fact finder
315 million euros: That’s how much Germany apparently spends on cycle paths and buses in Peru. At least that’s what was claimed on social networks and by politicians. But the number cannot be understood.
The Bavarian Deputy Prime Minister writes that the traffic light government could have satisfied the farmers with the money for the cycle paths in Peru Hubert Aiwanger on Platform X. CSU General Secretary Martin Huber also criticizes: “The traffic light distributes money all over the world, but supposedly there is no money for our hard-working farmers?”
The reason for the excitement is German development aid. In his post on Platform He did not mention that the projects listed were approved by the CSU under Federal Development Minister Gerd Müller before December 2021.
Development aid for Peru in particular has caused a lot of excitement in recent weeks. There was repeated talk of 315 million euros that Germany would use to finance cycle paths and buses there. But what does it mean?
Where the alleged 315 million euros come from
AfD MP Michael Espendiller mentioned the 315 million euros for the first time at a meeting of the budget committee on November 21st with a question for an expert. Focus reported on it and quoted Espendiller.
A day later, Bundestag member Joana Cotar posted the number on X. Cotar has been non-attached since November 2021; she was previously part of the AfD parliamentary group. During a speech in the German Bundestag, Cotar reiterated the “315 million euros for cycle paths and buses in Peru”. Upon request from tagesschau.de Cotar said that the number came up for the first time in the Budget Committee and that Focus then picked it up. The sum was in circulation at the latest after Cotar’s speech in the Bundestag on December 1st.
According to the BMZ, the number is “not correct”
It is true that Germany financially supports numerous projects around the world every year. The Federal Ministry for Economic Cooperation and Development (BMZ) is primarily responsible for this. A spokeswoman said at the request of tageschau.de with: “The BMZ cannot understand how the figure of 315 million euros came about. In our view, it is not correct.”
The Federal Ministry is supporting with a grant of EUR 2020, which was promised in 2020 20 million euros to build a bicycle superhighway network in Lima. It is currently under construction, it said. In 2022, the ministry pledged a further 24 million euros for the construction of cycle paths in Peru, which are currently in the planning phase.
Peru is in favor of an environmentally friendly bus system in 2015 around 55 million euros as a loan been made available. According to the ministry, a further loan of a good 100 million euros has been promised in 2022. With the commitments from 2022 and the ongoing projects, the subsidy for cycle routes and the loan for the environmentally friendly bus system, Germany is financing cycle paths and a bus system in Peru with around 199 million euros.
Part of the money will be paid back
According to the BMZ, the first project for the cycle highways in Lima from 2020 involved a grant of 20 million euros. So this money will not be paid back. However, the funding of 55 million euros for the environmentally friendly bus system in Peru will be repaid because it is a loan. “The loan term is usually ten to 15 years, in exceptional cases up to 20 years,” says the KfW Development Bank.
Development Assistance also financed by loans
The federal government made the commitments from 2022 from the SPD, FDP and Greens. That year, Germany concluded a “climate and development partnership” with Peru and said a total of 529 million euros to. According to the federal government, the money contributes to promoting “forest protection and biodiversity, climate protection and adaptation to climate change, sustainable urban development and good government support”. “In view of Peru’s economic performance, the commitments are predominantly low-interest loans,” said the BMZ about the climate and development partnership with Peru.
The 529 million euros are a commitment over several years, says Stephan Klingebiel, head of the “Inter- and Transnational Cooperation” research program at the German Institute of Development and Sustainability (IDOS). The funds will be used for projects in three focus areas – sustainable urban development is one sub-area.
Part of German development aid is financed through loans. The projects are financed by the KfW Development Bank – in three different ways. If a country receives a grant, the funds come from the budget; these grants are not repaid. A development loan is a mixed form of funds from the budget and market funds. This money will be paid back.
In the third form, a promotional loan, no funds from the federal budget are used, but only funds that the KfW Development Bank raises on the capital market. This means that this money will also be paid back. “It doesn’t cost the German taxpayer anything,” says Klingebiel.
Climate protection as a reason for funding
Germany supports, among other things, climate protection and energy projects in Peru. In Peru, 200,000 new cars are registered every year; according to the Kreditanstalt für Wiederaufbau (KfW), 40 percent of the country’s CO2 emissions come from the transport sector.
A spokeswoman for the BMZ said: “Cycle superhighways in one of the largest and rapidly growing cities in South America create multiple benefits: They ensure mobility for all parts of the population at affordable prices, thus also enabling the poor to participate more in social and economic life protect the climate.”
That’s how much Germany gives for Development Assistance out of
Overall, Germany spends around 0.7 percent of gross national income on so-called public development benefits (ODA for short). The 32 donor countries of the Organization for Economic Cooperation and Development (OECD) agreed on this goal based on United Nations agreements from 1972. In 2022, total German development expenditure amounted to 33.9 billion euros.
Not all of this goes to the BMZ – in 2022 it was 13.35 billion euros. The second largest pot for German development aid lies with the Foreign Office.
The care and accommodation of refugees from developing countries in Germany is also taken into account in the development services – the OECD also includes Ukraine as a developing country. According to the BMZ, that was 4.6 billion euros in 2022. This corresponds to 13.6 percent of German development output.
In addition to the benefits for refugees, funds for students who come from developing countries and study in Germany can also be billed at a flat rate.