Germany’s federal economy minister Peter Altmaier expects Europe’s largest economy, which is currently mired in recession, to start growing again “at the latest” from October.
In an interview with Bild am Sonntag newspaper, Altmaier said he believed that the economic slide can be turned around after the summer break and that the German economy will be on an upswing from Autumn again.
“All in all, the German economy will shrink by 6% in 2020,” Altmaier said. “For 2021, I expect growth of over 5%.”
German industrial orders rose by rose by 10.4% in May, data from the economy ministry showed on Monday, as coronavirus lockdown measures began to ease. However, the ministry warned that “the low level of orders also shows that the recovery process is far from over.”
The important thing now for the resurgence of the economy is that the government needs to prevent companies from collapsing and jobs from being lost, Altmaier said, adding: “The stimulus package must be implemented quickly.”
The German government unveiled a €130bn (£117bn, $146bn ) financial stimulus package in June that includes electric-car buyer incentives, lowering VAT from 19% to 16% through September, and €25bn in loans and grants to support small and medium-sized businesses over the next three months.
Altmaier said that while the nationwide lockdown in Germany in April and May has significantly hurt the economy, “our vigorous action has resulted in thousands of lives being saved in Germany compared to our European neighbours, not least thanks to the great discipline of our citizens.”
He expects the unemployment levels in Germany to peak through October and start improving from November onwards, adding: “My goal is to reach pre-crisis employment levels by 2022 and then gradually full employment.”
The economy minister said that he was “very concerned about the increasing number of new infections in the USA,” since the pandemic running out of control in the US has “major consequences for the global economy.”