The Federation of German Industries (BDI), originally ‘Der Bundesverband der Deutschen Industrie e.V.,’ confirmed Tuesday that Germany has been forecasted to witness a rise in its economic output by an estimate 1.5% owing to exports picking up pace. However, the BDI also gave a warning signal stating that the country should not put the guard down while being puffed up by its laurels. Dieter Kempf, president of the BDI, said that Germany’s good economic condition is not a free ticket to take rest.
Ditch Tax Cuts, Invest and Reform Tax Legislation
Kempf believes that the success of the German economy has links with the expansive monetary policy of the European Central Bank, moderate price of oil, and euro’s weak rate of exchange. However, the BDI president further added that these factors bear a limited influence of the German economy. With regard to future economic moves, there could be a dire need to make the German economy resilient against the crisis, given several global risks. Record budget surpluses and tax revenues could be engaged for reforming tax legislation and investment instead of leading them to tax cuts.
Another German economic research behemoth, the ‘Ifo’ Institute has raised its forecast of the 2017 economic growth of the country from a 1.5% to 1.8% while mentioning that the influential factors could be so influential that the impetus could carry onto the next year. Germany could testify a strong growth on the back of euro zone recovery fueling healthy exports coupled with vibrant domestic demand.