Merkel appeals for urgent fiscal reform in Europe

German Chancellor Angela Merkel on Thursday called for urgent fiscal reform in Europe at the on-going annual meeting of the World Economic Forum.

During a special speech delivered Thursday afternoon, Merkel said that Europe is continuously being confronted by great challenges.

"We often talk about the sovereign debt crisis, (and) about the crisis in the euro area, we have this somewhat under control now, but we are not out of it yet. We have not overcome it," she said.

"We need a growth-oriented, sound fiscal policy, we need investments, we need investments by the state, and first and foremost, need an environment which encourages private investors to take investments," Merkel said.

The German leader made her speech prior to the announcement of the European Central Bank's (ECB) Thursday decision to start quantitative easing by purchasing public and private securities in a bid to address prolonged low inflation.

Merkel highlighted that whatever the decision of the ECB on quantitative easing, European leaders must not be diverted from continuing with meaningful structural reforms.

"Time is of the essence," she said, adding that "every day we delay is a lost day. We need to promote growth and create long-term jobs."

Having acknowledged the progress in reform efforts by countries including Italy, Spain and France, the chancellor noted that Europe has an opportunity to emerge stronger out of the crisis.

"The European single market needs to become less regulated and more open," said Merkel. Enditem