Arcandor bailout debate intensifies
Published on: 30 May 2009 12:32 CET
Arcandor wants a €650 million loan guarantee from the federal government and a €200 million loan from the state bank, KfW. The company says that without the loans, it will have to declare bankruptcy, potentially throwing its 50,000 employees out of a work in the middle of Germany’s worst recession since World War II.
With an eye towards national elections in September, German politicians are scrambling to come up with positions that will appeal to potential voters.
Franz Müntefering, the head of the Social Democrats, called for state aid to Arcandor in an interview the daily Bild on Saturday.
“We must help them. The loan guarantees seem to me to be necessary and forward-looking,” Müntefering was quoted by the newspaper as saying. A bailout was needed, he continued, to secure “thousands of jobs in the important service sector, predominantly amongst women.”
Michael Fuchs, who is chairman of the Christian Democrats’ association of small and medium-sized business association said Arcandor didn’t deserve access to government help.
In an interview to be published Sunday in the daily Rheinpfalz am Sonntag, Fuchs said the financial crisis had nothing to do with company’s problems, which are the result of “years of mismanagement.”
Fuchs said he and all 133 members of his association would vote against any rescue package for Arcandor in the Bundestag. He said the Social Democrats’ proposed bailout was “free beer for all” with taxpayer money.