German economy to grow 4.9 per cent in 2021, research institute says

Essen, March 24, (dpa/GNA) - The German economy is to grow by 4.9 per cent in 2021 despite an extended coronavirus lockdown, the Macroeconomic Policy Institute (IMK) said Wednesday.

Gross domestic product (GDP) will continue to grow by 4.2 per cent in 2022, according to IMK's economic forecast.

"Unfortunately, the coronavirus pandemic has not yet been defeated, and risks remain," said the institute's director, Sebastian Dullien.

But economically, signs are pointing towards a recovery. The main forces of growth this year are foreign trade and private consumption, which will also become the dominant growth factor in 2022, the institute said.

However, the forecast is "fraught with considerable uncertainty," Dullien said, adding that it was difficult to estimate how severe the third wave of coronavirus infections would be.

Other possible dangers include a wave of insolvencies greater than previously expected, according to the institute.