[Berlin 25th Reuters]-Dieter Kemp, chairman of German industry association (BDI), Germany's leading economic group, said that interest payments will be curbed by negative yields on German bonds on the 25th, while demand from investors is very strong In light of this, the government insisted that the policy of balancing the fiscal balance without issuing new government bonds should be withdrawn.
The Merkel German government should withdraw from the policy of fiscal balance and make new borrowings under the financial discipline stipulated by the Constitution to support the domestic economy that is concerned about entering into recession. Voices are rising both at home and abroad.
President Kemp told a foreign media in Berlin that the government can issue 10-12 billion euros of government bonds per year under the financial regulations set out in the constitution.
He pointed out that the situation surrounding the economy changed as the economy fell. At the same time, he said that there is strong potential investment demand for Germany, and investors want to invest in new government bonds even if they pay a surplus despite the negative yield on German bonds.
The coalition party agreed last week to implement a policy package aimed at combating climate change without issuing new government bonds. However, environmental protection organizations criticize that more detailed measures are needed.
