Latest news with #Kukies
Reuters
28-04-2025
- Business
- Reuters
Germany asks for EU leeway on defence spending, letter shows
BERLIN, April 28 (Reuters) - Germany has asked the European Commission for an exemption from European Union borrowing limits in order to increase defence spending in the coming years, according to a letter from German Finance Minister Joerg Kukies seen by Reuters on Monday. Kukies told Reuters in an interview on Friday that Germany was likely to request the exemption. The European Commission has proposed allowing member states to raise defence spending by 1.5% of gross domestic product (GDP) each year for four years without any disciplinary steps that would normally kick in once a deficit is above 3% of GDP. "We see the Commission's proposal for a coordinated activation of the National Escape Clause of the Stability and Growth Pact as an important complementary measure to enable increased national defence spending while safeguarding fiscal sustainability," Kukies said in the letter. The Commission had hoped the proposal would be widely taken up by the 27 EU countries and help boost EU defence investment by 650 billion euros over the next four years to deter potential Russian aggression. However, only Portugal and Poland had so far signalled interest in the exemption. EU countries with high national debt are sceptical of borrowing more to spend on defence. Germany's request may encourage other countries to follow the path, although its government debt ratio of 62.5% of GDP in 2024 is much lower than that of Italy, France and Spain, which are all above 100% and reluctant to apply for the exemption.
CNBC
27-04-2025
- Business
- CNBC
European deregulation push creates 'moment of opportunity' to boost growth
Spurring European deregulation and economic growth was a powerful theme that emerged as an answer to challenges raised by the U.S. tariff campaign and questions about American "exceptionalism" at the International Monetary Fund's annual spring meeting in Washington last week. European officials pointed to the idea of regulatory "simplification" as a way to boost business after years of sclerotic growth. "We have gone too far in regulating the risk, and we've forgotten about regulating the growth," Rachel Reeves, the U.K. Chancellor of the Exchequer, said during a panel discussion moderated by CNBC's Sara Eisen on Thursday. At the same forum, German Finance Minister Jorg Kukies highlighted the need to lower "duplicative and multiplicative" regulations on companies. "We do have to also encourage and grow and make more prosperous the venture capital investing scheme in Germany, in the European Union," Kukies said. Britain and Germany are Europe's two largest economies. Sentiment shift The views from London and Berlin are part of a notable sentiment shift throughout Europe, long plagued by slower growing economies and stock markets that until recently have lagged the U.S. ever since the Global Financial Crisis. Over the past few months, European Commission President Ursula Von der Leyen and former European Central Bank President Mario Draghi each raised concern about the region's lack of competitiveness and fading productivity. In response, the European Commission, the executive arm of the European Union, adopted a package of proposals in February that it said "will cut red tape and simplify EU rules for citizens and business," aiming to "reduce administrative burdens by 25%, and by 35% for small- and medium-sized businesses" sometime in 2029. Reeves in the U.K. has also taken aim at excessive regulation, especially environmental rules governing major infrastructure projects. Kukies, the German finance minister, has a history in the private sector that's informed his push for deregulation, according to Isabelle Mateos y Lago, chief economist at BNP Paribas, the largest bank in France. "He's been one of the strongest proponents of deregulation, and I think he actually means deregulation, not just simplification," Mateos y Lago told CNBC. "And then in the U.K., they've already made a number of high profile decisions around permitting that really show that there is now a desire to make growth really a priority — and not the number five priority, after a lot of other things." The economist, who calls herself "a permanent, perennial, indefatigable optimist about Europe," pointed to increasingly positive sentiment toward European growth. "Most of the time, you feel lonely being in that mindset, especially in the U.S.," said Mateos y Lago. 'Moment of opportunity' "But I cannot tell you the number of panels or meetings or conversations I've had this week, where you hear people say, 'this is a moment of opportunity for Europe,'" she added. "There is really reason to be optimistic, because there's this consensus at the policy level. There is a blueprint now [and] the intention to get all this — administrative simplification — done." The culture shift on the continent and U.K. — plus easier credit from the Bank of England and European Central Bank — has excited investors about economic growth prospects, especially against a backdrop of tariff-induced instability and weakening confidence in U.S. exceptionalism and dollar dominance. Both the continent's Stoxx Europe 600 Index and the U.K.'s FTSE 100 Index are up about 3% in 2025 while the S & P 500 has fallen 6%. Including reinvested dividends, the recent outperformance is even greater. But Europe has a long way to go to turn things around and convince the skeptics. Since the financial crisis in 2008, the Stoxx 600 index has returned 223% and the FTSE 100 even less, at 191%, according to FactSet data. The S & P 500 has soared 510%. —CNBC's Michael Bloom contributed to this report. Get Your Ticket to Pro LIVE Join us at the New York Stock Exchange! Uncertain markets? Gain an edge with CNBC Pro LIVE , an exclusive, inaugural event at the historic New York Stock Exchange. In today's dynamic financial landscape, access to expert insights is paramount. As a CNBC Pro subscriber, we invite you to join us for our first exclusive, in-person CNBC Pro LIVE event at the iconic NYSE on Thursday, June 12. Join interactive Pro clinics led by our Pros Carter Worth, Dan Niles, and Dan Ives, with a special edition of Pro Talks with Tom Lee. You'll also get the opportunity to network with CNBC experts, talent and other Pro subscribers during an exciting cocktail hour on the legendary trading floor. Tickets are limited!
