By Zhang Bihong

    BERLIN, Nov. 30 (Xinhuanet) -- German Chancellor Angela Merkel made her first speech Wednesday to German parliament, the Bundestag, on her government's major policies.

    Areas she covered included anti-terror, Germany's role in the European Union, Iran's nuclear program and Turkey's EU membership, as well as economic foes facing her country.

    Merkel said German economic growth had been sluggish for years, debts had risen to "terrifying heights" and progress in the formerly communist east had come to a halt.

    She vowed that her grand coalition government, formed by her Christian Democrats and the former chancellor Gerhard Schroeder's Social Democrats, would put the country's federal system in order.

    "We want to cut our debts and to restructure our health, pensions and care system," she said, promising to lift Germany among the "top three" in Europe within 10 years." Nobody can stop us but ourselves," she said.

    She urged Germans to have the courage to allow greater freedom to ensure faster economic growth.

    She also pledging to improve education and hi-tech research.

    Merkel painted a bright hi-tech future for her country on the basis of improved education and more investment in research and development.

    The first female chancellor in German history praised highly Schroeder for his reform policies, saying that he had "opened the door to restructuring our social systems for the new era".

    She promised to help the entrepreneurial middle class through reform business taxes to make the motor of Germany's export sector more competitive.

    On anti terror, she said Germany would not be intimidated and not open to blackmail by terrorists, referring to the abduction of a German woman recently in Iraq by terrorists.

    The kidnappers have demanded the German government stop cooperating with the Iraqi government or the woman and her Iraqi driver would be killed.

    "We cannot relent in the fight against international terrorism." said Merkel, who issued a statement Tuesday strongly condemning the kidnapping.

    On Germany's role in the EU, she noted that "a special task for Germany is to act as go-between and balancing factor" within the bloc in relations with smaller member nations.

    She said the EU is in "deep crisis", listing severe setbacks to the constitution and serious conflicts of interests between member nations over 2007-2013 budget as main problems facing the EU.

    The EU constitution was rejected by France and the Netherlands in referenda in the middle of this year.

    "There are no point in brushing away this crisis. We need to master it," she said.

    Merkel vowed to use her trip to Poland later this week to boost ties with Germany's eastern neighbor.

    She pledged to work for compromise at the EU December summit, which will focus on a budget proposal put forward by EU current rotating president Britain, but Merkel also stressed that her country would not take on additional financial burdens that it could not afford.

    On EU expansion, she called for broad public support, saying "the ability of the European Union to take on new members must not be over-extended".

    Merkel, who opposes full EU membership for Turkey, proposing "privileged partnership", said talks on the matter would be conducted in an open manner.

    On Iran's nuclear program, Merkel said the German government would continue efforts to persuade Iran to cooperate with the United Nations on its nuclear program.

    Merkel warned Iran not to back away from cooperation with the International Atomatic Energy Agency, UN nuclear supervisory body.

    "Despite recent setbacks, the German government will continue to engage in the three-plus-one process. This process must carry on," Merkel said, referring to talks between Germany, Britain and France over Iran's nuclear program.

    Responding to a recent remark by Iranian President Mahmoud Ahmadinejad last month that Israel should be "wiped off the map", Merkel said this was "absolutely unacceptable in every respect".

    "Germany has a very special responsibility with regard to Israel... On behalf of the new government, I would like to use this opportunity to stress Israel's right to exist and the right of its citizens to live free from terror, fear and violence.

    She also reaffirmed the right of "the Palestinian people to their own state, which exists alongside Israel in security and within acknowledged borders". Enditem