The German economy is the largest in the EU and, therefore, the Eurozone, so the fact that its economic growth picked up over the course of last year can only be considered to be good news. The German GDP is estimated at $3.36 trillion (currently, €3.15 trillion); the GDP of the EU as a whole, by comparison, is roughly $16.3 trillion.
According to Germany’s Federal Statistics Office, the nation’s GDP expanded by 1.9% last year over the 2015 figure. The growth in the German economy has been put down to increased household spending coupled with greater state spending. Figures suggest that domestic expenditure rose by 2% and governmental spending was up by 4.2%, part of which was attributed to caring for asylum seekers arriving in the country from conflict zones such as Syria and Afghanistan.
Initial estimates predict that Q4 growth will come in at 0.5% for 2016, but the formal first estimate will not be released until February.
If the figures are confirmed, it will point to a modest, but accelerating rate of annual growth of the German economy which grew at 1.6% in 2014, 1.7% in 2015 and 1.9% last year. This is a move in the right direction, of course, but is hardly putting the “clear water” of strong growth behind the Global Financial Crisis.
Germany imported 3.4% more goods in 2016 than 2015, but exported goods also rose by 2.4% over the 2015 level, however, Germany is running a budget surplus.
The German people will be going to the polls in the third quarter of the year and tensions over immigrants (economic migrants and refugees) will be a feature that Right Wing parties will seek to exploit; particularly in the wake of the terrorist outrage in Berlin before Christmas.