• Germany's news in English

Germany agrees to 'historic' balanced budget

The Local · 13 Mar 2013, 16:43

Published: 13 Mar 2013 16:43 GMT+01:00

Facebook Twitter Google+ reddit

The structural federal budget – excluding one-off items and the effects of the economic cycle – would be balanced in 2014, the Finance Ministry said.

The budget nevertheless foresees a deficit of €6.4 billion ($8.3 billion) in the total federal budget of 296.9 billion euros next year, mainly owing to German payments into the European bailout fund.

"At €6.4 billion, new borrowing is at its lowest level for 40 years," the Finance Ministry said in a statement.

In 2015, 2016 and 2017, the books would be balanced entirely, according to the draft budget, with no new borrowing required by Europe's top economy.

"Growth and (budgetary) consolidation are not mutually exclusive but rather they reinforce each other," Finance Minister Wolfgang Schäuble emphasised.

"The confidence that solid state finances brings is the pre-condition for sustainable growth," he added.

Germany had drawn "the right lessons from the European debt crisis" and is fulfilling its role as "a stability anchor in Europe," added the minister.

Co-presenting the budget, Economy Minister Philipp Rösler said: "In all humility, I think this is a historic step."

The federal budget deficit amounted to more than €44 billion in 2010, when Germany was recovering from one of its worst recessions since World War II.

By 2012 the deficit had been slashed to €22.5 billion however, and it is expected to be €17.1 billion in 2013.

The budget comprises just spending at a federal level. The wider public deficit, which includes regional and local administrations, is used to calculate whether countries are abiding by European rules.

Story continues below…

In 2012, Germany registered a surplus of 0.1 percent of total gross domestic product (GDP) on this measure, according to a provisional figure published in mid-January.

European Union rules state countries in the eurozone may not run a public deficit higher than three percent of GDP, and are supposed to work towards a balance, and even a surplus in times of economic growth.


The Local (news@thelocal.de)

Facebook Twitter Google+ reddit

Your comments about this article

19:20 March 13, 2013 by lucksi
We are this close to not taking on new debt.

Quick, elections are coming up, give us some new tax breaks to get more voters so that we won't reach that horrible scenario.

Just joking, the SPD and the Greens will win and drive this country into the wall again just as all the times before. Then -4 or 8 years later- the CDU will win again, try to balance the budget and having to raise taxes (as they always do), get deeply unpopular due to this and the cycle begins anew.

Meanwhile -because I failed math- I will continue to play the lottery in hopes of quitting this rat race...
06:00 March 14, 2013 by Wrench
Ditto! lucksi, only I don't play the lotto
Today's headlines
Long-vanished German car brand joins electric race
Photo: DPA

Cars bearing the stamp of once-defunct manufacturer Borgward will once again roll off an assembly line in north Germany from 2018, the firm said Wednesday.

Eurowings cabin crew union to strike all day Thursday
Photo: DPA.

UPDATE: A union representing cabin crews on Lufthansa's budget airline Eurowings has announced that strikes will last all day Thursday as ongoing contract negotiations continue to falter.

Hesse hopes to set example by building Iraqi orphanages
Refugee children in northern Iraq. Photo: DPA

The wealthy central German state of Hesse has set aside €1 million to build a school, family homes and an orphanage in northern Iraq, in an effort to help refugees there.

The Local List
10 German clichés that foreigners get very wrong
David Hasselhoff. Photo: DPA

Whether it be efficiency, humourlessness or a love of a certain Baywatch star, there are many cliches stuck in the heads of foreigners about Germany. But how true are they?

Fake Germanwings victim relative convicted in Cologne
A torn piece of metal at the crash site in 2015. Photo: DPA

A German court on Wednesday gave a woman a year's suspended jail sentence for posing as the cousin of a victim in last year's Germanwings plane crash and obtaining compensation offered by the airline.

Couple accused of torturing, murdering women go on trial
The so-called 'house of horrors' in Höxter where the couple allegedly tortured and killed women. Photo: DPA.

A couple accused of luring women to their village home with personal ads started trial on Wednesday over charges that they tortured and killed at least two of their victims.

After July attacks, govt drafts new video surveillance law
Photo: DPA

The Interior Ministry is drafting a law which will enable public spaces to be filmed for surveillance purposes as a reaction to deadly attacks in July, according to a newspaper report.

Merkel: murky internet giants distort perception of reality
Angela Merkel. Photo: DPA.

Chancellor Angela Merkel called on Tuesday for internet giants to make public their closely-guarded algorithms, claiming that they are not giving people diverse enough information.

Pegida leader 'paid court costs with group's money'
Pegida leader Lutz Bachmann. Photo: DPA.

The leader of the anti-Islam movement reportedly used money from Pegida's coffers to pay for two personal court cases, German media reported this week.

Anger as Berlin scraps Turkey concert on Armenia genocide
The Dresden Symphony Orchestra. Photo: DPA

Germany's foreign ministry Tuesday scrapped a planned symphony performance on the Armenian "genocide" in its Istanbul consulate, sparking accusations that it was caving in to Turkish pressure.

10 ways German completely messes up your English
Sponsored Article
Last chance to vote absentee in the US elections
Germany's 10 most weird and wonderful landmarks
10 things you never knew about socialist East Germany
How Germans fell in love with America's favourite squash
How I ditched London for Berlin and became a published author
12 clever German idioms that'll make you sound like a pro
23 fascinating facts you never knew about Berlin
9 unmissable events to check out in Germany this October
10 things you never knew about German reunification
10 things you're sure to notice after an Oktoberfest visit
Germany's 10 most Instagram-able places
15 pics that prove Germany is absolutely enchanting in autumn
10 German films you have to watch before you die
6 things about Munich that’ll stay with you forever
10 pieces of German slang you'll never learn in class
Ouch! Naked swimmer hospitalized after angler hooks his penis
Six reasons why Berlin is now known as 'the failed city'
15 tell-tale signs you’ll never quite master German
7 American habits that make Germans very, very uncomfortable
Story of a fugitive cow who outwitted police for weeks before capture
Eleven famous Germans with surnames that'll make your sides split
jobs available
Toytown Germany
Germany's English-speaking crowd