With the 2023 budget, Germany apparently exceeds the three percent limit for new debt

Christian Lindner

The Federal Minister of Finance apparently exceeds EU limits with his budget for 2023.

(Photo: dpa)

Berlin Germany is expected to exceed the upper deficit limit that applies to new borrowing in the EU countries in the coming year. According to this, states are only allowed to take on new debt with three percent of the gross domestic product (GDP) in a budget year. As the “Spiegel” reportsbut employees in the Federal Ministry of Finance expect a value of 3.5 percent for 2023.

Because Minister of Finance Christian Lindner (FDP) fall back on the so-called asylum reserve in its budget, the actually planned borrowing increases from 45.6 billion to 86.1 billion, reports the magazine. This reserve actually only consists of virtual amounts, Lindner is actually revising debt repayments from previous years.

This would put Germany above the so-called Maastricht criterion. They were originally introduced to prevent EU countries from taking on excessive new debt. Some of the rules are now considered outdated, and their scientific basis is questionable. The Ministry of Finance could not immediately be reached for comment, reports the Reuters news agency.

>> Read also: Dispute over EU debt rules intensifies – “The Commission needs real instruments of torture”

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For upgrading the armed forces or the energy price brakes, the federal government would take another 200 billion euros in loans. Although these did not count for the debt brake, they did count for the national deficit. The deficit at the federal level is offset by surpluses at the federal states, municipalities and in social insurance.

The debt ratio, i.e. the ratio of old loans to GDP, will therefore rise to over 67 percent in 2023 and remain largely stable in the years that follow. However, the EU has stipulated an upper limit of 60 percent, which is also defined in the EU’s Stability and Growth Pact in the Maastricht criteria. However, due to the corona pandemic and the Ukraine war, this criterion is currently suspended.

More: The federal government is planning more and more billions for investments – but cannot spend them

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