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Germany eyes $190 billion in debt in 2021 to set off Covid impact: Sources

German Finance Minister Olaf Scholz plans to take on at least $190 billion in new debt in 2021 to help stave off the economic impact of the coronavirus pandemic

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Germany | Coronavirus | Coronavirus Vaccine

Reuters  |  BERLIN 

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People wearing face masks to help curb the spread of the coronavirus ride bicycle

By Holger Hansen

BERLIN (Reuters) - German Finance Minister Olaf Scholz plans to take on at least 160 billion euros ($190 billion) in new debt in 2021 to help stave off the economic impact of the pandemic, three people familiar with the matter said on Sunday.

This is at least 64 billion euros higher than the 96 billion euros initially eyed by Scholz for next year.

Parliament has suspended Germany's debt brake to allow the government to take on net new debt of up to 218 billion euros to finance rescue and stimulus measures.

But a coalition source said it was unlikely to need the full amount. Scholz has said he will ask lawmakers to suspend debt limits again next year.

The Finance Ministry was not immediately available for comment.

has taken unprecedented steps to help companies and small businesses get through the crisis, freeing up billions of euros to prevent the economy shrinking further.

The government expects gross domestic product to contract by 5.5% in 2020, but to rebound by 4.4% in 2021.

($1 = 0.8437 euros)

 

(Writing by Christoph Steitz; Editing by Kevin Liffey)

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

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First Published: Sun, November 22 2020. 19:43 IST
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