“Will stand the test of time”
Habeck praises traffic light’s ‘infinite energy’
03/05/2022, 09:58 PM
The attack on Ukraine puts the governing skills of the traffic light coalition to the test. On the sidelines of the ministerial retreat, ministers Habeck and Lindner are convinced that they will master the crisis.
Despite the current major risks to economic development, the federal government sees good reason for optimism in the wake of the war in Ukraine. “We will get through this period,” said Economics and Climate Protection Minister Robert Habeck of the Greens on the sidelines of the cabinet meeting in Meseberg near Berlin. “The energy of this government is infinitely great.”
There are major challenges, in particular due to the consequences of the war in Ukraine, the federal government had considerably lowered its growth forecast for this year. Habeck specifically mentioned high energy prices and disrupted supply chains. Additionally, there is a general shortage of skilled workers and a climate-friendly transformation of the economy. But the government has answers, Habeck said. “We have the financial means, we have the political concepts, we convert the energy supply.” Business relations need to be further developed, immigration barriers in the German labor market need to be further lowered. Planning and approval procedures, for example for renewable energies, should be accelerated.
Habeck said he assumed members of the federal government would also visit Ukraine for the foreseeable future. “The fact that we as a government are not there yet, as the Federal Chancellor explained, is mainly due to the fact that the Federal President has not been invited,” said the politician from the Greens. “But there will also be a solution. We talk to each other all the time.”
Lindner against the third relief package
Finance Minister Christian Lindner of the FDP spoke of a “turning point in economic and financial policy”. For Germany to remain what it is, many things have to be changed. The federal government is not leaving people alone with high energy costs. But the state environment has changed. “We have higher costs due to inflation.” There is a greater need for action, but at the same time inflation and central bank policy are causing interest rates to rise. Therefore, the state cannot pursue an expansive financial policy in the long term.
Inflation due to supply chain bottlenecks and rising energy prices “can very quickly turn into inflation that is accelerating through the second-round effects of a wage-price spiral “, said the leader of the FDP. He spoke out against discussing a third relief package before the effects of the first two packages had reached the people.
The guests at the closed conference were Michael Hüther, director of the German Employers’ Institute of Economics, and Sebastian Dullien, director of the Institute for Macroeconomics and Business Cycle Research at the Hans Böckler Trade Union Foundation.