Energy crisis triggers financial emergency in Germany's most populous state

North Rhine-Westphalia, Germany’s most populous state, has declared a financial emergency for this year and the next due to the burgeoning energy crisis.

The step was necessary for the state government – a coalition of the Christian Democrat Union and the Greens – to circumvent a law to acquire more loans.

The state will have to take new loans worth €5 billion ($5.18 billion) to address what the government has termed an “exceptional emergency,” according to public broadcaster WDR.

The funds will used for a rescue package for North Rhine-Westphalia, which is home to a particularly large number of energy-intensive industries.

Only two other German states, Bremen and Mecklenburg-Western Pomerania, have so far taken a similar step.

The North Rhine-Westphalia government originally wanted to use money left over in the COVID-19 bailout fund, but the plan was deemed unconstitutional by the state’s audit office.