Scholz pledges to initiate the biggest transformation of the German economy in a century


German Chancellor Olaf Scholz speaks as he delivers a government statement at a plenary session of the lower house of the German parliament, the Bundestag, in Berlin, Germany, December 15, 2021. REUTERS / Michele Tantussi

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  • Focuses on national issues by addressing parliament
  • Focuses on social cohesion and the modernization of Germany
  • Wants to double renewable energy production by 2030
  • Says EU success is top priority for Germany

BERLIN, December 15 (Reuters) – German Chancellor Olaf Scholz said on Wednesday his government will prepare Europe’s largest economy for the future by encouraging investment in climate protection and digitization, vowing that no one will be left behind for account in this major transformation.

The Social Democrats’ first major speech in parliament since the replacement of conservative leader Angela Merkel last week focused largely on domestic issues, underscoring 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 alongside transatlantic allies in the face of threats. security forces like the Russian army. accumulation in Ukraine.

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“We have about 23 years ahead of us in which we must and will move away from fossil fuels, which means the greatest transformation of our industry and our economy in at least 100 years,” said the new German Chancellor.

Scholz has been vice-chancellor and finance minister in coalition with Merkel for the past four years. But he vowed that his unprecedented three-way coalition with the Green Greens and the Free Liberal Democrats would be a “reboot.”

Germany must double its production of renewable energy by 2030, but also expand its infrastructure such as charging stations for electric vehicles, he said.

His government would create the framework for most investments 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, highlighting plans to raise the minimum wage and make society more inclusive, for example through the self-identification of transgender people and liberalization of citizenship laws.

“We are a country of immigration (…) but we must work to become a better country of integration”, he declared, adding that his government aimed to facilitate the work of foreigners 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 investments with billions of euros in debt. Those on the far left criticized him for not raising taxes for the rich and those on the right accused him of an unsustainable financial policy.

At just under 70% of GDP, Germany’s debt ratio is much lower than that of France, at 115%, or the United States, at over 160%, but Scholz has been criticized nonetheless. on his government’s budget plans.

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

NO RED LINES

Scholz said his immediate priority would be to fight the pandemic, warning that there would be “no red lines” for his government in tackling Germany’s Fourth Wave and imploring citizens to get vaccinated.

He addressed foreign policy an hour after starting 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 expand qualified majority voting in the European Council.

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

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

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

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

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

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