Germany wants the European Union to more than double the amount of aid that nations are allowed to dole out to individual companies as the coronavirus pandemic continues to wreak havoc across the region’s economy, reported Bloomberg.
German Finance Minister Olaf Scholz and Economics Minister Peter Altmaier pleaded with the European Commission in a letter last week for an increase in the current limit of €3 million (US$3.7 million), according to a person familiar with the discussions who spoke on condition of anonymity.
The pandemic has already forced the EU to sweep aside subsidy limits designed to avoid unfair competition between countries. But EU Competition Commissioner Margrethe Vestager has repeatedly voiced concern that Germany’s deeper pockets could risk further economic imbalances in Europe. Germany accounts for about half of the 3 trillion euros in virus aid pledged by all 27 EU governments.
The EU’s biggest economy is leading the push for a relaxation in the aid rules as Chancellor Angela Merkel seeks to regain a grip on the virus with a hard lockdown starting on Wednesday. Allowing extra state support is seen as vital to cushion the impact on thousands of companies facing up to a pandemic-induced recession.
Berlin officials are in intensive talks with Vestager’s team and seeking backing from other EU governments to increase the subsidy limits, the person said.
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