German coalition parties under pressure to reach a deal on 2024 budget

By Anadolu staff

BERLIN (AA) - German Chancellor Olaf Scholz will meet with his coalition partners again on Friday to find a solution to the country’s budget crisis, local media have reported.

Chancellor Scholz’s crisis talks with Economy Minister Robert Habeck and Finance Minister Christian Lindner on Wednesday night failed to bring a breakthrough, and they will meet again on Friday morning, Bild daily reported.

The EU’s largest economy risks entering the new year without a proper state budget, due to disagreements between Scholz’s Social Democratic Party (SPD), and their coalition partners, the liberal FDP and environmentalist Greens.

The coalition had to revise its 2024 budget plan following a constitutional court ruling last month, which stated that the government’s reallocation of unused coronavirus funds to a climate protection fund was not legal.

Despite weeks-long negotiations, coalition partners have not yet reached an agreement on how to fill an estimated €17 billion (about $18.3 billion) gap in the 2024 budget.

While the Greens favor lifting limits on new borrowing in 2024, the liberal FDP is strongly opposing such a move, and instead proposing cuts in the social welfare system.

Finance Minister Lindner, who leads the liberal FDP, is also opposing suggestions for increasing taxes for those with higher incomes.

If the coalition partners do not reach an agreement in a couple of days, the parliamentary approval of the 2024 budget will not be possible by the end of the year, government sources have told local media.