GERMAN ECONOMY

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GERMAN ECONOMY

• By Alisa

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Remembrance, Responsibility, and the Future

• German enterprises were integrated in the
  government-run war economy under the Nazi regime.
• And were thus also involved in the wrongs
  perpetrated by it. Persecution and forced labor
  were
• initiated by the Nazi state. Consequently, it
  was the Federal Republic of Germany as the legal
• successor of the German Reich that made
  compensation to most people who suffered
• persecution.

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ECONOMY

• Germany possesses the worlds third largest most
  technologically powerful economy after the U.S.
  and Japan, but its basic capitalistic economy has
  started to struggle under the burden of generous
  social benefits.

• Structural rigidities like a high rate of social
  contributions on wages have made un-employment a
  long term, not just cyclical, problem, while
  Germanys aging population has pushed social
  security outlays to exceed contributions from
  workers.

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UPGRADING

• The integration and upgrading of the eastern
  German economy remains a costly long-term problem
  with annual transfers from the west amounting to
  roughly 100 billion.
• Growth slowed to 1.5 in 1999, due to lower
  export demand and still low business confidence.

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GERMANYS ECONOMY STUMBLES

• Germany has unveiled another set of gloomy
  economic statistic, indicating that recent labor
  unrest may have hobbled the countrys hesitant
  recovery.
• Industrial production has taken a sharp knock,
  unemployment has continued to inch higher, and a
  key measure of business confidence has dropped
  once again.
• But despite Germanys crucial position in the
  European economy, the euro shrugged off news,
  climbing to 0.9937 by 1600 GMT.

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GERMANY BUILDS BACK UP

• 5 years after the Berlin Wall, progress towards
  economic integration between eastern and western
  Germany is clearly visible, yet the eastern
  region almost certainly will remain dependent on
  subsides funded by western Germany until well
  into the next century.
• The staggering 390 billion in western German
  assistance that the eastern states have received
  since 1990 40 times the amount in real terms of
  U.S. Marshall Fund aid sent to west Germany after
  World War 2 is just beginning too have an impact
  on the eastern German standard of living, which
  plummeted after unification.