Germany's finance ministry this week reported a 2015 budget surplus that is double the original target and the result of record tax revenues and one-off effects. Wolfgang Schäuble, finance minister, said that he would allocate the surplus of €12bn to refugee costs — the surplus gross domestic product ratio was 0.5%.

 

The government’s surplus totaled €500m in 2014 and it was the first time all government levels — which include the central government, state and local governments and social security fund — reported surpluses since German reunification in 1990. It was also the first total surplus since 1969.

Destatis, the federal statistics office, reported Thursday that price-adjusted gross domestic product (GDP) rose 1.7% on an annual average in 2015 on the previous year. In 2014, the GDP growth rate had been similar (+1.6%), while in 2013 it had been just +0.3%. Examining the longer-term economic growth reveals that growth in 2015 was above the average of the last ten years (+1.3%) again.

The German government is forecasting GDP growth of 1.8% this year and it also expects to achieve a balanced budget despite the growing refugee costs. After adjusting for the number of working days, the 2015 growth figure was slightly lower at 1.5%.

Consumption rose 1.9% in 2015, contributing 1 percentage point to the rise in gross domestic product. Public spending added 0.5 points to growth and net trade 0.2 points.

Destatis said earlier this month that compared with the same month a year earlier, the number of persons in employment increased by 424,000, or 1.0%, in November. In October 2015, the growth rate had been 0.9%. Roughly 1.9m people were unemployed in November 2015, 166,000 fewer than a year earlier.

“The German economy is moderately tilted to the upside, but it can’t completely escape the bumpy global economic environment,” the ministry said in its January monthly report released Wednesday according to The Wall Street Journal. It expects the Chinese economy to succeed in a soft landing and said the performance in the industrialized countries remains relatively robust.

Pic above: Journalists await the arrival of Chancellor Merkel by helicopter, 6 Jan,2016, to attend the winter meeting of the parliamentary group of the CSU, the sister party of Merkel's CDU, in Wildbad Kreuth, Bavaria. Photo: Bundesregierung/Bergmann