Its European partners, starting with France, have been demanding it for several months. The ruling coalition in Germany is launching a massive 130 billion euro stimulus package. But if this should benefit all of Europe, it is Germany that will emerge strengthened.
The German locomotive is set in motion: the ruling coalition has opted for a massive recovery plan. This has long been demanded by its European partners.
Long before the Covid-19 crisis, remember, several European countries, France in particular, urged Germany to spend more. "Germany has budgetary reserves, it must play its role of locomotive", one heard in Paris or Rome. The coronavirus convinced her.
Overcoming its divisions, the coalition is launching a recovery to 130 billion euros, including 80 billion for households: three points drop in VAT to support consumption, very sharp reduction in the electricity tax, which is very expensive premiums for families across the Rhine ... In addition, there are 50 billion in favor of businesses, investment and research. Berlin wants to take advantage of the crisis to accelerate the modernization of the economy and strengthen the capital of companies.
This also means that Europe's largest economy is widening the gap with its neighbors.
We should be delighted with this revival. The German economy will draw the rest of Europe and France is in the best position to benefit from it. The other side of the coin is that Germany will strengthen its productive apparatus and effectively widen the gap with us and its neighbors in terms of competitiveness, investment in the sectors of the future.
The European recovery plan which is currently being drawn up should enable countries with less resources, including France, to keep up. But the German economic machine is getting a step ahead and it can because it has managed its public finances much better in recent years than we have: those who say that the debt does not matter have today proof to the contrary.