Much of the world has been feeling the uncomfortable downward pull of a declining economy. Some countries have suffered more than others. In comparison to other economies, Germany – the largest economy within Europe – has emerged unscathed and resilient as it continues to improve even as others decline. Predictions show that their financial condition is expected to carry on strongly throughout the upcoming year.
Germany’s economy did experience a “mild” economic decline in 2010. However, this temporary dip was mostly due to the abnormally cold and snowy weather the country experienced that season. Bad weather hindered a great deal of progress in construction and transportation, stunting profit. By this point, Germany’s economy has rebounded and recovered.
The Kiel Institute stated that the European countries will suffer from a decrease in important foreign trade. This delivers a significant blow to the economies of countries that depend heavily on foreign export. However, Kiel reported that Germany will not suffer the same fate. While economists predict a recession for the rest of Europe, Germany’s stats lead economists to believe that this country will manage to escape those consequences.
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Over the last year, private consumption sped up to the greatest rate the economy has experienced within the last year and a half. This helped offset any negative dips the country’s economic activities may have taken. Also contributing to Germany’s resilience and increased consumption during these times was the decrease of joblessness that helped create cash flow.
Almost half a million job opportunities were predicted to become available in 2011. This is a considerable factor in the country’s economic resilience, creating output and encouraging cash flow. As a matter of fact, German unemployment is at the lowest it has been in about 20 years. And economists only expect the numbers to continue to improve. By the end of the year it is expected that unemployment will decrease by 295,000 with another decrease of 260,000 next year.
In addition to an increase in employment, German business confidence also rose, contributing to economic movement. Even industrial production grew more than economists forecasted. The numbers show that Germany’s economy marched along at a strong pace this year with an output growth of 1.9%. A solid external demand, growth in employment, and positive financing conditions continue to contribute to a growing GDP. Within 2011 this number increased by 3.3%.
Germany continues to hold a firm position as the largest economy among all European countries. Reports from 2011 and forecasts for 2012 show that the country’s economy will continue enjoy stable footing even as others around it falter. Although growth is predicted to slow down a bit within the next year, economists believe it will soon pick up again the following year in 2013.