Reuters
25-04-2025
- Business
- Reuters
Germany likely to apply for EU leeway on defence spending, finmin says
BERLIN, April 25 (Reuters) - Germany is likely to ask the European Commission for an exemption from European Union borrowing limits to increase defence spending in coming years without breaking EU rules, German Finance Minister Joerg Kukies told Reuters on Friday. "It looks likely that we may do that, but the final decision needs to be taken," Kukies said in an interview, adding that this is being discussed in the German government in coordination with the incoming parties. The European Commission has proposed allowing member states to raise defence spending by 1.5% of GDP each year for four years without any disciplinary steps that would normally kick in once a deficit is above 3% of GDP. Portugal has signalled it would ask for an exemption and Poland is likely to as well, Reuters reported on Thursday. The European Commission had hoped the proposal would be widely taken up by the 27 EU countries and help boost EU defence investment by 650 billion euros over the next four years to deter a potential Russian invasion.
Business Mayor
25-04-2025
- Business
- Business Mayor
German finance minister says trust not yet broken with U.S., prefers zero-for-zero tariff solution
The trust between Europe and the U.S. is not yet broken despite President Donald Trump's aggressive tariff policies, Joerg Kukies, acting German finance minister, told CNBC Thursday. 'For trust to be broken, a lot more would have to happen because the transatlantic partnership has been built over so many decades that we will not get carried away by the statement of tariffs,' he told CNBC's Carolin Roth on the sidelines of the IMF World Bank Spring Meetings. Kukies added that during a previous visit to Washington, soon after the 25% tariffs on all cars imported to the U.S. was announced, there did appear to be interest in coming to an agreement. Europe and the U.S. have different interests and both parties need to understand one another's viewpoints, he said. 'But this is not the first time ever that the United States and Europe are negotiating over tariffs, so I don't think we're anywhere near a crisis moment.' Kukies struck a positive tone when referring to talks, saying 'everything is going in negotiation mode' with the bloc 'optimistic' that it can resolve the differences. A zero-for-zero tariff agreement would be his preferred outcome, Kukies stated. This aligns with what European Commission President Ursula von der Leyen has advocated for. However, Trump has already rejected a proposal from the European Union for a deal which would see zero percent duties on industrial goods imported from the U.S. as well as on imports from the EU. Germany is currently subject to 10% tariffs — the temporarily reduced rate announced by Trump after the initially imposed 20% duties. Read More China's property market edges toward an inflection point The country's struggling economy is heavily reliant on trade, as the U.S. serves as its most important trading partner. Tariff turmoil led by Trump is therefore expected to hit Germany especially hard. Earlier on Thursday, the German government revised its forecast for the country's economic growth lower, saying it was now expecting stagnation in 2025. This compares to January's estimate of 0.3% growth. Acting economy minister Robert Habeck in a press conference cited U.S. President Donald Trump's trade policies and their impact on the German economy as the main reason for the downward revision. The IMF in its latest World Economic Outlook, which was published earlier this week, also cut its expectations for the German economy with the body now projecting a 0.2% contraction. Germany's economy has been struggling for some time, contracting in both 2023 and 2024 on an annual basis. The country has however avoided a technical recession, which is characterized by two consecutive quarters of contraction. The latest gross domestic product data is slated to be released next week. There could however also be some positives on the horizon after a major fiscal package, which could lead to a major investment boost, was enshrined in Germany's constitution earlier this year. It included changes to the long-standing debt brake rule that are set to enable higher defense spending, as well as a 500 billion euro ($569 billion) infrastructure investment fund. Germany's debt brake limits how much debt the government can take on and dictates the size of the federal government's structural budget deficit READ SOURCE
Bloomberg
24-04-2025
- Business
- Bloomberg
Germany's Kukies Sees Zero Tariffs as Best EU-US Deal
German Finance Minister Joerg Kukies said a trade deal that would see the European Union and the US zero out tariffs on industrial products 'would be the ideal outcome from a economic perspective it would be certainly to most efficient outcome for both sides.' Kukies spoke with Lisa Abramowicz about trade negotiations with the US, manufacturing in China, and what he sees as Germany's biggest economic hurdle. (Source: Bloomberg)
