Germany unveils €130bn stimulus to kickstart virus-hit economy
In case you missed this earlier: Germany will plough €130bn (US$146 billion) into a stimulus package to kick-start an economy severely hit by the coronavirus pandemic, Chancellor Angela Merkel said Wednesday.
Under the wide-ranging measures outlined in a 15-page document, value-added tax will be temporarily slashed, families will receive 300 euros for each child, while those who purchase electric cars will see a government rebate doubled to €6,000.
“The size of the package will reach €130bn for 2020 to 2021, €120bn of which will be borne by the federal government,” said Merkel.
“We have an economic stimulus package, a package for the future and in addition, we’re now dealing with our responsibility for Europe and the international dimension.”
Noting that millions of employees in Germany have been put on shorter working hours, Merkel said that “shows how fragile the whole thing is, and why we must succeed in giving the economy a push so that jobs can be secured.”
“We need to get out of this crisis with an oomph,” said Finance Minister Olaf Scholz.
The fresh stimulus comes on top of a massive €1.1tn rescue package already agreed in March, comprising loan guarantees, subsidies and a beefed-up shorter-hours programme to avoid job cuts.
To fund the unprecedented package, parliament had approved new borrowing, marking a sea change in German economic policy, upending a financial-crisis-era constitutional rule drastically limiting budget deficits.
Hello and welcome to today’s live coverage of the coronavirus pandemic with me, Helen Sullivan.
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A €130bn (£116bn) post-lockdown stimulus package has been agreed by the coalition partners running the country, the chancellor Angela Merkel announced. The agreement paved the way for a fiscal programme that is substantially bigger than similar packages by Germany’s Eurozone partners.
Meanwhile the World Health Organization says that for the past five days, cases have risen by 100,000 a day worldwide.
Here are the key developments from the last few hours:
- Known coronavirus cases number around 6.4m, according to Johns Hopkins University, with the current number at 6,392,319. There have been 383,298 deaths reported so far.
- Spain’s congress voted to approve a sixth and final two-week extension of the country’s state of emergency. It has been in effect since 14 March and Wednesday’s vote means that the exceptional measures that have underpinned one of Europe’s strictest lockdowns will now remain in force until 21 June.
- The UK’s business secretary Alok Sharma went into self-isolation after beginning to feel unwell in the House of Commons chamber.He was delivering the second reading of the corporate governance and insolvency bill.
- The World Health Organization said it has received reports of 100,000 new cases every day for the past five days, as the outbreak gathers pace in various regions around the world.
- The WHO director general, Dr Tedros Adhanom Ghebreyesus, also said it has resumed trials of hydroxychloroquine, an arthritis drug that had been used to treat Covid-19 patients, after reviewing studies that apparently showed it was dangerous.
- Pakistan recorded its largest single day increase in infections, as a fourth politician died after testing positive for the virus. Mian Jamshed Kakakhel, who was a member of a provincial assembly in the north-west, died on Wednesday. Yesterday two other lawmakers died after testing positive.
- The number of Covid-19 deaths per capita in Sweden surpassed that of France. With 450 deaths per 1 million people, Sweden now has the seventh-worst death rate in the world, according to tallies kept on the Worldometers website.
- Entry checks at land borders to Austria introduced because of the pandemic will be scrapped from Thursday, except for those at the border with Italy, Austria’s foreign minister announced. The controls on the Italian border will be evaluated again next week, Alexander Schallenberg told a press conference.
- The UK government was criticised for failing to release test and trace data. The former health secretary, Jeremy Hunt, told the programme’s chief, Dido Harding: “I hope you understand that our frustration is that it is very hard to scrutinise what the government is doing if we’re not given the data that allows us to do that.”
- Germany will continue to warn against non-essential travel to the UK while it maintains its 14-day quarantine rules, despite removing curbs for travel to the rest of Europe. The foreign minister, Heiko Maas, said his government will scrap general travel warnings for 30 countries, including the UK, from 15 June.