As if Germany wasn’t doing enough to make half the world look bad, it’s strong recovery since the crisis is set to continue according to a fresh report from economic institutes in Germany, Austria, and Switzerland according to Der Spiegel.
‘The success of Germany’s economy cannot be belittled,’ chimes in the Handelsblatt.
It’s not just about German exports being cost-competitive within Europe thanks to the euro, or even exports at all.
Domestic German demand is also gaining steam and Germany looks set for a sustained recovery they say:
The numbers, certainly, are rosy. The report, which is issued twice a year, once in the spring and again in the autumn, predicts that the German economy will grow by 3.5 per cent in 2010 and a further 2.0 per cent next year. Furthermore, unemployment is expected to drop below 3 million next year for the first time since reunification two decades ago. And to top off the slew of positive numbers, the DAX, Germany’s stock exchange index, topped 6,400 on Wednesday, reaching a level not seen since just days before the collapse of the US investment bank Lehman Brothers.
According to the report, domestic demand has begun to pick up and, even as export growth is expected to slow due to a sluggish global economy, German wages are forecast to rise by up to 2.8 per cent in 2011. The economic experts who authored the report anticipate that domestic consumption will continue to be strong next year as a result. The report also indicated that climbing tax revenues will result in a 2011 budget deficit of just 2.7 per cent, below the 3.0 per cent maximum allowed by European Union rules.
Sustained growth, rapidly falling unemployment, and a controlled budget deficit — heaven, basically.
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