Budapest Post

Cum Deo pro Patria et Libertate
Budapest, Europe and world news

Olaf Scholz still says ‘nein’ after his party hints at new EU debt

Olaf Scholz still says ‘nein’ after his party hints at new EU debt

German Social Democrats are open to examining new joint EU financing instruments, but the chancellor is reluctant.
Although Olaf Scholz's own Social Democrats may be opening the door to more common EU funding, the German chancellor is still giving the idea the cold shoulder.

A new paper from the Social Democratic Party's parliamentary group, adopted at a party leadership meeting on Thursday, urges the European Union to loosen its state aid rules in response to a recent U.S. subsidy push. Notably, the memo also cautiously raises a controversial idea: New joint EU debt to buoy local industry.

"Additional joint financing instruments must also be constructively examined,” the position paper reads.

Yet when asked by POLITICO whether Scholz backs any new debt proposals, a government spokesperson issued a swift denial, pointing to remarks the chancellor made last fall praising the EU's already existing funds, designed to help companies bounce back from the coronavirus crisis and ditch Russian energy.

He called those two funds "exactly the signal you need in this situation," suggesting that no further financing instruments are needed.

"Beyond that, there is no new position," the government spokesperson said.

While Scholz may not be budging, he's still under mounting pressure on the subject. Other countries like Italy, France and Spain have long been urging Berlin to allow more joint EU debt as a way to balance out economic and financial inequalities across the bloc.

Germany has faced particular scrutiny because, as the bloc's largest economic power, it has been able to dole out large financial support measures for its industries and citizens, such as a €200 billion relief package amid the current energy crisis. Germany has also requested nearly half of the around €540 billion in state aid money the EU approved last year.

Many EU countries including Spain argue that without new joint financing mechanisms, the EU's single market will become increasingly distorted because rich countries like Germany can afford subsidies for their industries, for example when it comes to boosting future green industry, whereas others cannot. Such criticism asserts that existing EU funds are not sufficient to address that imbalance.

However, Scholz's room for maneuver on new EU debt issuance is limited by the current German government coalition, in which the fiscally restrictive Free Democratic Party under Christian Lindner holds the Finance Ministry.

Lindner's ministry declined to give a response to the Social Democratic Party paper, saying: "We, as the Federal Ministry of Finance, do not comment on papers from the political arena as a matter of principle."
AI Disclaimer: An advanced artificial intelligence (AI) system generated the content of this page on its own. This innovative technology conducts extensive research from a variety of reliable sources, performs rigorous fact-checking and verification, cleans up and balances biased or manipulated content, and presents a minimal factual summary that is just enough yet essential for you to function as an informed and educated citizen. Please keep in mind, however, that this system is an evolving technology, and as a result, the article may contain accidental inaccuracies or errors. We urge you to help us improve our site by reporting any inaccuracies you find using the "Contact Us" link at the bottom of this page. Your helpful feedback helps us improve our system and deliver more precise content. When you find an article of interest here, please look for the full and extensive coverage of this topic in traditional news sources, as they are written by professional journalists that we try to support, not replace. We appreciate your understanding and assistance.
Newsletter

Related Articles

0:00
0:00
Close
Bruce Willis Relocated Due to Advanced Dementia
French and Korean Nuclear Majors Clash As EU Launches Foreign Subsidy Probe
EU Stands Firm on Digital Rules as Trump Warns of Retaliation
Getting Ready for the 3rd Time in Its History, Germany Approves Voluntary Military Service for Teenagers
Denmark Confronts U.S. Diplomat Over Covert Trump-Linked Influence in Greenland
Trump Demands RICO Charges Against George Soros and Son for Funding Violent Protests
Taylor Swift Announces Engagement to NFL Star Travis Kelce
France May Need IMF Bailout, Warns Finance Minister
After the Shock of Defeat, Iranians Yearn for Change
Ukraine Finally Allows Young Men Aged Eighteen to Twenty-Two to Leave the Country
The Porn Remains, Privacy Disappears: How Britain Broke the Internet in Ten Days
YouTube Altered Content by Artificial Intelligence – Without Permission
Ukrainian Refugee Iryna Zarutska Fled War To US, Stabbed To Death
Elon Musk Sues Apple and OpenAI Over Alleged App Store Monopoly
German Chancellor Friedrich Merz: “The Current Welfare State Can No Longer Be Financed”
HSBC Switzerland Ends Relationships with Over 1,000 Clients from Saudi Arabia, Lebanon, Qatar, and Egypt
Sharia Law Made Legally Binding in Austria Despite Warnings Over 'Incompatible' Values
Dutch Foreign Minister Resigns Amid Deadlock Over Israel Sanctions
Trump and Allies Send Messages of Support to Ukraine on Independence Day Amid Ongoing Conflict
China Reels as Telegram Chat Group Shares Hidden-Camera Footage of Women and Children
MotoGP Cameraman Narrowly Avoids Pedro Acosta Crash at Hungarian Grand Prix
Wizz Air passengers screamed as storm-battered flight diverts to Bologna
European postal services halt U.S. deliveries after Trump imposes new tariffs
Urban explorer finds abandoned luxury restaurant left to decay
Fidesz leader labels Péter Magyar a ‘bluffer’ amid escalating political spat
French rope park operator arrested for denying entry to Israeli children
Újpest thrashes Zalaegerszeg 4-1 to secure first win in five matches
Profit-margin cap costs retailers 13 billion forints a month, warns trade group
Curiosity rover finds coral-like rock on Mars hinting at watery past
U.S. green policy rollback drives investors to Europe’s sustainable finance market
Special funerals rise in Hungary: boat, aerial and forest burials gain popularity
Hungary’s Kiskunság region turning into semi-desert after extreme drought
Kopasz Bálint wins world kayak 1000 m title in Milan, making him triple world champion
Budapest’s Keleti railway station to close for four weeks for track overhaul
Balaton could be unfit for swimming by 2035 and dry by 2050, scientists warn
Leaked guidelines show Meta’s AI allowed flirty and racist interactions with children
Filming of ‘Emily in Paris’ halted after assistant director dies on set
Filipino guest workers sue after Hungary moves to deport them for pregnancy
Ukraine Declares De Facto War on Hungary and Slovakia with Terror Drone Strikes on Their Gas Lifeline
A monster hit and a billion-dollar toy empire
Animated K-pop Musical ‘KPop Demon Hunters’ Becomes Netflix’s Most-Watched Original Animated Film
Canada: Nurse Suspended and Fined 93 Thousand Dollars After Stating the World’s Most Well-Known Fact Since the Creation of Adam and Eve, That There Are Only Two Genders
Elon Musk tweeted, “Europe is dying”
Far-Right Activist Convicted of Incitement Changes Gender and Demands: "Send Me to a Women’s Prison" | The Storm in Germany
Hungary Criticizes Ukraine: "Violating Our Sovereignty"
Will this be the first country to return to negative interest rates?
U.S. Treasury Secretary Whitney Bessent Backs Stablecoins to Boost Treasury Demand
Spain to Declare Disaster Zones After Massive Wildfires
Three-Minute Battery Swap Touted as Future of EVs
Beijing Military Parade to Showcase Weapons Advances
×