Germany's fiscal deficit will top Ђ40 billion this year, a record sum nearly double the previous forecasts that could yet rise to 5 per cent of gross domestic product (GDP) by the end of the year.
Mr Hans Eichel, the finance minister, admitted at the weekend that the government will break the previous national debt record held by the Kohl government.
Taken with the combined debts of the federal states, Germany is now Ђ80 billion in the red.
"Up until now I've assumed the deficit would be approximately double the earmarked amount of 18.9 billion," he said on public television. "We shall pass the [Ђ40 billion] mark because the present declining economic situation has seen income fall and at the same time we are forced to spend more on unemployment benefit."
