28 August 2013

BFM: With sound finances, steady growth and high employment, Germany is in good shape

The German Cabinet adopted the "Report on the financial situation of the Federation and on economic trends in Germany", focusing on German economic trends since 2009, with an emphasis on the new direction in financial and economic policy that was taken during the current legislative period.

Finance Minister Schäuble commented: "For 2014, we have presented a structurally balanced budget, the first time this has happened in decades. The successful consolidation of the budget within the space of just one legislative period is the result of sound and forward-looking fiscal policies. In this way, this Federal Government has succeeded in achieving a fundamental change of political course in relation to previous decades."

Economics Minister Rösler commented: "Economic growth in Germany is currently gaining new momentum. This means that Germany is also helping the eurozone as a whole to emerge from the recession of the last year and a half. Growth in the German economy is increasingly being driven by domestic demand. Relief for German citizens in relation to taxes, charges and not least the mandatory quarterly medical consultation fee, which together amounted to €22 billion, has played an important role in this regard. Consumer and business confidence is increasing once again. Along with the growth-friendly consolidation of our public budgets, we have given the competitiveness of the German economy a lasting boost through structural reforms. These policies are bearing fruit. That can clearly be seen in the favourable economic developments in Germany."

The German economy has overcome the slump that resulted from the global financial market crisis in 2009 faster and better than almost any other comparable industrialised country. Even during the European sovereign debt crisis, Germany remained on course for growth. Unemployment is currently at its lowest level in 20 years. Employment is at a historic high, with 1.9 million jobs being created in this legislative period alone.

In recent years, Germany has also placed its public finances on a solid foundation. The Federation has played a crucial role in this regard. This was achieved despite the fact that the federal budget was deeply in the red following the global financial and economic crisis.

In the coming years, Germany’s public debt will shrink significantly, for the first time in decades. Debt levels will be reduced by more than 10 percentage points, according to current forecasts. The Federal Government’s economic and fiscal strategy has demonstrated that consolidation and growth go hand-in-hand. The consolidation of public finances provides a basis for sustainable economic growth, high employment, rising incomes and solid tax revenues.

Full press release

© Bundesfinanzministerium