to all. Any relaxation of these rules would only fuel concerns about the EU admitting new members. It will not do anyone any good if member states ask too much of their citizens. Europe is strong only if Europe’s citizens feel committed to it. That is why we will not allow any watering down of the criteria for accession.

These criteria are not in any way intended to artificially slow the candidates’ progress towards EU membership. The accession criteria are not impediments to freedom, security and prosperity, they are guarantees.

In its fight against corruption Croatia has made impressive progress. In the area of justice it plans to continue to pursue its reform agenda – which is very important. But the point of these reforms is not to do the EU a favour. The accession candidates have to meet European standards because they owe it to their own citizens. European values mean, for example, that when citizens seek legal remedy, their cases are dealt with promptly and effectively, judges are properly trained and minorities are protected. The rule of law and fair competition are two cornerstones of our prosperity.

I can only warn against importing into the European Union any conflicts countries may have with their neighbours.

In the past disputes over borders were all too often the cause of conflicts in Europe that triggered full-scale wars. In Europe’s future these lines on the map must become lines that bring neighbours and friends closer together.

Croatia and Slovenia have demonstrated how a European approach developed in a spirit of mutual trust can help settle border issues.

The agreement they recently reached here can serve as a model for the whole of South-East Europe. There can be no doubt that one day all countries in the region, also Serbia and Kosovo, will find their place under a common European roof.

As a project for peace, European integration does not belong to yesterday’s world, it is a project that must be taken forward now and in the future.

It was the spirit of reconciliation that made it possible to forge ties of friendship between Germany and Poland, between Germany and France, and it is this spirit of reconciliation that will make Europe strong also in future. Anyone committed to Europe – and this is something I say to everyone – anyone committed to Europe must also be committed to peace and the principle of fair give-and-take. The path to EU membership can only be via cooperation, not confrontation; what the European Union wants is cooperation, not confrontation. For anyone wanting to belong to it, that is a conditio sine qua non.

Ladies and gentlemen,

Reconciliation between former adversaries is just the first step on the road towards a common European future. The further we travel this road, the more we will feel a common bond, a shared European identity.

Ladies and gentlemen,

I turn now to the second major challenge ahead for Europe, safeguarding the stability of the economic and monetary union and hence also the prosperity of all its citizens.

The European Union will only reap the benefits of peace, stability and prosperity if we remain globally competitive. That is why we must do everything possible to ensure we keep up with the rapidly growing economies beyond Europe’s borders. For an EU founding member that is just as important as it is for Croatia as a future member.

Safeguarding our future means debt reduction and rigorous rules on new borrowing.

That is the only way Europe can return to healthy growth. A good European is someone who ensures Europe’s stability. Not just right now or over the year ahead but on a long-term basis.

That is something we owe also indeed to generations to come.

If only in their own best interest, all euro countries should support a healthy euro and do everything possible to ensure the stability of our common currency. And if any euro country should still act irresponsibly, other countries cannot simply turn away and pretend that is none of their business. The stability of the euro is everyone’s business. That is why the German Government believes that when some countries repeatedly and persistently breach their legal obligations, there also have to be sanctions. Shared responsibility is one of Europe’s founding principles and anyone ignoring this must automatically face consequences, which we believe should be in the form of appropriate sanctions.

By the same token, any country not sticking to the rules should receive no more money from the EU’s Structural Funds. The sanctions must be imposed automatically and be applicable to all countries in Europe, no matter how big and powerful. We want a European Union built on responsibility and not transfers, we do not want a Union in which one country can escape the consequences of its actions by hoping and trusting others will save it from its mistakes.

To remain a strong global economic player, Europe must retain its competitive edge in technology and innovation. Even if globalization means workbenches are increasingly located outside Europe, we can and must remain technology pacesetters. Only innovation will create new jobs in Europe.

I want to spell that out very plainly, but I am also very optimistic and confident about the future.

We Europeans sometimes tend to underestimate this European Union of ours. I say this, since you will soon be part of it. In Asia, Africa and Latin America, however, the EU is seen as a success story others want to emulate. That is why countries there are now establishing regional groupings modelled on the European Union. Take Mercosur, the African Union – whose foreign ministers I recently had the privilege to address – or ASEAN. These are just some examples of the way regions, peoples, nations are coming together, very consciously also in response to this new era of globalization. Their starting-points and success prospects may differ of course, yet they are all united by a common purpose. They have realized very clearly that in a globalized world they are stronger if they join forces with others and do not stand alone. That goes for large countries, for medium-sized countries and it also goes for the smaller countries both inside and outside Europe.

