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Business

Berlin Plans Asset Sales to Cap Deficit

According to Bloomberg news service, an anonymous government official has revealed that German Finance Minister Hans Eichel is planning to accelerate sales of stakes in companies including Deutsche Telekom and Deutsche Post to state-owned bank Kreditanstalt für Wiederaufbau (KfW) in an attempt to cap the country's widening budget deficit. The move would enable Eichel to book the revenue before the KfW sells on its share to investors and ultimately entails getting rid of all the government's remaining stakes in the two former monopolies. Allegedly, the government is relying on increased revenue as the economy recovers to ease pressure on the deficit. The cabinet recently approved a supplementary budget for 2004 allowing the government €43.7 billion ($54.7 billion) in new borrowing, the most since World War II.