Germany: Staff Report for the 2014 Article IV Consultation
Electronic Access:
Free Download. Use the free Adobe Acrobat Reader to view this PDF file
Summary:
KEY ISSUES Context: ? Germany fundamentals are sound: balance sheets are generally healthy, unemployment is at a historic low, and the fiscal position is strong. ? While a recovery is underway, medium-term growth prospects are subdued and the current account surplus remains high. The economy also faces a still weak international environment, lingering uncertainty (including about future energy costs), and fast approaching adverse demographic changes. ? Germany could do more to increase its growth, thus strengthening its role as an engine of euro area recovery. Policy recommendations: ? Germany has the fiscal space to finance an increase in needed public investment, particularly in the transport infrastructure. Unlike public consumption, this would durably raise German output and have measurable growth spillovers on the rest of the euro area. ? Further reforms in services sector regulation would boost competition and productivity. ? Greater clarity about the future energy sector regulatory framework would encourage private investment in the energy infrastructure and beyond and strengthen the outlook. ? Decisions on the future level of the minimum wage should take into account the employment effects in certain regions. ? Banks should keep strengthening their capital position ahead of the completion of the ECB’s Comprehensive Assessment. ? The macroprudential framework needs to be ready as monetary conditions are set to remain accommodative for a prolonged period.
Series:
Country Report No. 2014/216
Subject:
Commercial banks Cooperative banks Expenditure Financial institutions Labor Minimum wages Public investment and public-private partnerships (PPP) Public investment spending
English
Publication Date:
July 21, 2014
ISBN/ISSN:
9781498307055/1934-7685
Stock No:
1DEUEA2014001
Pages:
72
Please address any questions about this title to publications@imf.org