AIRLINK 63.43 Increased By ▲ 0.23 (0.36%)
BOP 5.46 Increased By ▲ 0.06 (1.11%)
CNERGY 4.68 Increased By ▲ 0.11 (2.41%)
DFML 19.02 Decreased By ▼ -0.71 (-3.6%)
DGKC 70.29 Increased By ▲ 1.29 (1.87%)
FCCL 19.12 Increased By ▲ 0.87 (4.77%)
FFBL 30.86 Increased By ▲ 1.47 (5%)
FFL 9.58 Increased By ▲ 0.27 (2.9%)
GGL 10.16 No Change ▼ 0.00 (0%)
HBL 109.20 Decreased By ▼ -0.86 (-0.78%)
HUBC 127.70 Increased By ▲ 1.69 (1.34%)
HUMNL 6.85 Increased By ▲ 0.12 (1.78%)
KEL 4.39 Decreased By ▼ -0.08 (-1.79%)
KOSM 4.43 Decreased By ▼ -0.02 (-0.45%)
MLCF 37.39 Increased By ▲ 0.79 (2.16%)
OGDC 128.50 Increased By ▲ 0.20 (0.16%)
PAEL 22.80 Decreased By ▼ -0.39 (-1.68%)
PIAA 26.50 Increased By ▲ 0.30 (1.15%)
PIBTL 6.19 Increased By ▲ 0.19 (3.17%)
PPL 112.52 Decreased By ▼ -0.28 (-0.25%)
PRL 26.85 Decreased By ▼ -0.30 (-1.1%)
PTC 16.75 Decreased By ▼ -0.34 (-1.99%)
SEARL 60.72 Decreased By ▼ -1.37 (-2.21%)
SNGP 65.35 Increased By ▲ 1.40 (2.19%)
SSGC 11.05 Increased By ▲ 0.02 (0.18%)
TELE 9.10 Decreased By ▼ -0.13 (-1.41%)
TPLP 11.28 Increased By ▲ 0.28 (2.55%)
TRG 69.85 Decreased By ▼ -1.10 (-1.55%)
UNITY 23.65 Decreased By ▼ -0.30 (-1.25%)
WTL 1.31 Decreased By ▼ -0.07 (-5.07%)
BR100 7,280 Increased By 64.2 (0.89%)
BR30 23,637 Increased By 105.1 (0.45%)
KSE100 70,315 Increased By 694.7 (1%)
KSE30 23,132 Increased By 221.5 (0.97%)

BERLIN: Germany took on record new debt in 2020 to shield the economy from the coronavirus pandemic, but less than expected, official data showed Tuesday.

“Despite the pandemic, we have the finances well under control,” Finance Minister Olaf Scholz told reporters.

Europe’s largest economy took on 130.5 billion euros ($158.3 billion) in new borrowing last year.

The amount is the highest since German reunification in 1990, but still less than the 218 billion euros in new debt authorised by parliament to deal with the health crisis.

In part this can be explained by a weaker than expected economic slump, thanks to a strong rebound during the summer, the finance ministry said.

Germany’s economy contracted 5.0 percent in 2020, 0.5 percentage points above the government’s estimates, and a smaller decline than during the 2009 financial crisis when output shrank by 5.7 percent. Some public investments, including in Germany’s state-owned rail company Deutsche Bahn, were also postponed to 2021. Further keeping the lid on 2020’s debt figure were delayed payments to businesses hit by Covid-19 shutdowns. Technical problems and red tape meant that many companies only saw payments arriving at the beginning of this year.

Scholz has promised to “simplify and extend” the aid.

Famously frugal Germany abandoned its cherished “debt brake” last year to cope with the pandemic fallout.

The constitutionally-enshrined rule forbids the government from taking on new debt of more than 0.35 percent of gross domestic product (GDP) in any one year in normal times.

Chancellor Angela Merkel’s government has pledged nearly one trillion euros in aid and stimulus to help German companies and employees, including through massive short-time work schemes.

In total, Berlin plans for 300 billion euros of new debt between 2020 and 2021.

Germany’s debt-to-GDP ratio climbed to 70 percent in 2020, Germany’s central bank said in December, breaching a European Union maximum of 60 percent.

Comments

Comments are closed.