Germany to decide on new economic stimulus late next month

Special Report:Global Financial Crisis

BERLIN, Dec. 14 (Chinese media) -- The German government will decide whether to

adopt fresh measures to stimulate the flagging economy at the end of January,

said German Economy Minister Michael Glos after a Sunday crisis meeting hosted

by Chancellor Angela Merkel.

Some 32 ministers, business leaders and experts gathered at the seven-hour

meeting aimed at taking stock of the economic situation, and considering

possible measures to prevent further meltdown of Europe's largest economy, which

officially slid into recession in October.

Finance Minister Peer Steinbrueck said after the meeting that they have

agreed to consider more investment in public projects such as education,

infrastructure and broadband networks.

Steinbrueck added that measures will be examined on how to minimize the

impact of the economic crisis on the job market.

According to the German news agency DPA, good news from the meeting was

that leaders of Germany's biggest companies have expressed willingness to

refrain from massive layoffs in 2009.

Earlier Sunday, both Merkel and Foreign Minister Frank-Walter Steinmeier

stressed the importance of protecting jobs.

Steinmeier, the Social Democratic Party's candidate to challenge Merkel in

the 2009 general elections, said that 2009 "could not be allowed to become the

year of lay-offs."

Whether to cut income tax to spur growth remained a controversial issue at

the meeting, said Glos.

With bad news coming almost every day, the German government is under

increasing pressure to adopt new economic stimulus measures.

The government's existing growth package worth about 31 billion euros

(41.13 billion U.S. dollars) is due to take effect in January. Yet it has been

criticized by experts as falling short to protect Germany from the global

recession.

During an interview with the German news magazine Der Spiegel, Paul

Krugman, a U.S. professor who accepted the Nobel prize in economics Wednesday,

said that Merkel and Steinbrueck "are misjudging the severity of the economic

crisis and wasting valuable time."