German Chancellor Merkel says open to scrapping zero-deficit rule to fight #coronavirus

German Chancellor Angela Merkel today outlined the country's strategy as “ensuring that the virus spreads slowly so as not to overwhelm the health system." "All of our measures are of the greatest importance because they give us time,”

“We are not doing things for nothing, our recommendations are always based on considerations of how not to overwhelm our health system."

In Germany, close to 1,300 cases have so far been confirmed with the west and south of the country hardest hit.

But so far the rate of fatality has been low in comparison with European neighbours, with just two confirmed deaths.

Merkel said that she had agreed on several steps with other EU leaders during a video conference on Tuesday night, including loosening EU stability and growth rules and establishing a "corona response investment initiative" equipped with €25 billion in investment funds.

On Wednesday, Merkel signalled that she does not rule out suspending a self-imposed dogma of keeping Germany’s budget balanced in the fight against the coronavirus outbreak. According to an AFP reports.

“It is an extraordinary situation, we will do what’s necessary and luckily Germany is relatively robust… we see at the end of that where our budget stands,” she said, stressing that ending the virus crisis “comes first”.

Maintaining a balanced or "black zero" budget has been a key campaign selling point of Merkel's government, which believes that it would be irresponsible for the fast ageing nation to incur more debt that would be left to a shrinking workforce to service.

But with the coronavirus outbreak forcing some countries to shut borders, companies to keep workforces home and as foreign orders collapse, calls have grown for Merkel's government to help prop up Germany's economy.

"An economy like Germany's, which is extremely export dependent, is of course harder hit by global challenges than one that is very concentrated on" its domestic demand, acknowledged Merkel, saying that the government will announce liquidity help for firms.

Underlining the need to throw all resources at stemming contagion, the German chancellor also said Berlin will look the other way if severely hit countries like Italy were to flout the EU's rules on limiting public deficit as it fights the virus.

"On the European level regarding the stability and growth pact, we will be flexible. That was an important conclusion yesterday."

German Chancellor said up to 70% of the population is likely to be infected with the coronavirus, adding that since there was currently no cure the focus had to be on slowing its spread.

"When the virus is out there, the population has no immunity and no therapy exists, then 60 to 70% of the population will be infected," she told a news conference in Berlin.

"The process has to be focused on not overburdening the health system by slowing the virus's spread.

"It's about winning time."