German economy continues to drive euro zone recovery

| April 14, 2011 | 0 Comments
German economy continues to drive euro zone recovery

Germany’s Economy Minister Rainer Bruederle has today said the economy will perform better than expected in 2011.

According to the minister, the economy is predicted to grow by 2.6% this year - better than a previous estimate of 2.3% in January.

However, growth will ease slightly in 2012, slowing to 1.8%, said Mr Bruederle.

The growth forecast comes shortly after the country’s leading economic institutes said the country will expand by 2.8% this year - revised upwards from an earlier forecast of 2% growth.

Germany, which is Europe’s largest economy, emerged from recession in the second quarter of 2009 – much sooner than many of its counterparts throughout the world.

The economy posted growth of 3.6% in 2010 – the strongest pace since reunification in 1990, according to the Federal Statistical Office.

Meanwhile, the country’s unemployment rate continues to fall and its job market has performed much better than in many other countries and many believe it is the result of the “Kurzarbeit” scheme, introduced by the German Government, designed to prevent mass redundancies.

Last year, Germany’s unemployment rate plunged to 7.7% from 8.2% in 2009 as a result of the Government initiative.

In related news, France’s Economy Minister Christine Lagarde today said the economy will expand 2.25% in 2012, revised down from a previous estimate of 2.5%.

The revision was based on the fact that global demand for French goods is likely to weaken.

France is the euro zone’s second largest economy.

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