Merkel traveled to Auschwitz on Friday, her first visit to the notorious Nazi concentration camp in her 14 years as leader.
During a ceremony attended by Polish Prime Minister Mateusz Morawiecki, Merkel said,"This site obliges us to keep the memory alive".
"Remembering the crimes, naming the perpetrators, and giving the victims a dignified commemoration, that is a responsibility that does not end", she said.
She marked a minute's silence by the Death Wall where thousands of prisoners were shot dead and visited the site of a gas chamber and a crematorium.
They walked through the camp's iron gate bearing the motto "Arbeit macht frei" (Work sets you free) and visited the barracks.
German Chancellor Angela Merkel prepares to address guests in the so-called Birkenau "Sauna" roomduring her visit at the former German Nazi death camp Auschwitz-Birkenau in Oswiecim, Poland on December 6, 2019. "Because we are experiencing worrying racism, increasing intolerance, a wave of hate crime", she said.
Her Cabinet has already approved a budget for 2020, and Merkel's favoured successor Annegret Kramp-Karrenbauer could earn her stripes by assuming the role of deputy chancellor.
This donation to the Auschwitz Foundation adds to the 60 million euros that Germany donated a decade ago when the fund was launched, according to the Auschwitz-Birkenau State Museum. This also applies to major events, such as the 75th anniversary of the camp's liberation in January 2020.
"These were crimes and violations that transgressed all imaginable boundaries", Merkel said on Friday on the occasion of the 10th anniversary of the creation of the Auschwitz-Birkenau Foundation, accompanied by Polish Prime Minister Mateusz Morawiecki, Xinhua news agency reported.
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More than 3 million of Poland's 3.2 million Jews were killed by the Nazis, accounting for about half of the Jews killed in the Holocaust.
Many were killed the same day they arrived at the camp. "We are focusing our attention especially on anti-Semitism, which poses a threat to Jewish life in Germany, Europe and beyond".
German chancellors have made the trip to Auschwitz before - Helmut Schmidt visited in 1977 and Helmut Kohl in 1989 and 1995.
Her visit comes two months after an attack aimed at a synagogue in the eastern city of Halle in which two people were killed - part of a growing trend.
In 2008, she became the first German leader to address the Israeli parliament.
She then moved to the Birkenau site where she gave her speech.
Police figures show that anti-Semitic offences rose by nearly 10 percent in Germany last year from the previous year to 1,646 - the highest level in a decade.
"It's always a question of where you go when you want to do this kind of symbolic remembrance and Angela Merkel went several times (to) Yad Vashem to do this, that is probably one of the reasons, I think, why she hasn't been to Auschwitz yet", said Magnus Brechtken, the deputy director of the Leibniz Institute for Contemporary History.
There may also be a particular sense of responsibility for Merkel, who critics even in her own party argue, contributed to the resurgence of right-wing extremism by allowing more than a million refugees into the country.