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ECONOMY

Germany unveils relief package for companies amid Ukraine crisis

The German government unveiled a multi-billion euro support package Friday to help companies in Europe's biggest economy weather the fallout from the Ukraine war and sanctions against Russia.

Finance Minister Christian Lindner
German Finance Minister Christian Lindner (FDP) unveils support package for struggling businesses in Berlin on April 8th, 2022. Photo: picture alliance/dpa | Fabian Sommer

Finance Minister Christian Lindner described the measures as a “shock absorber” to cushion the blow from soaring energy costs and disrupted supply chains.

The package includes €100 billion ($110 billion) in state-guaranteed loans and seven billion euros in cheap loans by public lender KfW, the finance and economy ministries said in a joint statement.

It also includes direct financial aid for some companies when their energy costs have more than doubled, and for companies deemed systematically relevant such as those supplying gas and electricity.

The measures are likely to help energy-hungry sectors like Germany’s steel, manufacturing and chemical industries.

Although Germany is traditionally a fiscally frugal nation, the government broke its own debt rules at the start of the coronavirus pandemic and unleashed vast financial aid to steer the economy through the crisis.

The relief package to counter the Ukraine war impact is much smaller by comparison.

READ ALSO: German Bundesrat votes on heating subsidy for low-income households

It comes after Berlin already announced separate measures to help German citizens facing soaring household bills at a time of record-high inflation.

That package included heating subsidies and extra child benefits for low-income families, as well as a tax fuel cut and a pledge to slash public transport costs for three months.

But Economy Minister Robert Habeck warned that the government could not fully shield citizens and firms from the Ukraine war repercussions.

“We must all in these times carry a part of the burden, and the question is how big this part will be and how we can achieve it in a just way,” said Habeck.

Lindner, from the liberal FDP party, said the government could not deplete itself financially and had to “act responsibly with taxpayer money”.

The government, which already announced €99.7 billion in new debt for 2022 in part to fund a massive shift towards renewable energy, will unveil an additional budget shortly that will take into account new borrowing plans since the war in Ukraine.

Chancellor Olaf Scholz has also announced a special fund of €100 billion to modernise the German military.

Despite all the spending, Lindner has said he aims to reinstate Germany’s cherished “debt brake” in 2023, which places a cap on new borrowing.

READ ALSO: Cheap transport and tax cuts: What Germany’s energy relief package means for you

Member comments

  1. But Economy Minister Robert Habeck warned that the government could not fully shield citizens and firms from the Ukraine war repercussions.

    But Economy Minister Robert Habeck warned that the government could not fully shield firms profit and share prices from the Ukraine war repercussions.

    I corrected it for you local.

    A 3 month slight tax break for citizens is a slap in the face. The borrowing of the last 3 years is just out of control. And borrowing this money does only one thing. Raise inflation if there’s more money out in supply. Its worth less. Its only going to get worse too. This debt is going to have to be paid back at some point. Which means higher taxes and more poverty.

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UKRAINE

Rapping, breakdancing Ukrainians win Eurovision in musical morale boost

Ukraine won the Eurovision Song Contest Sunday with an infectious hip-hop folk melody, boosting spirits in the embattled nation fighting off a Russian invasion that has killed thousands and displaced millions of people.

Rapping, breakdancing Ukrainians win Eurovision in musical morale boost

Riding a huge wave of public support, Kalush Orchestra beat 24 competitors in the finale of the world’s biggest live music event with “Stefania”, a rap lullaby combining Ukrainian folk and modern hip-hop rhythms.

“Please help Ukraine and Mariupol! Help Azovstal right now,” implored frontman Oleh Psiuk in English from the stage after their performance was met by a cheering audience.

In the Ukrainian capital Kyiv, the triumph was met with smiles and visible relief.

“It’s a small ray of happiness. It’s very important now for us,” said Iryna Vorobey, a 35-year-old businesswoman, adding that the support from Europe was “incredible”.

