Must Berlin prevent Eurozone recession?

Growth in the Eurozone has slowed markedly in recent months. Experts attribute this to the trade dispute and Brexit. Business journalists say it's up to Germany to make sure there is no recession.

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Il Sole 24 Ore (IT) /

Change of direction needed

The time has come for Germany to act, economist Alessandro Penati writes in Il Sole 24 Ore:

“Budget policy should bolster domestic demand through tax cuts and investment projects. ... But Italy and France are doing just the opposite: raising public spending in the false hope that this will buy them social peace, and hence a consensus. The real turning point for the Eurozone would be if Germany were to forego its budget surplus and boost domestic demand with public investment and low taxes. That sounds crazy. But the looming recession should make it clear to Germany and the entire Eurozone that it's time to rethink their development models and economic policy management.”

Les Echos (FR) /

Selfish Germany hitting the brakes

Business paper Les Echos finds Germany's policy selfish:

“Its budget surplus allows it to calmly implement the reforms that Angela Merkel had put off until now: increased public investment (in transportation and telecommunications), the integration of migrants and foreign workers, lower business taxes. ... But that doesn't mean Germany has fulfilled its European obligations. The strength of its public finances and economy should prompt it to play a key role in consolidating the Eurozone. But today it's the one with its foot on the brake. Berlin bears most of the responsibility for the failure of the European digital tax on US companies, due to its fear of US reprisals. In view of its growing budget and trade surpluses this fearful, selfish attitude cannot continue.”