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Germany Expected to Raise Economic Growth Forecast

German Economy Minister, Michael Glos, said he expected that the country`s growth forecast will be raised again in January. The current forecast is 1.4%. Eichel said that the economic mood in Germany hasn`t been this good since the reunification of the country in 1990. The minister wrote a guest column for the prominent German newspaper the Bild am Sonntag. "I expect that we will in January once again raise the official growth forecast of 1.4 percent for 2007," he said in the column. Glos didn`t say what the new forecast will be but economists estimate that it might reach 2.1%.

Glos said that the economic reforms made under Chancellor Angela Merkel`s government have greatly improved the German economy. The minister called on more reforms that will lead the German economy, Europe`s largest, to further growth, these measures include the lowering of electricity prices and cellular roaming charges. Glos added that the raise in tax, including a 3% raise in VAT, affective as of January 1, must be a one-time deal.

The International Monetary Fund (IMF) and the Organization for Economic Co-operation and Development (OECD), estimate that the German economy is on its way to have its best year since the year 2000, mainly due to a growth in the country`s export and a rebound in local demand. Both organizations estimated that the Germany`s growth rate will be somewhere between 2.5% to 2.6% and at a rate of 1.5% to 1.8% in 2007.