Graphic shows fiscal stimuli by selected European countries and U.S.


Germany leads Europe’s pandemic recovery

By Duncan Mil

June 25, 2020 - Germany’s €1.64 trillion “bazooka” of emergency measures protected most companies, preventing a wave of insolvencies and mass lay-offs, according to Bruegel, an economic think tank.

When Chancellor Angela Merkel set out her plan for Germany’s presidency of the EU, she said her priority was to prevent the pandemic threatening the European single market.

The task Merkel faces is enormous; Germany’s economy will not fully rebound unless Europe as a whole also recovers. That was the purpose behind the Franco-German proposal, unveiled in May, for a €500 billion post-pandemic recovery fund, financed by debt raised on capital markets by the European Commission.

Bruegel has analysed the fiscal response of 10 EU member states plus the United Kingdom and the United States in three categories.

First are “immediate fiscal impulses,” additional government spending. Second, “deferrals,” payments, including taxes and social security contributions. Third, “other liquidity provisions and guarantees,” which includes export guarantees, liquidity assistance and credit lines through national development banks.

Between March 9 and June 3, Germany’s emergency measures have totalled €1,639.7 billion -- equivalent to 47.8 per cent of GDP last year -- ahead of Italy, France and the UK with expenditures of €867.6bn, €658bn and €526.3bn (£476.0) respectively.

Germany takes the helm of the EU on July 1.

PUBLISHED: 25/06/2020; STORY: Graphic News; PICTURES: Getty Images
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