Germany's economy is recovering, but any tax rises or budget cuts would be counterproductive, Finance Minister Hans Eichel said on Wednesday. "The upswing thus is still fragile," he wrote in an op-ed piece for Handelsblatt newspaper. "Additional savings packages or even tax rises would be harmful for the economy and counterproductive; they would risk the economic recovery." Eichel dismissed criticism that Germany was selling off too many government assets. "Privatisation is part of a comprehensive modernisation of government." He did not comment on Tuesday's European court ruling that finance ministers acted illegally last November by voting to suspend disciplinary proceedings against Germany and France for running deficits over the bloc's three percent of GDP limit.
Eichel presented a draft 2005 budget last month that is supposed to bring the country back in line with EU budget rules. The draft, due to be adopted by parliament in the autumn, foresees spending of 258.3 billion euros, slightly more than in 2004, and tax revenues of 194.5 billion euros. Alongside borrowing, the budget foresees "other revenues" totalling 41.8 billion euros, of which some 15.45 billion euros is due to come from the sale of state assets like shares in Deutsche Telekom AG and Deutsche Post AG .///