The German economy is performing exceptionally well with very exciting economic news in recent months. There are strong indications that the country is moving more and more centre stage as the main driver and, increasingly, perhaps the saviour of the Euro economy.
Germany is the world’s second largest exporter and its third largest economy, driven by a population of over 82m people. Recent economic news points to excellent economic fundamentals - which is more than can be said for a lot of European economies.
GDP growth of c 3.5% in 2010 was exceptionally positive , and the official forecast for 2011 was recently increased form 2.3% to 2.6% on the back of excellent data elsewhere.
German exports experienced their fastest growth rate in two decades during 2010 , with German trade surplus of €60.2 billion from Jan-May 2010. Compare this to the other 'powerhouses' of the European economy -France (-€20billion) and UK (-€40billion).
Business confidence measured by the German IFO index has climbed continuously over the past year from 95.9 in Jan 2010 to 110.3 in Jan 2011, another all time high in the 20 year period since re-unification. “The German economy has started the year with great vigour” (H-W Sinn , President IFO Institute Munich , 01/2011).
The German unemployment rate has fallen to 7.5% from 8.2% in 2009. This rate is forecast to drop further in 2011 to 7% with 300,000 new jobs anticipated. The number of Germans at work in 2012 is expected to reach an all-time high of 41 million . In the former East German states, including Saxony, unemployment is at the lowest rate since 1991. Germany is one of the few countries where unemployment in now lower than before the 2008-2009 financial crisis.
The German budget deficit is in control unlike other leading economies. The deficit is now forecast at 3.7% for 2010 reducing to 2.4% in 2011, well within the 3% EU target. The key German Markit purchasing managers survey shows that both services and manufacturing are performing strongly with the index at 61.0 , the 2nd highest reading on record “yet another signal that Germany’s economy is pulling away from most of its Eurozone competitors” (Irish Times 24/01/11).
“There are encouraging signs that domestic demand is beginning to emerge as a source of additional growth in the German economy.” ( Equinet Bank , Frankfurt 10/01/2011)
So where can you get a bit of Germany? We'll be posting here with some info in the near future.