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Saturday 16th of May 2009
May 15, 2009

German economy suffers steep decline


by Kay Murchie
”German

The Federal Statistics Office has reported that Gross Domestic Product (GDP) in Germany’s economy fell 3.8% in the first three months of 2009, compared with the previous quarter when GDP fell 2.2%. On an annual basis, the economy shrank by 6.7%.

The fall in GDP for the first three months of the year is the largest contraction since the reunification in 1990. Meanwhile, the fourth quarter figures were the worst on record.

The German Government is forecasting that the economy will contract by 6% this year.

The falls were primarily due to the fall in exports being markedly larger than that of imports, according to the Statistics Office.

The German economy, which is Europe’s largest, is experiencing its deepest recession since 1949. The country is the world’s largest exporter and many reports have suggested that the country’s exports are in ‘freefall’.

In the meantime, France fared slightly better than its neighbour with its economy contracting 1.2% in the first three months - as expected.

France’s statistics office, Insee, said the fall was less than the 1.5% fall reported in the fourth quarter of 2008.

The Economy Ministry is forecasting that France’s economy will contract by 3% this year.

Yesterday, it was reported that Spain’s economy had suffered its steepest fall since 1959.

According to the National Statistics Institute, which is set to release final statistics next week, Spain’s GDP fell 1.8% compared with the previous quarter and is down 2.9% on an annualised basis.

The Spanish Government has forecasted GDP will contract by 1.6% in 2009.

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