BERLIN (MNI) – German federal net new borrowing last year fell to
E17.3 billion, German Deputy Finance Minister Steffen Kampeter said
Thursday.
The number is way below the E48.4 billion initially earmarked in
the 2011 budget bill.
The better-than-expected deficit development is mainly due to
strong economic growth last year, which led to higher tax revenue and
lower unemployment spending and interest rate payments, Kampeter
said.
The deputy minister said that federal net new borrowing this year
might also be below the E26.1 billion earmarked in the 2012 budget bill.
However, the government will likely have to present a supplementary
budget this year in case it decides to pay in 2012 more than the
initially planned E4.5 billion into the European Stability Mechanism
(ESM), Kampeter cautioned.
In that case, the government won’t be able to push federal net new
borrowing in 2012 below the planned E26.1 billion.
In a separate statement, the finance ministry pointed to
“significant risks” for the federal budget this year due to the
weakening economy and uncertainties regarding future interest rate
payments and further measures to counter the sovereign debt crisis in
the Eurozone.
In 2013, the government wants to bring down federal net new
borrowing to E24.9 billion, as projected in its medium-term fiscal plan
dating from last summer, Kampeter said.
–Berlin bureau: +49-30-22 62 05 80; email: twidder@marketnews.com
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