Open

Coming up

Don't miss

Replay


LATEST SHOWS

TALKING EUROPE

Nigel Farage, Leader of the UK Independence Party

Read more

TALKING EUROPE

Endocrine disruptors: Is the EU doing enough to protect its citizens' health?

Read more

WEB NEWS

Israelis taking bomb shelter selfies

Read more

THE INTERVIEW

Pavlo Klimkin, Ukrainian Foreign Minister

Read more

THE INTERVIEW

Raed Fahmi, former Iraqi Minister of Science and Technology

Read more

IN THE PAPERS

Germany's World Cup title

Read more

FASHION

Paris, Haute Couture Fall/Winter 2014-2015

Read more

BUSINESS DAILY

Farnborough air show takes off but F-35 jet is grounded

Read more

IN THE PAPERS

Bastille Day celebrations

Read more

  • Boules and booze: Bastille Day à la New Yorkaise

    Read more

  • In pictures: 2014 World Cup historic moments

    Read more

  • Kremlin mulls 'retaliatory strikes' after death of Russian civilian

    Read more

  • France commemorates WWI centenary on Bastille Day

    Read more

  • Paris’s Bastille Day fireworks ‘a homage to victims’ of WWI

    Read more

  • Shipwrecked Costa Concordia successfully refloated

    Read more

  • Germany defeat Argentina 1-0 to win fourth World Cup title

    Read more

  • Senegal honours the soldiers who fought for France in WWI

    Read more

  • Clashes erupt in Paris as thousands march to support Palestinians

    Read more

  • Thousands flee northern Gaza after Israeli warning

    Read more

  • Major differences remain as deadline looms in Iran nuclear talks

    Read more

  • Rival Libyan militias exchange heavy fire at Tripoli airport

    Read more

  • French military to extend Mali 'counterterrorism' operations into Sahel

    Read more

Business

Berlin forecasts worst recession in post-war history

©

Latest update : 2009-01-21

The German government forecast a 2.25% contraction in the economy this year as the global slowdown dents demand for German exports. Chancellor Angela Merkel's cabinet is working on a record €50bn package to boost public spending.

AFP - Berlin forecast on Wednesday that Germany will suffer its deepest post-war recession this year, as Chancellor Angela Merkel's cabinet chewed over a historic rescue package aimed at easing the pain.
  
Germany's economy, which accounts for about a third of eurozone output, will contract by around 2.25 percent in 2009, the government said, as the sharp global slowdown hits demand for the country's all-important exports.
  
"For this economic downturn that we are unfortunately having to predict is without precedent in the postwar period, it is the biggest slump in Germany's recent history," Economy Minister Michael Glos told a news conference.
  
"The German economy is facing this year the greatest challenges since unification (in 1990). Germany is integrated into the global economy like hardly any other industrialised country."
  
The new forecast came as Merkel's cabinet discussed on Wednesday Berlin's latest effort to help the world's biggest exporter avoid the worst: a 50-billion-euro (65-billion-dollar) stimulus effort.
  
The package, the biggest in modern German history, includes a huge increase in spending on roads, railways, hospitals and schools. Other elements include cuts in tax and social security contributions, as well as incentives for consumers to buy new "greener" cars to boost Germany's ailing auto sector.
  
Germany entered a recession in the third quarter of 2008 with two successive three-month periods of shrinking economic output.
  
Preliminary official figures last week showed that the slowdown accelerated sharply at the end of the year, contracting by between 1.5 and two percent -- the sharpest fall in two decades.
  
Merkel also plans to set up a 100-billion-euro fund to help out firms struggling to secure sufficient credit -- or at least loans without painful interest rates.
  
Hard-up banks are still proving reluctant to dole out cash despite Berlin's 480-billion-euro banking package rushed through last year, firms have complained.

Date created : 2009-01-21

Comments

COMMENT(S)