• Germany's news in English

German economy surprises with robust Q1 growth

The Local · 15 May 2008, 08:59

Published: 15 May 2008 08:59 GMT+02:00

Facebook Twitter Google+ reddit

“The economic upswing of last year has continued unabated,” the Statistics Office said in a statement, adding that the world’s third largest economy had proven itself “very robust” despite the strong euro dragging on exports and oil prices at record highs.

Economists polled by Thomson Financial News had expected gross domestic product (GDP) in Europe's largest economy to have expanded by only 0.7 percent. In the fourth quarter it grew 0.3 percent.

Data since the beginning of the year have suggested that the German economy was holding up surprisingly well despite the strength of the euro, rising energy and food prices, the credit crunch and a slowing of the US economy.

Industrial output, for example, grew 2.3 percent in the first quarter, data showed earlier this month, while exports - the motor of the German economy - were up 2.4 percent.

"The result shows that Germany - with painful reforms in previous years - has become stronger and more resilient to external shocks than before," Bank of America economist Holger Schmieding said.

"For an economy that we had described as the 'sick man of Europe' until it started to get its act together again with the Hartz I-IV and other structural reforms five years ago, this is quite an achievement," Schmieding said.

The contrast with other euro zone countries could not be starker. First quarter from the EU's Eurostat data agency showed Thursday showed that the French economy grew by a mere 0.6 percent and Spain's just 0.3 percent.

Germans cannot afford to be too smug, however, with the latest data and sentiment indicators suggesting that Germany cannot escape the global headwinds howling around the global economy for much longer.

Story continues below…

German industrial output and exports fell in March, for instance, and the last reading of the closely watched Ifo sentiment index showed a steeper-than-expected decline. The Economy Ministry expects growth for the whole of 2008 of 1.2 percent, while the country's six leading economic institutes expect 1.4 percent.


The Local (news@thelocal.de)

Facebook Twitter Google+ reddit

Today's headlines
These are Germany's top ten universities
The new library of Freiburg University. Photo: Jörgens.mi / Wikimedia Commons

These are the best universities in all of Germany - at least according to one ranking.

Introducing Swabians - 'the Scots of Germany'
Photo: DPA

These Southern Germans have quite a reputation in the rest of the country.

Woman sues dentist over job rejection for headscarf
Photo: DPA

A dentist in Stuttgart is being taken to court by a woman whom he rejected for a job as his assistant on the basis that she wears a Muslim headscarf.

Isis suspect charged with scouting Berlin attack sites
Photo: DPA

German federal prosecutors said Thursday they had brought charges against a 19-year-old Syrian man accused of having scouted targets in Berlin for a potential attack by the Isis terror group.

Berlin Holocaust memorial could not be built now: creator
The Memorial to the Murdered Jews of Europe, in Berlin. Photo: DPA.

The architect of the Berlin Holocaust memorial has said that, if he tried to build the monument again today, it would not be possible due to rising xenophobia and anti-Semitism in Germany and the United States.

'Liberal' Germany stopping Europe's 'slide into barbarism'
Ian Kershaw. Photo: DPA

Europe is not slipping into the same dark tunnel of hate and nationalism that it did in the 1930s - mainly thanks to Germany - one of the continent's leading historians has said.

Eurowings strike to hit 40,000 passengers
Travelers impacted by the strike on Thursday wait at Cologne Bonn airport. Photo: DPA.

The day-long strike by a Eurowings cabin crew union is expected to impact some 40,000 passengers on Thursday as hundreds of flights have been cancelled.

Deutsche Bank reports surprise quarter billion profit
Photo: DPA

Troubled German lender Deutsche Bank reported Thursday a surprise €256-million profit in the third quarter, compared with a loss of more than six billion in the same period last year.

US 'warned Merkel' against Chinese takeover of tech firm
Aixtron HQ. Photo: DPA

The German government withdrew its approval for a Chinese firm to purchase Aixtron, which makes semiconductor equipment, after the US secret services raised security concerns, a German media report said Wednesday.

Long-vanished German car brand joins electric race
Photo: DPA

Cars bearing the stamp of once-defunct manufacturer Borgward will once again roll off an assembly line in north Germany from 2018, the firm said Wednesday.

10 German clichés that foreigners get very wrong
Sponsored Article
Last chance to vote absentee in the US elections
10 ways German completely messes up your English
Germany's 10 most weird and wonderful landmarks
10 things you never knew about socialist East Germany
How Germans fell in love with America's favourite squash
How I ditched London for Berlin and became a published author
12 clever German idioms that'll make you sound like a pro
23 fascinating facts you never knew about Berlin
9 unmissable events to check out in Germany this October
10 things you never knew about German reunification
10 things you're sure to notice after an Oktoberfest visit
Germany's 10 most Instagram-able places
15 pics that prove Germany is absolutely enchanting in autumn
10 German films you have to watch before you die
6 things about Munich that’ll stay with you forever
10 pieces of German slang you'll never learn in class
Ouch! Naked swimmer hospitalized after angler hooks his penis
Six reasons why Berlin is now known as 'the failed city'
15 tell-tale signs you’ll never quite master German
7 American habits that make Germans very, very uncomfortable
Story of a fugitive cow who outwitted police for weeks before capture
jobs available
Toytown Germany
Germany's English-speaking crowd