2 December 2019. 2.2 Short- and medium-term outlook for the aggregate economy, 2020 to 2024 Germany has a full decade of continuous eco- nomic growth behind it. On Tuesday a banner headline in the Bild newspaper read “Chancellor, Hand Out the Money!” summing up the mounting cries by economists, commentators and lobbyists for the government to abandon its obsession with balancing the books – known colloquially as the Schwarze Null or black zero – and to use the money to invest in much-needed infrastructure projects across the country, as well as to reduce income tax levels. Larger-than-expected tax income and low interest rates were partly responsible for the surplus, the finance minister explained. ", Send Facebook Twitter reddit EMail Facebook Messenger Web Whatsapp Web Telegram linkedin. Just a year ago, Scholz had famously defended the government's reluctance to use its surplus, saying, "The fat years are behind us. In 2017, Germany had the largest current account surplus at $287 billion, followed by Japan at $203 billion. Germany has a new debate on its government budget. Core inflation, which excludes food and energy prices, stood at 1.4% on average in 2019. We have to make sure we're prepared for the fight against climate change," Scholz said. The government on Tuesday signed a multibillion investment deal with the national rail network, Deutsche Bahn, to which the government will contribute €62bn, and the company €24bn. He has categorically dismissed the idea of lowering the tax rate and has rejected plans to reduce the so-called solidarity tax, payable from all German incomes to finance the almost 30-year-old German reunification project. Johannes Stern. Last Friday, the German parliament (Bundestag) passed its budget for 2020… ", Every evening, DW sends out a selection of the day's news and features. What the government needs to do is to come up with a clear and long-term plan which will make the German economy fit for the future.”. Germany’s record budget surplus will continue to allow high investment levels, Finance Minister Olaf Scholz said on the sidelines of the World Economic Forum in Davos, Switzerland. Germany had a record budget surplus of € 13.5 billion ($15 billion) at the end of 2019, the Finance Ministry announced on Monday. Announcing the surplus, Scholz said: “We had a bit of luck, but of course this is also down to our good economic management.”. The German chancellor, Angela Merkel, and the finance minister, Olaf Scholz, at a cabinet meeting in Berlin. Germany recorded a government budget deficit of 68.41 EUR Billion in the third quarter of 2020. Germany posted a record-breaking EUR 21 bn surplus in the first half of 2015 but has turned a deaf ear to criticism from home and abroad that it should cut taxes or raise public spending to help alleviate pressures in the euro zone. Germany and Japan are evil-empires! Germany and Japan must have trade … "The budget surplus belongs to the taxpayers," FDP party leader Christian Lindner said, "We need wide-reaching tax breaks. Germany’s budget for 2020: Billions for rearmament and war. Despite months of weakening economic growth, the German state had a surplus of €13.5bn (£11.6bn) of income over expenditure at the end of 2019, thanks to increased tax revenues and a low interest rate. costs of Britain’s High Speed 2 project are £88bn. After registering a spectacular general government surplus of €58 billion (1.7% of GDP) in 2018, the 2019 World Economic Outlook (WEO) for 2019 forecasts an increase of €50.15 billion in German government total expenditure and an increase of €31.92 billion in revenue. The maximum surplus was 40.63 EUR Billion and deficit was -68.41 EUR Billion. You can find more information in our data protection declaration. The 2019 surplus overtook a 2015 budget surplus of €12.1 billion. “We’ve had a bit of luck, and of course we’ve economized well,” German Finance Minister Olaf Scholz said in Berlin on Monday, just a year after he claimed the “fat” years were over for Germany. The main reason for this is the implementation of the priority measures But critics said much of the money, which was announced last year, would be insufficient to make up for years of neglect. The Chinese, … Government records a billion-euro surplus. Historical Chart How much is Germany Government Budget? The deficit of government budget in Germany decreased to 68.41 EUR Billion (81.3 B USD) in the third quarter of 2020. Legal notice | The government wants to spend on infrastructure and other projects, but critics say the money isn't getting where it needs to go. In 2007 the chancellor presided over a VAT rise of 3% to boost the ailing economy. Germany and Japan must loosen Germany's and Japan's monetary-policies now! • The 2020 general government budget encompassing the Federation, Länder, local authorities and social security