German Bundestag approves EU recovery fund

German Chancellor Angela Merkel (R) and German Minister of Finance Olaf Scholz (L) in Berlin, Germany, 25 March 2021. [EPA-EFE/CLEMENS BILAN]

The lower house of parliament approved the legislation for the EU recovery plan on Thursday, with Chancellor Angela Merkel stressing that the EU’s plan to take on joint debt and channel the money to member states worst hit by COVID-19 will create an important tool to overcome the crisis, but must be a one-off event.

The legislation passed by a large majority, garnering support not only from Merkel’s conservative bloc and the centre-left Social Democrats junior coalition partner but also from the opposition Greens and business-friendly Free Democrats. 478 out of 645 MPs backed the bill.

“In the debate today, it will be made clear again that the recovery fund is a one-off instrument limited in time and purpose,” Merkel said, adding that it was an “indispensable” tool to help overcome the COVID-19 economic crisis.

The question of whether the EU should take on joint debt for other tasks in the future is likely to be a key topic in campaigning for Germany’s federal election in September.

Finance minister and SPD chancellor candidate Olaf Scholz has said that strengthening relations within Europe would be one of his top priorities. He has hinted that he does not view the EU recovery plan as a one-off event.

Germany’s upper house, the Bundesrat, is expected to pass the bill on Friday.

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