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German debt set to balloon

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German debt set to balloon
Finance Minister Peer Steinbrück. Not happy. Photo: DPA
16:37 CEST+02:00
Germany could have to take on another €312 billion in debt by 2013, according to finance ministry documents cited on the website of the magazine Der Spiegel.

For 2010, the ministry's medium-term financing plan has pencilled in €86 billion in new debt, a record compared with the €50 billion forseen for this year.

The debt figures will be presented to the cabinet by Finance Minister Peer Steinbrück as part of the planning process for the 2010 budget, the magazine said.

Another €72 billion would be added in 2011, €59 billion in 2012 and €45 billion in 2013 to reach the total, according to the documents consulted by Spiegel.

In 2008, the government took on €11.5 billion in new debt to balance its budget as it sought to pull the economy out of the worst recession since 1945.

Government spending next year is expected to reach a record €328 billion owing to economic stimulus packages needed to fight the global economic crisis, the magazine said.

The labour ministry's budget, which covers unemployment payments, is set to become the biggest spending item again at €153 billion.

Receipts of €28 billion per year are expected as a result of privatisations but according to the report, the government no longer has enough holdings to generate such a sum.

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