"Whoever disrupts global supply chains, or even breaks them, will eventually harm all those involved", Merkel said.
"For many people, including myself, something changed when we saw the Britons want to leave, when we were anxious about the outcome of the elections in France and the Netherlands", Merkel told voters, some of whom wore straw hats with black-red-and-gold hatbands, the colors of the German flag.
Angela Merkel has been blamed for having made the choice of a town centre for such a meeting, while this kind of summits are most often far away from cities to avoid protests.
Merkel distanced herself from local politicians within her party who had called for Hamburg's Mayor Olaf Scholz, a senior SPD member, to step down because of the riots.
Merkel said the riots were absolutely unacceptable but it was still right to have invited G20 leaders to Hamburg.
Such an investment push would cost "a lot of money", Schulz said but it would be better to spend the country's budget surplus that way than wasting it by promising voters tax cuts-a clear dig at Merkel's conservatives. She pointed to planning and capacity bottlenecks in the construction industry as well as at the level of regional authorities.
Merkel says must tackle bottlenecks before boosting investment
Germany has already earmarked billions of euros for schools, nurseries, hospitals and housing, but local authorities have so far spent only a fraction of that windfall due to planning bottlenecks. "For this, I have the same responsibility as Olaf Scholz does - and I'm not dodging", she added.
"In addition to the debt ceiling, we need a minimum speed for investments that preserve the fabric of our country", he said, according to Handelsblatt. "It can also be more", she said. He had signaled in an interview that Germany must help resolve the imbalance by promoting domestic demand through increased spending.
Merkel underlined her determination to run for a full four-year term in the September 24 election.
"The long-sought limit of 200,000 refugees per year for Germany is necessary to ensure functional integration", the election manifesto says.
Right now it looks as if Merkel will remain chancellor after the election, but Martin Schulz should look to Britain if he wants to take the top spot. "But Germany can do more".More news: Everything we need to know about the E-Pace