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May 20, 2010

Germany's Parliament Approves Euro Aid Package

Germany's parliament has approved the country's contribution to a $1-trillion aid package to protect debt-ridden European countries and stabilize the euro currency.

German lawmakers in the lower house of parliament, the Bundestag, voted 319 to 73 for the bailout package.  The measure passed, but with 195 abstentions.  The upper house also lent its approval.

That gives the go ahead for Germany to contribute up to nearly $200 billion to a package of loan guarantees to stave off default by some of Europe's weaker and more debt-ridden economies, and thereby hopefully stabilize the euro.

German Finance Minister Wolfgang Schaueble told lawmakers it is in Germany's national interest.

He said it is in Germany's interest to remain integrated in a Europe that is growing more and more together.  The common currency and the economic alliance, he said, is a great advantage to Germany.

This latest aid package comes on the heels of an earlier rescue plan for Greece.  Germany is having its own economic difficulties and bailout packages for countries that many blame for fiscal irresponsibility are not popular among the German public.

Earlier in the week, German Chancellor Angela Merkel warned lawmakers the measures were necessary to save the euro and Europe.

It's our historic task, she said.  If the euro fails then Europe fails, she added.  But, she said if this crisis can be overcome both the currency and Europe will be stronger than before.

Analysts warn that bailout packages alone will not be enough to stabilize the euro.  They say tougher measures to regulate public spending in individual countries are needed.

European finance ministers gathered in Brussels Friday to discuss such measures including new, tougher rules for public finances and government action to cut debt.