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No fresh borrowing in the years ahead?

German Finance Minister Wolfgang Schäuble is confident that Europe's powerhouse can fare without fresh borrowing up to 2020. Higher labor market spending is to be offset by steadily rising tax revenue.

The German cabinet on Wednesday threw its weight behind the benchmark figures in Finance Minister Wolfgang Schäuble's draft budget for 2017 to 2020.

According to the document, Germany plans to boost spending by more than 30 billion euros ($33.65 billion) up until 2020, without straying from its balanced budget.

An influx of more than 1.1 million migrants to Germany last year alone had raised the question of whether the nation would soon have to resort to fresh borrowing in order to

cover the costs of accommodating and integrating the new arrivals.

But Schäuble insisted the extra costs would be offset by rising tax revenue due to a robust labor market and record-low unemployment.

The German cabinet is expected in July to approve the whole draft 2017 budget and financing plan up to 2020.

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Security a priority

Reacting to the terrorist attacks in Brussels, the finance minister emphasized that more money would be allocated to boosting security in the country.

A closer look at the 2017 draft budget shows though that the biggest chunk (137.7 billion euros) would go to the Labor Ministry, including extra money for the statutory pension fund.

The Defense Ministry is to get 36.6 billion euros in 2017 - 2.3 billion euros more than this year - the draft budget says.

hg/jtm (Reuters, dpa)

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