German Economy Minister Cancels Trip to Attend Budget Crisis Talks

According to Yahoo News, German Economy Minister Robert Habeck has canceled his trip to the COP28 climate conference and the Middle East to attend talks in Berlin focused on resolving the country's budget crisis. Chancellor Olaf Scholz requested Habeck's presence to make further progress in the discussions on the 2024 budget following the ruling of the Constitutional Court. Scholz, Habeck, and Finance Minister Christian Lindner of the pro-business Free Democrats held talks on Sunday evening and are expected to continue them throughout the week. Germany has been grappling with the budget dilemma since mid-November when the country's top court ruled that the allocation of €60 billion ($65 billion) in unused Covid-19 pandemic aid for climate protection to special funds outside the regular budget was unconstitutional. The Finance Ministry froze the current budget and the two largest special funds, and the government declared an emergency for 2023 to restore this year's budget. Lindner has identified a €17 billion gap for next year and favors plugging it with cuts in social welfare spending. Scholz's Social Democrats and Habeck's Greens want to suspend the so-called debt brake, a limit on net new federal borrowing, in 2024 and take up new debt to cover the shortfall in order to invest in Germany's clean-energy transition. Habeck, who is also the vice chancellor and in charge of climate affairs, expressed optimism late Sunday that the coalition is 'well on the way to reaching an agreement.' Habeck had planned to attend the UN climate conference in Dubai on Tuesday, followed by visits to Oman, Saudi Arabia, and Israel. The trip was postponed until the next possible date, according to a spokeswoman.