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Oct 19, 2014 6:17 AM

German finance chief: confident on balanced budget

The Associated Press

BERLIN (AP) Germany's finance minister said he is confident he can keep promises to balance the budget next year and rejected anew in an interview published Sunday suggestions that the country should borrow to finance greater public investment.

Chancellor Angela Merkel appears determined to stick to plans to get by without new borrowing next year for the first time since 1969, though Germany's growth outlook has weakened and Berlin faces calls from abroad to pump money into the economy.

Finance Minister Wolfgang Schaeuble acknowledged in the Welt am Sonntag newspaper that Germany "must invest more and improve our competitiveness."

"We just don't want growth on credit," he added.

Schaeuble said it's important to keep promises and said he is confident a balanced budget can be achieved because "tax income doesn't react so quickly to economic changes."

On Monday, Schaeuble will meet the French finance and economy ministers in Berlin to discuss ways of encouraging investment.

France is under pressure to get its public finances in order after admitting that its 2015 budget would break promises to bring its deficit below the European Union limit of 3 percent of gross domestic product within two years and that its 2014 deficit would increase rather than fall.

The French ministers were quoted as suggesting to the German daily Frankfurter Allgemeine Zeitung that Germany increase its investment over the next three years by the same amount France cuts its spending.

Saving 50 billion euros ($63.8 billion) in France while Germany increases investment by that amount "would be a good balance," Economy Minister Emmanuel Macron said, according to a preview of Monday's edition.


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