By Chris Cermak
WASHINGTON(MNI) – German finance officials on Friday rejected calls
for Europe’s largest economy to undertake more stimulus measures as a
means of propping up growth in the Eurozone.
Bundesbank President Jens Weidmann said he believed a German
stimulus programme would have little effect on growth in the flagging
euro area and could lead to “problematic side effects” by further
undermining market confidence in the ability of Europe to reduce its
fiscal deficits.
Germany’s Finance Minister Wolfgang Schaeuble said that G20 finance
ministers and central bank governors had agreed at a dinner in
Washington Thursday night that their goal should continue to be fiscal
consolidation. The United States had been pushing for the stronger
European nations to consider more spending measures.
If the crisis stems from a lack of market confidence in Europe’s
handling of budget deficits, “then it is completely clear that the
crisis cannot be fought by making the [problem] larger,” Schaeuble told
reporters in Washington.
Schaeuble said that quick approval by Eurozone governments of the
July 21 agreement to expand the European Financial Stability Facility
was key to restoring confidence. He said he expected the national
parliaments of Eurozone member states to have passed the measure by the
time G20 finance ministers meet in France in the second week of October.
— Chris Cermak is a Washington, D.C. reporter for Need to Know News
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