German economy rebounds as Europe struggles
13 Jan 2011
The German economy rebounded last year and grew at its fastest pace since reunification two decades ago, from post-war low in 2009, even as other countries in Europe like Portugal, Ireland and Greece struggle with debts.
Germany, Europe's biggest economy, grew last year by 3.6 per cent, compared to a contraction of 4.9 per cent in 2009- its worst performance since World War II, the federal statistical office in Wiesbaden said yesterday.
The country's economy minister, Rainer Brüderle, who had forecast 2010 growth at 3.4 per cent, said that the German economy had grown twice as fast as the average across the region, "We grew twice as fast as the European Union average and people are rightly looking optimistically into the future."
The key to Germany's growth last year was the rebound of its exports, which increased by 14.2 per cent in 2010 after a decrease of 14.3 per cent in 2009. Germany is the world's second biggest exporter after China.
However, it was not only exports that made the German economy come on tracks, it was also the spur in domestic demand that coupled with foreign trade made the German economy grow at its fastest pace last year since reunification two decades ago.
Domestic demand was the main contributor to the country's GDP growth, which added 2.5 percentage points as household spending rose 0.5 per cent, up from a 0.2 per cent decline in 2009.
