Germany's state and federal governments will jointly fund flood aid of up to 8 billion euros ($10.7 billion). The deal opens a quick path to relief in areas damaged by the country's worst flooding in over a decade.
Finance Minister Wolfgang Schäuble met with state leaders in Berlin on Wednesday to finalize the aid deal for the victims and areas hit by heavy flooding.
The federal government will finance all the so-called "reconstruction aid" upfront. States, called Länder, will pay back 3.25 billion euros through debt retirement and interest payments over 20 years.
"The uncertainty of the citizens has an end," said Schäuble. "Now we can quickly provide the funds for the flood victims."
The federal government will alone bear the infrastructure costs, including costs such as highway repair. Those costs come to 1.5 billion euros, reducing the amount split with states to 6.5 billion euros.
Federal and state governments agreed last week to provide 8 billion euros to cover flood damages. The exact details of Wednesday's agreement will be clarified no later than July 5, before the government's summer break.
Because of the high debt the government will have to take on, Schäuble will set forth a new supplementary budget for 2013.
Thuringia's State Premier Christine Lieberknecht said the relief was modeled after the plan for the devastating floods of 2002, calling it "an important signal for the people in the affected areas."
dr/rc (dpa, Reuters, AFP)