Since the USA protects its industry with subsidies, Commissioner Gentiloni calls for a support program for the EU economy. He sees the taking on of joint debts as unavoidable. The Federal Minister of Finance, Lindner, is not very enthusiastic about the matter.
Against the background of the US subsidy program, Federal Finance Minister Christian Lindner spoke out against an “excessive” expansion of subsidies for companies in Europe. After a meeting with EU Economic Commissioner Paolo Gentiloni in Berlin, the FDP politician said that state aid law must become more agile. “We have to come to decisions faster. But we don’t need an excessive expansion of subsidies in the European Union.”
The market economy framework would have to be improved. “You can also make politics for the economy without money, simply by avoiding regulation and bureaucracy.” Lindner warned of a subsidy competition with the USA. “For this reason, we see no need for new financing instruments at the European level,” he said, referring to a debate on joint debt.
Gentiloni had called on the federal government to support the demand for new EU debt. Energy prices and competition with China pose major challenges for the EU, and there is also the threat of a subsidy race with the USA, Gentiloni told the “Frankfurter Allgemeine Zeitung”. “We have to take into account that not every Member State can do all this on its own,” said the Italian. There is no way around a European solution and new debts.
“We must – also as a signal to the financial markets – avoid the impression that we are just moving existing money back and forth. We need new money – and we have to be quick,” said Gentiloni. Lindner, had previously spoken out against new joint EU debt. Federal Chancellor Olaf Scholz repeatedly pointed out that only a fraction of the 750 billion euros from the reconstruction fund had been used so far. The European heads of government decided on this in 2020 to deal with the economic consequences of the corona pandemic.
The distribution began in June 2021. The money will be distributed to the member states according to quotas and must be earmarked for digitization and climate protection programs. 360 billion will be issued as loans, repayable by 2058. 390 billion are grants that member states do not have to repay.
Countries like France and Italy, but also EU Council President Charles Michel, had recently called for joint EU debt in order to be able to counter the US billion-dollar program to promote green technologies – the “Inflation Reduction Act” – with their own aid. They warn of a de-industrialization of Europe.
