Germany considers aid to Opel

Germany is considering a move to establish a line of credit for automaker Opel in spite of European Union concerns over protectionist economic policies.

Opel is expecting $3.3 billion from the German federal government and about $900 million from four German states where the company has a presence, the EU Observer reported Tuesday.

Without the aid, the carmaker could go bankrupt by May or June, German newspaper reports have said. If Opel folded, 25,000 jobs would be gone, the Observer said.

Germany’s finance minister Peer Steinbrueck said it would be more logical to provide aid to the company, which would keep jobs and tax revenues going, than it would be to relegate workers to unemployment benefits.

But, concern about protectionism is on the rise. Friday, the European Commission voiced concern over Italy’s aid for car, motorcycle and appliance producers. In Britain, France and Spain, other protectionist measures have been met with criticism.

Socialist Foreign Minister Frank-Walter Steinmeier on Saturday said Germany should seek international help.

We have to look further than our own backyard. No car factory is capable of surviving alone in Germany or elsewhere, he said.