funds will run a smaller surplus: The budget surplus will fall from 1.9% of GDP in 2018 to roughly 1¼% of GDP in 2019 and roughly ¾% of GDP in 2020. Despite year-long reports of low economic growth, the German government ended 2019 with a double-digit billion-euro surplus. Germany and Japan must loosen Germany's and Japan's monetary-policies now! A positive value indicates a … “This overhang of billions of euros obliges Scholz and Altmaier to bring forward the end of the Soli completely,” he said. Does Germany need a stimulus package to cope with recession. A special military defense budget will receive €500 million. Despite record surplus, Germany ignores calls to spend more 28 Aug, 2015, 06.10 PM IST. The last record was in 2015, with a surplus of 12.1 billion euros. | Mobile version. Germany ended 2019 with a budget surplus of €13.5 billion. An Aging Society and Low Debt. Germany's current account recorded a surplus of €16.5 billion in August 2020, down €4.6 billion from the previous month's level. Germany and Japan must stimulate Germany's and Japan's domestic-demands now! The average tax rate – 19.7% when she came into office in 2005 – has risen to 23.2%. The government wants to spend on infrastructure and other projects, but critics say the money isn't getting where it needs to go. The need for investment in infrastructure, education, digitalisation and climate protection is overwhelming. By comparison, the most recent projections of the costs of Britain’s High Speed 2 project are £88bn. Angela Merkel’s government is coming under increasing pressure to spend some of its record budget surplus on tax cuts and investment in Germany’s ageing infrastructure. The Green party, as well as some members of Merkel’s own Christian Democrats, are pushing for surpluses to be invested in climate friendly technologies and climate shares, which would connect economic growth more directly to climate protection. Germany's trade-surplus in January 2020 Germany's trade-surplus in January 2020 Germany's trade-surplus was 18.5 billion euros in January 2020. In her almost 15 years in office, no Merkel government has ever reduced the tax bill. He added: “We should be clear that these immense surpluses despite shaky economic growth are very lucky and a chance that should not be lightly given away. Despite record surplus, Germany ignores calls to spend more 28 Aug, 2015, 06.10 PM IST. Scholz admitted that past investment attempts had not gone as expected. Scholz wants to use the extra money to maintain the federal government’s investment at a record high level of nearly 43 billion euros per year from 2020. Added to that figure is an additional €5.5 billion from a fund earmarked for refugees that went unspent, making a total surplus of €19 billion. This was chiefly attributable to a smaller surplus in the goods account. Germany's government posted a deficit of EUR 158.2 billion, or 4.8 percent of GDP, in 2020, amid efforts to curb the spread of COVID-19 and support businesses and households hit by the pandemic, a preliminary estimate showed. Aggregate economic conditions in GermanyGerman Stability Programme 2020 prices increased by 4.6%). "That will all get a bit easier now," Scholz said. This marks the third time since 2015, which until now had the record highest budget surplus of 12,1 billion, that the surplus … Germany has long been criticized internationally for stalling spending on infrastructure and other projects, leading to a stark imbalance with European partners. Together with national social security funds, the nation recorded a total budget surplus worth around 1.5% of GDP last year, said Joerg Kraemer, chief economist at Commerzbank. The president of Germany’s taxpayers’ association, Reiner Holznagel, said it was time Germans saw something of the surplus. The state had also set aside a significant sum to be used in case of a hard Brexit, which was freed up after recent UK elections took that option off the table. The list is mainly based on CIA World Factbook for the year 2016 and 2019. We use cookies to improve our service for you. Politicians from Germany's conservative Christian Democrats and business-friendly Free Democratic Party jumped on the news to advance their case for tax cuts. He added that it was important to work toward equal living conditions in Germany so that "our country sticks together.". The 2020 budget sees the first measures for more climate protection being introduced, as part of Germany’s new climate package. Germany had a record budget surplus of € 13.5 billion ($15 billion) at the end of 2019, the Finance Ministry announced on Monday. Germany has posted its highest budget surplus since reunification in 1991, inviting fresh scrutiny over whether the eurozone’s largest economy should do more to increase spending and redress global economic imbalances, the Financial