Germany’s Lindner rejects Draghi’s common borrowing proposal

BERLIN / BRUSSELS ― It took less than three hours. Germany’s Finance Minister Christian Lindner said a firm nein to Mario Draghi’s call for more common debt to boost private investment.

Lindner, whose liberal party’s share of the vote has collapsed in recent state and EU elections, told POLITICO that the pooling of “risks and liability creates democratic and fiscal problems.”

He was commenting on proposals for shared EU borrowing unveiled in Draghi’s report on the future of EU competitiveness on Monday.

“Germany will not agree to this,” Lindner said.

In his much-anticipated report, Draghi said the EU needed to invest a further €800 billion each year until 2030 as a conservative estimate. He said more common borrowing was needed and that public funding would trigger more private investment.

“Our problem is not a lack of subsidies, but the shackling of bureaucracy and a planned economy,” Lindner said. “More government debt costs interest, but does not necessarily create more growth.”

The report proposed spending €300 billion in the energy sector, investing in cross-border grids and supporting the cleantech industry. Draghi said another €150 billion should be invested in transport to create the “charging infrastructure” needed for electric vehicles, supporting a transition where European automotive producers have already been edged out by those from China.

European Commission President Ursula von der Leyen, who stood alongside Draghi when he presented his report, presented two ways to get more money: increasing the amount the EU can raise directly, and asking countries for higher contributions.