Scholz pledges to launch the biggest transformation of the German economy in a century | world news


By Paul Carrel and Madeline Chambers

BERLIN (Reuters) – German Chancellor Olaf Scholz said on Wednesday his government would prepare Europe’s biggest economy for the future by encouraging investment in climate protection and digitalisation, promising that no one would be left behind in this major transformation.

The Social Democrat’s first major speech in parliament since replacing conservative leader Angela Merkel last week focused largely on domestic issues, stressing the immediate need to tackle the pandemic and the longer-term task to modernize both the economy and society.

Yet the 63-year-old, who has traveled to Paris, Brussels and Warsaw since taking office, also stressed the importance of strengthening the European Union and standing with transatlantic allies in the face of threats. security forces such as the Russian army. accumulation in Ukraine.

“We have about 23 years ahead of us in which we must and will get out of fossil fuels, which means the biggest transformation of our industry and our economy in at least 100 years,” said the new German chancellor.

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Scholz has served as vice chancellor and finance minister in coalition with Merkel for the past four years. But he vowed his unprecedented three-party coalition with the Green Greens and the Free Democrat Liberals would be a “reboot”.

Germany needs to double its renewable energy production by 2030, but also expand infrastructure like charging stations for electric vehicles, he said.

His government would create the framework for most investment in Germany’s future to be private, for example by expanding the role of the state bank in supporting start-ups.

Such a transformation could only work if there was social cohesion, Scholz said, pointing to plans to raise the minimum wage and make society more inclusive, for example through self-identification for transgender people and liberalizing citizenship laws.

“We are a country of immigration…but we have to work to become a better country of integration,” he said, adding that his government aimed to make it easier for foreigners to come to work in Germany.

Opposition lawmakers on both sides of the political spectrum have focused their criticism of the new government on its proposals to finance public investment by taking on billions of euros in debt. Those on the far left criticized him for not raising taxes on the rich and those on the right accused him of unsustainable financial policy.

At just under 70% of GDP, Germany’s debt ratio is well below that of France, at 115%, or the United States, at over 160%, but Scholz nonetheless made the point. subject to criticism over his government’s budget plans.

Opposition Conservatives said on Tuesday they would file a complaint with the Constitutional Court over plans by the new government to tap unspent debt from this year’s budget for future spending on climate and economic transformation.

Scholz said his immediate priority would be to fight the pandemic, warning that there would be “no red lines” for his government in the fight against the fourth wave in Germany and imploring citizens to get vaccinated.

He addressed foreign policy an hour into his speech, saying the success of the European Union was a top priority for Germany and that his government would work to strengthen the bloc. One of the objectives was to extend qualified majority voting to the European Council.

Scholz, who is due to attend his first EU summit as chancellor on Thursday, has big shoes to fill after Merkel helped navigate the bloc through multiple crises during his 16 years in office.

The two leaders share a down-to-earth, conciliatory manner and a calm rather than charismatic demeanor – qualities on display in his restrained speech on Wednesday in which he thanked Merkel for her handover of power which was, he said. , a global lesson in citizenship.

On Europe’s most immediate crisis, Scholz reiterated warnings that any violation of Ukraine’s territorial integrity by Russia would come at a high price, although Berlin still wants dialogue with Moscow.

“We will speak here with one voice with our European partners and our transatlantic allies,” he said.

(Reporting by Paul Carrel and Madeline Chambers; Writing by Sarah Marsh; Editing by Maria Sheahan, Alexandra Hudson and Giles Elgood)

Copyright 2021 Thomson Reuters.


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