Allianz predicts economic boom in 2010

Germany's insurance giant Allianz foresees a massive recovery for the country's economy this year, with growth exceeding official forecasts and unemployment rising only marginally, a report said Friday.

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The daily Bild quoted the group's chief economist Michael Heise as saying that growth would reach 2.8 percent, comfortably above the German central bank's prediction of 1.6 percent and the strongest since 2006.

Heise said the good performance would be spurred by a boom in exports, stable domestic consumption, government recovery programmes and tax cuts recently agreed by the ruling centre-right coalition.

He also forecast that 2010 would not see the widely feared mass lay-offs in industry, and unemployment would stay well below the symbolic four million level.

While many analysts have said this mark would be topped, with the Bundesbank predicting 4.2 million jobless by 2011, Heise said they would not exceed 3.67 million, some 240,000 more than at present.

"If, as is probable, the economy continues on the same path as in the past few months, it will have got over its crisis by the end of 2011, which is faster than thought," he said.