"Today, you can trust that I will do everything to strengthen the euro," Merkel said. "This will only succeed if Europe learns from the mistakes of the past. One of these is that a common currency can only be successful if we co-operate more than in the past in Europe."
President Nicolas Sarkozy, who faces a re-election battle this year and has been trailing in polls, said there had to be structural changes to the French economy. He said the new year is "full of risks" and that France's future hangs in the balance.
"What is happening in the world announces that 2012 will be a year full of risks but also full of possibilities. Full of hope, if we know how to face the challenges. Full of dangers, if we stand still," Sarkozy said during the last New Year's Eve address of his first term.
"Emerging from the crisis, building a new model for growth, giving birth to a new Europe – these are some of the challenges that await us," he said.
In Italy, Giorgio Napolitano used his New Year's speech to warn Italians they will have to make sacrifices to avoid financial collapse.
"Nobody, today — no social group — can stall on the commitment to contribute to the revival of public accounts to avoid the financial collapse of Italy," Napolitano said in his televised speech late yesterday. "The sacrifices won't be useless. Only united can we progress and count as Europeans in a radically changed world."
Italy must fight corruption and tax evasion, Napolitano said, adding his country had no future without regeneration of the political system.
"We all need to understand that for a long time the State, grew too much and spent too much, ending up imposing heavy taxes on honest contributors and placing a serious mortgage on the shoulders of future generations," the Italian President said.
Greek Prime Minister Lucas Papademos said in an emailed statement that his country faces a "difficult" year and must continue its efforts to remain in the euro and avoid economic collapse.
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