Merkel Says Germany ’Can Afford’ More Debt to Fund EU Recovery

By Staff, Agencies

Chancellor Angela Merkel said Germany can afford to take more debt to help fund an unprecedented economic recovery program for the European Union, because it's in Germany's own interest to see the bloc thrive.

In an interview with six European newspapers released Friday, Merkel said that "the coronavirus pandemic is confronting us with a challenge of unprecedented dimensions."

The EU's economies, like those of countries around the world, have slumped dramatically since the start of the outbreak.

Merkel and French President Emmanuel Macron last month proposed creating a one-off 500 billion-euro recovery fund that would be filled through shared borrowing with other EU member countries. Such a move breaks with Germany's long-standing opposition to joint borrowing.

Merkel noted in an interview with several media outlets that it was right that those countries that have been particularly hard-hit by the pandemic should receive special consideration from the recovery fund.

"For Italy and Spain, for example, the coronavirus pandemic signifies a huge burden in economic, medical and, of course, because of the many lives lost, emotional terms," she said. "In these circumstances, it is only right for Germany to think not just about itself but to be prepared to engage in an extraordinary act of solidarity."

Merkel insisted that while the fund "cannot solve all of Europe's problems," without it they would only get worse.

"Germany had a low debt ratio and can afford, in this extraordinary situation, to take on some more debt," Merkel said, adding: "It is in Germany’s interest to have a strong internal market and to have the European Union grow closer together, not fall apart. As ever, what’s good for Europe is good for us."