German Vice Chancellor, Robert Habeck has cancelled a trip to the UN Climate Change Conference in Dubai owing to the budget crisis in the country.
The move came after a landmark court decision earlier this month that affected the government’s spending plans.
According to a spokeswoman for the Economy Ministry, Habeck’s presence in Berlin is important in order to make further progress in the talks on the 2024 budget.
She added that the cancellation was done in consultation with and at the request of Chancellor Olaf Scholz.
Habeck was due to participate in the COP28 climate conference in Dubai this week.
A recent decision by Germany’s Constitutional Court nullified plans to reallocate 60 billion Euros (65 billion dollars) borrowed during the Coronavirus pandemic for climate projects.
The fallout from the decision has created a major budget crisis for Scholz’s three-party coalition government.
Negotiations on the budget are currently happening primarily in a three-way round with Scholz, Habeck and Finance Minister Christian Lindner.
The coalition must agree within the next few days if it wants to adopt the budget for 2024 before the year ends.
A political agreement in principle must be reached by the Cabinet meeting on Wednesday so that there is still enough time for the parliamentary process.
Habeck told Germany’s ARD television station earlier that there was progress in the negotiations.
He said: “I am very optimistic that we are well on the way to reaching an agreement.”
When asked if this meant that he wasn’t sure that the coalition would reach an agreement, Habeck said: “I can’t speak for everyone. But I repeat that I believe we are making good progress.
“It is a process that is arduous, one can see that, but it is making progress.”