FRANKFURT – Germany, traditionally hostile to government borrowing, will take on €180 billion (RM873.05 billion) in new debt in 2021 as it grapples with the economic fallout from the coronavirus crisis, according to a draft budget agreed today.
After 17 hours of talks, the parliamentary finance committee approved a total of €179.8 billion euros (RM872.08 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 (RM2.43 trillion), as the government continues to support the economy through the health crisis.
Borrowing in Europe's largest economy will be nearly €84 billion (RM407.42 billion) 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.
Earlier this week, Merkel announced the extension of these measures through January unless Covid-19 case numbers come down dramatically.
However, Germany today also passed the milestone of one million cases since the start of the pandemic. – AFP, November 27, 2020
