Editions:  Austria · Denmark · France · Germany · Italy · Norway · Spain · Sweden · Switzerland

German 'wise men' slash growth forecast

Share this article

German 'wise men' slash growth forecast
Photo: DPA
11:56 CET+01:00
An influential panel of top economic advisors to the German government this week downgraded its 2013 growth forecast for the country, saying Europe's top economy would only expand 0.3 percent.

Last November the panel, known as Germany's "Five Wise Men", had predicted an already very sluggish growth rate of 0.8 percent for this year and next, and blamed a recent downturn and shrinking demand from abroad.

"The decline of 0.5 percentage points compared to the forecast in November 2012 is a result above all of the significant decline in the gross national product in the fourth quarter of 2012," the group said in a statement. "Drivers of growth in 2013 are only expected from inside the country."

The German government has predicted 0.4 percent growth this year after slowing down to 0.7 percent in 2012.

The advisors said that a healthy job market would continue to lead to "robust development" of private household consumption but that investment by industry would be slack at least in the first half.

It held to its previous forecast that average annual unemployment would rise slightly to 6.9 percent.

Meanwhile exports, the traditional motor of the German economy, will dip on average over the course of 2013, weighed down by the crippling eurozone debt crisis and recession in its most important export market, the European Union.

Unlike most of its neighbours, Germany has been spared the worst of the long-running debt crisis thanks to deep and painful structural reforms implemented over the last decade.

It clocked up growth of 4.2 percent in 2010 and 3.0 percent in 2011.

AFP/mry

Europe's Leading Job Site for
International Talent - The Local Jobs
Get notified about breaking news on The Local

Share this article

The Local is not responsible for content posted by users.
Become a Member or sign-in to leave a comment.

From our sponsors

QUIZ: Which influential Icelander are you?

Iceland may have a population of just over 330,000 people (all with equally unpronounceable names) but that doesn't stop it churning out a stream of globally-renowned people. Take our quiz to discover your Icelandic spirit animal.