Berlin sticks to guns ahead of G20

Berlin sticks to guns ahead of G20
Photo: DPA
Berlin will not bow to pressure to boost growth with more borrowing and will "maintain that line" at this month's G20 summit, a German government source said Tuesday.

“We do not need growth bought on credit, and the Americans understand that,” the senior official, speaking on condition of anonymity, said. “We will maintain that line.”

The source acknowledged that risks to the global economy had grown significantly but dismissed the notion that the blame lay solely with the eurozone as it struggles to resolve a crippling debt crisis.

“Regarding the economic situation, there has been a significant increase in downward risks,” the official said ahead of the June 18-19 summit.

The source said responsibility for the deterioration of the global economy “rests on several shoulders” and should not be “reduced to the eurozone’s problems,” noting the role of the United States, China and some G20 emerging economies.

Germany has come under intense pressure, notably from US President Barack Obama, to do more to put an end to the eurozone crisis as it is seen as a threat to the fragile US recovery and the global economy as a whole.

However Berlin has resisted calls for new European stimulus programmes to promote economic growth, saying that fiscal discipline was the only way to restore market confidence in the eurozone.


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