BERLIN (MNI) – The German economy is proving to be “robust and
resistant” despite a difficult global economic environment, the German
Economics Ministry said in its monthly report released Tuesday.
Current indicators signal that economic developments will continue
to be “quite stable” in the second half of the year, it said. Job
growth, though slowing, will continue to support private consumption,
the ministry said.
The report warned, however, that the downside risks for the
economy caused by the Eurozone debt crisis still outweighed the upside
risks and remained significant. The German economy is not unaffected
by the marked recession in the southern European states, it said.
The Eurozone crisis can only be overcome by credible reform
policies, the ministry said, and the bond-buying plan announced by the
European Central Bank can only be a temporary remedy. “Permanent
interest-rate subsidies for individual countries would set the wrong
incentives and are not acceptable,” the ministry said.
The German ministry welcomed the conditionality tied to the ECB
plan, however. “This means that any possible aid requires that the
benefiting countries tackle their structural problems,” it said.
–Berlin bureau: +49-30-22 62 05 80; email: twidder@marketnews.com
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