The Germans did not take even three hours to respond, as we expected, to the proposal. Dragi for joint debt issuance.
Your finance minister Germany Christian Lindner said a resounding no to Mario Draghi’s call for a Eurobond to finance investments.
Lindner, whose FDP collapsed in recent state and EU elections, told POLITICO that the concentration of “risks and responsibilities creates democratic and fiscal problems.”
He was commenting on proposals for joint EU loans outlined in Draghi’s report on the future of EU competitiveness on Monday. “Germany will not agree to this,” Lindner said.
In his long-awaited report, Draghi said essentially that Europe faces an “existential problem” and that the EU needs to invest an additional €800 billion every year until 2030, a conservative estimate. That is more than double the amount spent on the Marshall Plan after World War II.
Draghi argued that more public borrowing was needed and that public financing would trigger more private investment.
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“Our problem is not a lack of subsidies, but the shackles of bureaucracy and the planned economy,” Lindner said. “More public debt costs interest, but does not necessarily create more growth.”
The report suggested spending €300 billion on the energy sector, investing in cross-border networks and supporting the cleantech industry.
Draghi said an additional 150 billion euros would be needed to invest in transport to build the “charging infrastructure” needed for electric vehicles, supporting a transition in which European carmakers are already being squeezed by the Chinese.