Times reported. The main German stock index has risen about 48% since hitting its lowest point so far in 2020 on March 18. Germany and Japan are evil-empires! Current negative interest rates also meant that Germany paid a relatively low €12 billion in interest on its debt in 2019. Updated as of 2020. Germany ended 2019 with a budget surplus of €13.5 billion. A lack of infrastructure in rural areas, including a failure to address digital technology, is contributing to economic decline and forcing people to move away. Germany's trade-surplus in March 2020 Germany's trade-surplus in March 2020 Germany's trade-surplus was 12.8 billion euros ($13.9 billion) in March 2020. On top of the €13bn at the finance minister Olaf Scholz’s disposal, he has a further €5.5bn that was set aside during the refugee crisis of 2015. The wider European benchmark, the … It is the third time in the last five years that Europe's largest economy closed the year with a budget surplus. Germany posted a record-breaking EUR 21 bn surplus in the first half of 2015 but has turned a deaf ear to criticism from home and abroad that it should cut taxes or raise public spending to help alleviate pressures in … An editorial in Bild reminded Merkel how she had once promised to reform German tax laws and relieve the taxpayer but instead, in her 5,167 days in office had only ended up increasingly burdening them. Contact (16.09.2019), © 2021 Deutsche Welle | "We have to do something for infrastructure, for schools, for hospitals. Sign up here, The "schwarze Null," or "black zero," has come to be the most visible symbol of what many see as Germany's national obsession with a balanced budget. Germany and Japan must stimulate Germany's and Japan's domestic-demands now! Across Germany, the strains of underinvestment in everything from school buildings to bridges, parks and town halls is growing increasingly visible. The economics minister, Peter Altmaier, is reported to have concrete plans to reduce corporate tax and to get rid of the solidarity tax, or Soli as it is known. End obsession with balancing the books, and cut taxes and boost infrastructure instead, government told, Last modified on Tue 14 Jan 2020 14.50 EST. 14 Jan 2020 08.57 EST 89 Angela Merkel’s government is coming under increasing pressure to spend some of its record budget surplus on tax cuts and investment in Germany’s ageing Jan 24 2020, 3:20 PM Jan 24 2020, 8:19 PM January 24 2020, 3:20 PM January 24 2020, 8:19 PM (Bloomberg) -- Germany’s record budget surplus will continue to allow high investment levels, Finance Minister Olaf Scholz said on the sidelines of the World Economic Forum in Davos, Switzerland. Meanwhile, the issue of what to do with the surplus is causing open rifts within the government. Read more: Does Germany need a stimulus package to cope with recession? Privacy Policy | Published by H. Plecher, Dec 2, 2020 The statistic shows Germany's budget balance in relation to GDP between 2015 and 2019, with projections up until 2025. VAT on tickets for long-distance trains will be reduced from 19 to 7 percent - effectively making the tickets cheaper for travellers. "We've had decent economic developments and, through that, have brought in additional tax revenue," Scholz said. Some chutzpah indeed from a beggar-thy-neighbor country with a virtually dead economy, a nearly 2% of GDP budget surplus and by far the world's largest trade surplus of $290 billion — … The German outcome marks the sixth year in a row where the government managed to at least balance the budget. Climate protection. The largest share has been allocated to a reserve for spending related to asylum-seekers in Germany, though it could ultimately be used for other projects. NOTE: The information regarding Budget surplus (+) or deficit (-) on this … ... Richard Grenell, then the American ambassador to Germany, suggested that it made little sense that Germany would run a budget surplus… "We've had a bit of luck, and of course we've economized well," German Finance Minister Olaf Scholz said in Berlin on Monday, just a year after he claimed the "fat" years were over for Germany. Funds pegged for spending on a state and local level, in particular, have tended to get caught up in red tape and a lack of skilled civil servants to process applications, he said. Germany had a budget surplus before the coronavirus crisis, and its … Marcel Fratzscher, head of the German Institute for Economic Research, likened tax cuts to distributing water with a watering can “that would be the worst thing the government could do with this excess”. As for the rest, Germany has significant investments planned for its next budget. € 13 billion and € 500 million is Germany's budget surplus for 2019, the Berlin Finance Ministry announced, news agencies said. 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