• Germany edition
 
Germany slashes 2013 growth forecast to 0.4 pct
Photo: DPA

Germany slashes 2013 growth forecast to 0.4 pct

Published: 16 Jan 2013 12:37 GMT+01:00
Updated: 16 Jan 2013 12:37 GMT+01:00

Europe's powerhouse economy should expand by 0.4 percent in 2013, Economy

Minister Philipp Rösler said, a sharp downwards revision from a previous forecast of 1.0 percent. In 2014, growth should be 1.6 percent, he said.

"There is every reason for confidence," Rösler said in a statement as he presented the government's annual economic report.

"We believe that the weak phase this winter will be overcome in the rest of the year and that our economy will get back into gear," added the minister.

Germany has until recently fared better than most of its debt-stricken eurozone partners in the crisis but the economy began to slow sharply at the end of last year.

Data published on Tuesday showed Germany's powerhouse economy grew by a mere 0.7 percent in 2012 after a stellar 2011 when GDP expanded by 3.0 percent. And the economy seemed to have slammed abruptly into reverse in the fourth quarter of the year, as officials estimate a contraction of 0.5 percent.

Germany has been hit not only by the woes of its eurozone trading partners but also by a slowing global economy that has reduced demand for its all-important exports.

Nevertheless, unemployment remains at low levels for the moment, although analysts have warned that this too cannot last forever.

Rösler himself said there would be around 60,000 more people unemployed in 2013 than in 2012 but said this period of weakness would be "temporary."

"In the course of 2013, growth should noticeably pick up. It will be driven primarily by domestic demand," he added.

Germany would achieve its goal of registering a structurally balanced budget in 2014, Rösler said.

AFP/mry

The Local (news@thelocal.de)

Your comments about this article

15:07 January 16, 2013 by Berlin fuer alles
If the government can't bury this in election year what is the real story? Oh Angie, what have you done? Idiot.
17:31 January 16, 2013 by smart2012
Germany was "booming"n long long time ago. Finally BILD will not be able to hide it. Where did the "stand alone" strategy bring to? Well done Verkel, and Buba, and Bild! this is the pay back
18:42 January 16, 2013 by Tonne
So growth, driven primarily by domestic demand, will pick up in 2013 but unemployment will be higher in 2013.

Does this mean that wages will increase substantially in 2013, in the face of higher unemployment, or does Roesler have a new economic theory to explain his logic?
20:22 January 16, 2013 by Dalmation
@ Tonne

No, Roesler is only trying to persuade us the ship isn't sunk yet and hopes we won't realise we are neck deep in it until after the elections in Q3.
Today's headlines
Opinion
Do German unions have too much power?
Lufthansa passengers rush to change their flights at Frankfurt Airport on Monday. Photo: DPA

Do German unions have too much power?

Germany's pilots and train drivers are taking it in turns to bring the country to a standstill with strikes that have cost the economy tens of millions of euros in the last two weeks. Are unions abusing their power or standing up for their rights? READ  

Older workers can have extra days off, court says
Photo: Workers in a German shoe factory. Photo: DPA

Older workers can have extra days off, court says

Older workers in Germany are allowed more time off than younger ones, a court ruled on Tuesday, saying the difference was not discriminatory. READ  

Expat's family battles for answers four years on
Matthew Fitzpatrick died in 2010 in Mannheim. Photo: Fitzpatrick family

Expat's family battles for answers four years on

In 2010 an Irish computer engineer was found dead in his apartment in Baden-Württemberg. Four years on, his family are still pressing the German justice system for answers. They feel badly let down by police who they say have refused to examine evidence of foul play. READ  

Court: Germany can keep arms deals secret
The judges of the Supreme Court announce their decision about weapons exports on Tuesday. Photo: DPA

Court: Germany can keep arms deals secret

The government can keep arms deals secret and only tell the public about them after contracts have been signed, the Supreme Court ruled on Tuesday. READ  

Tourist finds €7,500 instead of cheesecake

Tourist finds €7,500 instead of cheesecake

Just how honest would you have to be to return €7,500 that you found in a box supposed to contain your favourite cheesecake? READ  

Tanker fills up gas station with wrong fuel
Photo: DPA

Tanker fills up gas station with wrong fuel

Around 160 car owners are stuck after a gas station's storage tanks were filled with the wrong fuel, causing an estimated €100,000 in damage. READ  

Lufthansa strike hits 1,500 flights
Photo: DPA

Lufthansa strike hits 1,500 flights

UPDATE: In the second day of their strike, Lufthansa pilots have, as promised, extended their industrial action to include long-haul international flights until the end of Tuesday. READ  

Merkel tells allies to pay Ukraine's gas debts
Chancellor Angela Merkel in Bratislava, Slovakia, on Monday. Photo: DPA

Merkel tells allies to pay Ukraine's gas debts

Chancellor Angela Merkel on Monday called on Ukraine's allies to help the war-scarred nation pay off its gas debts to Russia, amid concern over gas supplies this winter. READ  

Steinmeier wants epidemic task force
Frank-Walter Steinmeier speaks at the World Health Summit in Berlin. Photo: DPA

Steinmeier wants epidemic task force

At the World Health Summit in Berlin, the Ebola crisis took centre stage at talks meant to create plans for how to handle future outbreaks. READ  

Nazi-stolen painting put on display, sort of
The Wiesbaden Museum in Hesse. Photo: DPA

Nazi-stolen painting put on display, sort of

The Wiesbaden Museum was once a collection house for art stolen from Jewish owners by the Nazi. With one painting, they hope to right at least one wrong while bringing awareness to its ongoing restitution work. READ  

RECEIVE OUR NEWSLETTER AND ALERTS
Photo: Mariana Schroeder
Munich
Special Report: Hope and chaos at Munich's refugee shelters
Photo: DPA
Berlin
Robbers blow up Berlin bank
Photo: DPA
Culture
Can you top our history quiz leaderboard?
Photo: Facebook
Society
German motorcycle gang joins Isis fight
Photo: DPA
Politics
UKIP ‘seeks EU pact’ with German satirical party
Photo: DPA
Gallery
PHOTOS: World's biggest erotic fair opens in Berlin
Photo: DPA/Shutterstock
Gallery
11 things Germans are afraid of...
Sponsored Article
International School on the Rhine: a legacy
Photo: DPA
Gallery
The ten richest people in Germany
Photo: DPA
Business & Money
JobTalk: All you need to know about working in Germany
National
Share news tips with The Local Germany
Sponsored Article
Bilingual education from nursery to graduation at Phorms
Latest news from The Local in Austria

More news from Austria at thelocal.at

Latest news from The Local in Switzerland

More news from Switzerland at thelocal.ch

Latest news from The Local in Denmark

More news from Denmark at thelocal.dk

Latest news from The Local in Spain

More news from Spain at thelocal.es

Latest news from The Local in France

More news from France at thelocal.fr

Latest news from The Local in Italy

More news from Italy at thelocal.it

Latest news from The Local in Norway

More news from Norway at thelocal.no

Latest news from The Local in Sweden

More news from Sweden at thelocal.se

3,471
jobs available
Toytown Germany
Germany's English-speaking crowd