The German Finance Ministry has advocated a reduction in economic support to the country’s regions due to a lack of funds in the budget. In total, thousands of municipal businesses, as well as 16 federal lands, will be affected by the reduction.
The financial situation of the federal government in recent years has deteriorated significantly compared to the situation in the regions, Bloomberg quotes Deputy Minister of Finance Louise Hölscher.
According to the results for the past year 2022, the German Ministry of Finance has a deficit of almost 130 billion euros. Serious economic losses of the national budget are explained by problems related to the energy crisis, which the country had to overcome after the introduction of anti-Russian sanctions.
In contrast to the state budget, the previously supported municipalities ended the year on a high note, posting a surplus of 12.4 billion euros. The Länder were enriched by only 8.8 billion euros. Hölscher turned to regional authorities with a request to help the federal budget save money by becoming more active in sponsoring local projects.