The success of the EU is especially evident in times of economic crisis and uncertainty.

The economic and monetary union, the euro and the internal market have prevented protectionism and currency speculation against particular countries from further exacerbating the crisis. Of course EU member states are not alone in this crisis.

The European model of solidarity – where the weak in difficulties are helped by the strong – is clearly a model worth fighting for. But such help can only be subsidiary to their own efforts. The primary responsibility lies with those societies and countries that are in difficulties as well as with their political leaders of course.

Ladies and gentlemen,

From a societal perspective this works the other way, too. The welfare state, I would point out, is part of our successful European model. A crucial part indeed, I believe.

The best way to defend the welfare state, however, is to ensure it has a sound economic basis.

Ladies and gentlemen, when we discuss the issue of Europe’s competitiveness, our main concern must be to ensure we do not fall behind other parts of the world.

Structural change – and I am well aware you know what I am talking about – is never easy, for it always means there are both winners and losers. I know the kind of debates you have on this and you know the kind of debates we in Germany have also been having.

From a long-term perspective the state is robbing its young people of their future if it pumps money into uncompetitive sectors of the economy. These may be industries or agriculture, too, for that matter. The longer one refuses to recognize the inevitability of change, the greater will be the cost of switching to products and technologies that have a real future.

In the end millions will have been wasted on sectors whose day is over, money that cannot be spent on the present and future generations of schoolchildren and students.

In its Lisbon Agenda the EU formulated the goal of creating the most competitive economic region in the world. God knows we are not there yet. So this is not the time to relax our efforts. In fact we must now work harder than ever to create growth and prosperity in Europe. The Europe 2020 Strategy adopted in June maps out how this can be done.

The third challenge Europe faces concerns our ability in the future to act effectively .

In the nineties the nations of Europe proved unable to prevent their continent being revisited by war and destruction. In recent years, however, we have been working to ensure that in future we are better placed to respond to crises and conflicts.

Today Europe is able to act more swiftly and decisively than it did twenty years ago.

The Treaty of Lisbon has enlarged the scope of the Common Security and Defence Policy. It has created a new European External Action Service, which will not replace yet certainly complement national diplomacy.

It is important that Europe’s wealth of experience with its integration and cooperation model should help shape the globalization process.

Shaping globalization needs more Europe, not less.

The Treaty of Lisbon has created the institutional framework for the EU to play a more active role on the world stage. With the negotiations over, this is now the time to look ahead.

Europe’s citizens have little interest, I suspect, in philosophical musings about government. But they are certainly very keen to see effective European policies and also an effective European foreign policy. I think most citizens do not really care what label this European foreign policy bears. Regardless of the label, what they want above all is to see the European institutions solve real-world problems.

Sometimes there seems almost a tendency to forget that these institutions are not ends in themselves. The Union was founded to enable the nations of Europe to achieve together things they could not achieve alone.

As we have known for many years, especially in the field of foreign policy the challenges that can be met only if we work together are clearly increasing, not diminishing.

This is quite obvious when it comes to tackling climate change. Yet it is also clear that, when it comes to developing new rules to ensure the stability of the international financial system, the countries of Europe are unlikely to be heard if everyone is babbling at once. But if they speak with one voice as the EU, they will be heard.

Where countries are able to act on their own, they should be entitled to do so. Not everything has to be decided in Brussels.

Without the EU, however, today we would have no internal market and also much less freedom, less security and less prosperity.

Here in Europe governments have the task of communicating to citizens how the European Union serves them and how much they too can shape Europe’s future – through the European Parliament, through their own national governments as well as through their regions.

Where Europe is concerned, I am a convinced optimist. This union of states and especially this union of citizens can fulfil the aspirations of the European Enlightenment.

In the European Union the individual does not exist to serve the state; the state exists to serve its citizens.

The European Union stands for the rule of law, human dignity and everyone’s right to enjoy individual liberties – and that clearly includes minorities as well. Protecting minorities is something for which all countries in Europe are responsible, both candidate countries and those that are already EU members.

And last but not least, it is the goal of the European Union to ensure that our continent will never again be the scene of barbarity and murder.

This union of peace, freedom and security, this continent where people can live their lives in dignity is worth every ounce of effort. And I look forward with great joy to the day when Croatia becomes a full member of this European Union.