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December 27, 2008 Saturday
Updated
Dec 27, 2008
$50b German stimulus?
New German stimulus likely worth 25b euros
BERLIN - GERMANY will likely limit to 25 billion euros (S$50.8 billion) a second package of economic stimulus measures, with a focus on investment projects and some consumption incentives, government sources said on Friday.

The government was likely use the fresh stimulus plan to invest in infrastructure, schools and future technologies as well as introducing some consumption incentives and relief for consumers, the sources said.

At 25 billion euros, the likely scope of the plan is less than the 40 billion euros German media had reported would be spent on new projects in the new stimulus package. A Finance Ministry spokesman declined to confirm the size of the new plan.

'There have not yet been any decisions,' he said.

Chancellor Angela Merkel is under pressure to do more to boost Germany's economy, already in recession, and politicians and economists have attacked the 31 billion euros-worth of measures already pushed through as insufficient.

Dr Merkel, whose conservative Christian Democrats share power with Social Democrats, has said she will look at possible steps in January, and she meets leaders of the coalition parties on Jan 5.

Mr Ingolf Deubel, Social Democrat finance minister of the western state of Rheinland Palatinate, on Wednesday also said the second stimulus package would be worth 25 billion euros - a figure reported in two German newspapers.

Some economists say Germany, the world's biggest exporter of goods, is facing its deepest downturn since World War Two. -- REUTERS

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