Main focus of Monday, August 23, 2010

German economy booms

Reacting to Germany's surprisingly strong economic development in the second quarter, German economic experts have raised their growth forecasts for 2010 to as high as 3.4 percent. Commentators say Germany's growth could harm the French economy but benefit Poland.

Le Monde - France

The daily Le Monde analyses the recovery of Germany's economy and its impact on France: "It's true that the 0.6 percent increase in the [French] gross domestic product is a very respectable achievement, ... but it's four times less than the increase in Germany. ... The sharp rise in Germany's economic performance will spoil the celebrations in Paris. Indeed, if the French economy falls behind its most important trading partner the consequences could be disastrous. So far France has been spared the debt crisis that has hit countries in Southern Europe. The country even found itself on the good side - that of Germany. ... But the surprising surge on the other side of the Rhine threatens this concordance. The risk is clearly, ... that the famous 'spread' between the interest rates in the two countries will grow larger." (21/08/2010)

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Rzeczpospolita - Poland

The economic boom in Germany will also be good for Poland, writes the conservative daily Rzeczpospolita: "As economists are saying across the board, the German Mercedes tanks up with fuel from the economies on the edge of the Eurozone. The good economic results have led the German Federal Bank to radically adjust its economic forecasts upwards - anticipated GDP now stands at three percent. Let's not forget, the German economy shrank by as much as 4.7 percent in the past year. So what happened? Exports have shot up on the other side of our western border. Solid, although less dynamic growth is also expected in the next quarter. Domestic demand has been influential here, and that is also good news for Poland. Our exports to Germany are growing and stand to become even more dynamic." (23/08/2010)

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De Volkskrant - Netherlands

Germany's strong economic growth is proof of the success of the German economic model, writes the left-liberal daily De Volkskrant: "The country that had to save the most money - primarily to pay for the reconstruction of the former GDR - is in the best shape in Europe today. That gives the German government considerable backing in its resistance to recovery measures undertaken in other parts of the world. Standing in contrast to the US model - holding back on government saving until consumers can once more take over the role of economic motor from the state - is the German model, which combines thriftiness with the social mandate of Rhine capitalism. Germany is accused abroad of growing at the expense of other EU countries. ... However this doesn't seem to be borne out by the facts. German imports have grown even faster than exports in recent months." (23/08/2010)

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