'Don't get cocky,' IMF head warns Germany
Published on: 01 Oct 2010 15:24 CET
“I think it would be a bit early to talk of a ‘wonder,’” the French economist told business daily Handelsblatt. “The second quarter was indeed very good. But we don’t yet know whether that is the beginning of a new growth model for Germany – which I doubt – or just a kind of ‘calendar effect.’
“As soon as the figures for the next quarter are known, that’ll be more clear. But certainly 2010 is becoming a good year. Only we don’t even have much reason to expect that 2011 will be just as good.
Germany must keep in mind that three quarters of its exports went to the eurozone, he said.
“And we have a weak eurozone, thus you cannot export more,” he added.
Talk for most of this year has revolved around the perceived wonder of Germany’s strong economic recovery after the financial crisis and the global recession. While most comparable countries are still struggling, Germany has bounced back well.
This week, figures showed that German consumer and business confidence were at three-year highs, prompting Chancellor Angela Merkel to forecast that unemployment could fall below the all-important psychological barrier of three million soon.
Germany's economy posted strong growth in the first half of 2010, and while the pace has eased since then, is still on track for a full-year expansion of around 3.0 percent, economists and the central bank have said.