Economy minister Peter Altmaier announces approval from the European Commission’s state aid authority for the €600 billion WSF
After months of delay, Berlin is moving ahead with a plan to recapitalize corporates with state money, in what one government says could amount to a “nationalization of the German Mittelstand”.
Economy minister Peter Altmaier announced approval from the European Commission’s state aid authority on July 8 for the new €600 billion economic stabilization fund (Wirtschaftsstabilisierungsfonds, or WSF).
This gives a template for WSF injections of up to €250 million in equity and mezzanine capital into German companies hit hard by the coronavirus crisis.
Approval has taken since March, when the government first announced the WSF’s creation, in part because the programme has proven so controversial.
German mid-caps are facing “an equity meltdown due to the coronavirus,” says Volker Treier, head of foreign trade at the German chambers of commerce association, the DIHK. But politicians have argued over the WSF’s conditionality for things such as management pay and dividends.
