BERLIN – Germany is raising its economic growth forecast for the year on the expectation of the gradual lifting of coronavirus restrictions and an anticipated rise in domestic spending, the economy minister said Tuesday.
Peter Altmaier said gross domestic product is expected to increase 3.5% in 2021 now, up from a previous forecast of 3%, and that it should grow 3.6% in 2022.
He said that the government's “comprehensive and quick support” for businesses had paved the way for a return to pre-pandemic levels by next year for Europe's largest economy.
“Our economy is strong, robust and ready for a new start,” he said.
Last year, Germany’s gross domestic product shrank by 4.9%. That ended a decade of growth and was the biggest decline since the financial crisis in 2009.
It did better than several others in the 19-country eurozone, however, as it was supported by manufacturing, which has taken less of a hit than services during the pandemic.
The government prognosis is more optimistic than a forecast last month from its panel of independent economic advisers, which predicted 3.1% growth in 2021.
On the other hand, a group of leading German economic institutes two weeks ago forecast 3.7% growth in 2021.