BERLIN (Reuters) – Germany requires both architectural reforms and even more financial investment in public facilities to conquer economic downturn, the European head of the International Monetary Fund claimed in a meeting with Sueddeutsche Zeitung.
“Without a functioning infrastructure, there can be no productive economy,” Alred Kammer informed the paper in a meeting released on Tuesday.
In order to set in motion even more cash, it would certainly additionally make good sense to change the existing credit score policies, Kammer claimed. “We at the IMF already calculated this some time ago: The debt brake can be relaxed – and the government debt ratio will still continue to fall.”
Finance Minister Christian Lindner has actually demanded sticking to Germany’s financial debt brake, which limits the deficit spending to 0.35% of gdp, in spite of a projection 2nd year of economic downturn and a slow development overview.
Economy Minister Robert Habeck, on the various other hand, lately recommended a multibillion-euro fund to boost financial investment and treatment development.
Asked whether Lindner or Habeck was best in the German federal government’s essential disagreement, Kammer reacted that “a lot would be gained if politicians clearly communicated what their strategy is in the medium and long term”.
This was specifically real for the climate-friendly restructuring of the nation. “Companies will only invest if they know what is going to happen in the next ten to 15 years,” Kammer claimed.
(Reporting by Kirsti Knolle, Editing by Rachel More)
