MNI: Germany To Submit Debt Plan Later On Thursday - Officials

Germany is expected to submit long-awaited fiscal structural plan to the European Commission later on Thursday, sources have told MNI, adding that it is still possible it could be for seven rather than four years.

While media reports earlier this week indicated that the plan would be for four years, an extended plan would allow for reforms and investments to be made and, in this case, would provide time for Germany to implement its major infrastructure and defence plans. (See MNI INTERVIEW: Germany Needs Favourable EU Fiscal Treatment)

While the reports suggested that the Commission had also allowed Germany to raise its potential growth rate to 0.9% from 0.5%, officials said that the new rate is a potential growth rate rather than the actual potential rate, and smoothed over an extended period of time.

This smoothing is allowed under the new fiscal rules introduced last year and has been already applied by the Commission to the Austria, Portugal, Romania and Finland plans.