Following the win, Psiuk — whose bubblegum-pink bucket hat has made him instantly recognisable — thanked everyone who voted for his country in the contest, which is watched by millions of viewers.

“The victory is very important for Ukraine, especially this year. Thank you from the bottom of our hearts. Glory to Ukraine,” Psiuk told journalists.

Music conquers Europe

The win provided a much-needed morale boost for the embattled nation in its third month of battling much-larger Russian forces.

Mahmood & BLANCO  performing for Italy at Eurovision 2022

Mahmood & BLANCO perform on behalf of Italy during the final of the Eurovision Song contest 2022 in Turin, Italy. (Photo by Marco BERTORELLO / AFP)

“Our courage impresses the world, our music conquers Europe!” he wrote on Facebook.

“This win is so very good for our mood,” Andriy Nemkovych, a 28 year-old project manager, told AFP in Kyiv.

The victory drew praise in unlikely corners, as the deputy chief of the NATO military alliance said it showed just how much public support ex-Soviet Ukraine has in fighting off Moscow.

“I would like to congratulate Ukraine for winning the Eurovision contest,” Mircea Geoana said as he arrived in Berlin for talks that will tackle the alliance’s expansion in the wake of the Kremlin’s war.

“And this is not something I’m making in a light way because we have seen yesterday the immense public support all over Europe and Australia for the bravery of” Ukraine, Geoana said.

British Prime Minister Boris Johnson called the win “a clear reflection of not just your talent, but of the unwavering support for your fight for freedom”.

And European Council President Charles Michel said he hoped next year’s contest “can be hosted in Kyiv in a free and united Ukraine”.

‘Ready to fight’
Despite the joyous theatrics that are a hallmark of the song contest, the war in Ukraine hung heavily over the festivities this year.
 
The European Broadcasting Union, which organises the event, banned Russia on February 25, the day after Moscow invaded its neighbour.
 
“Stefania”, written by Psiuk as a tribute to his mother before the war, mixes traditional Ukrainian folk music played on flute-like instruments with an invigorating hip-hop beat. The band donned richly embroidered ethnic garb
to perform their act.
 
 
Nostalgic lyrics such as “I’ll always find my way home even if all the roads are destroyed” resonated all the more as millions of Ukrainians have been displaced by war.

Kalush Orchestra received special authorisation from Ukraine’s government to attend Eurovision, since men of fighting age are prohibited from leaving the country, but that permit expires in two days.

Psiuk said he was not sure what awaited the band as war rages back home.

“Like every Ukrainian, we are ready to fight as much as we can and go until the end.

Britain’s ‘Space Man’

Ukraine beat a host of over-the-top acts at the kitschy, quirky annual musical event, including Norway’s Subwoolfer, who sang about bananas while dressed in yellow wolf masks, and Serbia’s Konstrakta, who questioned national healthcare while meticulously scrubbing her hands onstage.

Coming in second place was Britain with Sam Ryder’s “Space Man” and its stratospheric notes, followed by Spain with the reggaeton “SloMo” from Chanel.

After a quarter-century of being shut out from the top spot, Britain had hoped to have a winner in “Space Man” and its high notes belted by the affable, long-haired Ryder.

Britain had been ahead after votes were counted from the national juries, but a jaw-dropping 439 points awarded to Ukraine from the public pushed it to the top spot.

Eurovision’s winner is chosen by a cast of music industry professionals — and members of the public — from each country, with votes for one’s home nation not allowed.

Eurovision is a hit among fans not only for the music, but for the looks on display and this year was no exception. Lithuania’s Monika Liu generated as much social media buzz for her bowl cut hairdo as her sensual and elegant
“Sentimentai”.

Other offerings included Greece’s “Die Together” by Amanda Georgiadi Tenfjord and “Brividi” (Shivers), a duet from Italy’s Mahmood and Blanco.

Italy had hoped the gay-themed love song would bring it a second consecutive Eurovision win after last year’s “Zitti e Buoni” (Shut up and Behave) from high-octane glam rockers Maneskin.

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