• Germany's news in English

Growth slumps in 2012 as Q4 economy shrinks

The Local · 15 Jan 2013, 10:25

Published: 15 Jan 2013 08:02 GMT+01:00
Updated: 15 Jan 2013 10:25 GMT+01:00

Facebook Twitter Google+ reddit

The federal statistics office Destatis estimated that gross domestic product (GDP) contracted 0.5 percent in the last three months of 2012, after expanding by 0.5 percent in the first quarter, 0.3 percent in the second quarter and 0.2 percent in the third quarter.

Destatis is not scheduled to publish more precise fourth-quarter GDP data until next month.

But at the authority's annual news conference to present its estimates for full-year growth figures, Destatis' top statistician Norbert Räth gave a rough indication with respect to the fourth quarter.

"The full-year growth figure (of 0.7 percent) implies a contraction of around half a percentage point in the fourth quarter," Räth said.

Despite the sharp slowdown in growth in the second half of last year, Destatis president Roderich Egeler pointed out that Germany was still faring much better than most of its European neighbours, many of which were in recession.

"Overall, the German economy proved itself to be very robust," Egeler said. "Despite the European economic crisis, GDP expanded by 0.7 percent, driven particularly by robust foreign trade as well as domestic consumption," Egeler said.

For the first time for five years, the overall state budget -- which covers both the German government, the regional and municipal authorities, as well as the social welfare administration -- showed a surplus of €2.2 billion ($2.9 billion), equivalent to 0.1 percent of GDP, Egeler added. In 2011, the overall state budget had shown a deficit ratio of 0.8 percent.

But the German government is reportedly expecting growth of only 0.5 percent this year, as the ongoing eurozone crisis drags on Europe's largest economy.

The business daily Handelsblatt reported on Tuesday that Berlin will slash its previous growth forecast in half in its annual economic report due out later this week.

However, government officials see light at the end of the tunnel, penciling in gross domestic product growth of 1.25 percent in the final quarter of 2013. And the German labour market is expected to remain largely unscathed by the economic slowdown this year.

Story continues below…

The prognosis assumes Europe’s sovereign debt crisis will continue to fester but not worsen dramatically, which would unsettle financial markets.

“The ongoing debt crisis in some eurozone countries still remains the biggest risk,” the paper quoted the report as saying.

The Local/AFP/DAPD/mry

The Local (news@thelocal.de)

Facebook Twitter Google+ reddit

Your comments about this article

10:35 January 15, 2013 by Dalmation
However, government officials see light at the end of the tunnel, penciling in gross domestic product growth of 1.25 percent in the final quarter of 2013. And the German labour market is expected to remain largely unscathed by the economic slowdown this year.

Pull the other one. After 4 or 5 quarters of shrinking economy we are supposed to believe it will end in the quarter that just happens to be the one the German state elections are held in. The German labour market got away with it somewhat primarily due to 400 Euro jobs and internships covering up the real story. If we all work for nothing we can pull the big German exporters out of the dung heap they landed us all in. Of course they don't mind leaving us in the dung heap. Thank you Angie and your banking buddies. May you rot in hell.
14:06 January 15, 2013 by smart2012
Verkel, here is the pay back to your poor strategy. Well done! Germans, wake up
Today's headlines
Outrage over ruling on 'brutal' gang rape of teen girl
The now convicted suspects, sitting in court in Hamburg. Photo: DPA.

A 14-year-old girl was gang-raped and left partially clothed and unconscious in freezing temperatures. Now prosecutors are appealing the sentences for the young men found guilty, most of whom will not set foot in jail.

Dozens of Turkish diplomats apply for asylum in Germany
Demonstrators holding a giant Turkish flag protest against the attempted coup in Istanbul in July. Photo: DPA.

Since the failed putsch attempt in Turkey in July, Germany has received 35 asylum applications from people with Turkish diplomatic passports, the Interior Ministry confirmed on Wednesday.

Hertha Berlin fan club criticised for 'anti-gay banner'
Hertha BSC beat FC Cologne 2-1. Photo: DPA

A 50 metre fan banner apparently mocking the idea of gay adoption has overshadowed Hertha BSC's win in the Bundesliga.

Germany stalls Chinese takeover of tech firm Aixtron
Aixtron headquarters in Herzogenrath. Photo: DPA

The German government on Monday said it had withdrawn approval for a Chinese firm to acquire Aixtron, a supplier to the semiconductor industry, amid growing unease over Chinese investment in German companies.

Politicians call for tough sentences for 'killer clowns'
File photo: DPA.

Now that the so-called 'killer clown' craze has spread from the US to Germany, elected officials are drawing a hard line against such "pranks", with some threatening offenders with jail time of up to a year.

Nearly one in ten Germans are severely disabled
Photo: DPA

New figures reveal that 9.3 percent of the German population last year were considered severely disabled.

The Local List
Germany's top 10 most surreal sites to visit
The Upside-Down House, in Mecklenburg–Western Pomerania. Photo: Olaf Meister / Wikimedia Commons

From upside-down houses on Baltic islands to a fairy-tale castle near the Austrian border, Germany is a treasure trove of the extraordinary.

Bavarian critics back Merkel for Chancellor again
Photo: DPA

The Christian Social Union (CSU) have long delayed backing Angela Merkel as their candidate for Chancellor in next year's general election. But now key leaders are supporting her publicly.

Four taken to hospital after hotel toilet bursts into flames
File photo: DPA.

Four guests at a Nuremberg hotel were taken to hospital due to smoke inhalation early Monday morning after a toilet there burst into flames.

Creepy clown scare spreads to Germany
Two of the clowns were apparently equipped with chainsaws. Photo: Pedro Pardo / AFP file picture

Police said Friday five incidents involving so-called scary clowns had occurred in two north German towns, including one assailant who hit a man with a baseball bat, amid fears that Halloween could spark a rash of similar attacks.

10 things you never knew about socialist East Germany
Sponsored Article
Last chance to vote absentee in the US elections
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
Eleven famous Germans with surnames that'll make your sides split
The best ways to get a visa as an American in Germany
jobs available
Toytown Germany
Germany's English-speaking crowd