28 November 2020 01:57 am
FRANKFURT AM MAIN (AFP) - Germany, traditionally hostile to government borrowing, will take on 180 billion euros in new debt in 2021 as it grapples with the economic fallout from the coronavirus crisis, according to a draft budget agreed yesterday.
After 17 hours of discussion, the parliamentary finance committee approved a total of 179.8 billion euros (US$ 214.4 billion) of new debt for next year, according to a final document seen by AFP.
The agreement further shatters Germany’s constitutionally enshrined debt brake rule, with public spending now nearly 500 billion euros, as the government continues to support the economy through the
health crisis.
Borrowing in Europe’s largest economy will be nearly 84 billion euros more than the finance ministry forecast in September, before the arrival of a damaging second wave of COVID-19.
Chancellor Angela Merkel announced tough new measures for November that closed restaurants, bars, as well as the tourism, leisure and
cultural industries.