Chancellor Olaf Scholz has unveiled a deal on Germany’s budget for next year and a package of economic reforms designed to stabilise a coalition that had been driven to the brink over arguments on spending.
The package includes measures to boost corporate investment, tax incentives for R&D and steps to encourage people to re-enter the labour market and work longer hours. Ministers expect it will boost next year’s GDP growth by 0.5 percentage points.
But it was unclear whether the new budget would improve the fortunes of a government whose popularity has slumped in the face of near-constant bickering between coalition partners and a flatlining economy.
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