German Finance Minister and Vice Chancellor Olaf Scholz, the presumptive leader of the next government, presented an updated financial forecast Thursday indicating increased revenues for future government projects.

At a news conference in Berlin, Scholz said that despite the COVID-19 pandemic, the recent “fourth wave” of new infections and the worldwide supply chain problems, Germany’s tax revenue over the next few years would be higher than the estimates made in May.

Scholz said the new revenue forecast showed all levels of government collecting about $205 billion more in revenue through 2025 than the earlier prediction. He credited the higher-than-expected revenue to “a robust labor market.”

Scholz’s Social Democratic Party won the most seats in September’s parliamentary elections, but because it does not control more than 50% of parliament, it is in negotiations with the third- and fourth-place finishing parties, the environmentalist Greens and pro-business Free Democrats, to form a coalition government.

When asked how the power-sharing negotiations were going, Scholz said he was optimistic.

“I see very concrete things going on, and the observations I had are that a lot of things have come together. Everything still left to discuss is not so difficult that it cannot be overcome,” he said.

Scholz said this new forecast meant the next government could “work sensibly,” though he cautioned there were still financial burdens from the pandemic.

He identified investments in mitigating climate change and upgrading Germany’s public sector computer and internet infrastructure as two of his priorities.​

Some information for this report came from The Associated Press, Reuters and Agence France-Presse.
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