GERMANY plans to almost double the borrowing it had planned for next year to finance emergency aid for businesses during the second wave of the COVID-19 pandemic, lawmakers said on Friday.
The parliamentary budget committee agreed to a debt figure of almost 180 billion euros ($215 billion) – the second largest amount of net new borrowing in the history of post-war Germany.”The high debt is necessary to bring our country safely through the pandemic,” lawmaker Eckhardt Rehberg, of Chancellor Angela Merkel’s Christian Democrats (CDU), told Reuters. “We must once again make use of the exemption rule from the debt brake.” Enshrined in the constitution, the brake restricts the issuance of new debt by limiting the federal budget deficit to 0.35% of economic output. Parliament suspended it this year in light of the pandemic. Read more…..
The coronavirus pandemic has killed thousands of people, crashed stockmarkets around the world, driven 10m Americans to claim unemployment and caused businesses to haemorrhage money. With economies in turmoil, how bad will the damage be?