IMF Recommends Germany to invest more in infrastructure and education By La Recontra Oferta Newspaper LRON at San Jose, CA U.S. 17:00PM 08.09.2014 Germany passes the test with flying colors which was submitted to the International Monetary Fund (IMF). The document summarizes the views of the governing body of Christine Lagarde on the economic situation of the country are many clear, but it also presents a few questions. IMF Doubts mainly from the ability of the European locomotive to continue growing in the medium term. The recipes come from Washington pass to pull the checkbook Berlin: Germany calls on the Fund to increase its investment in sectors such as transport infrastructure and education. The requirement that Berlin European Truck tire increasing their investments is not new. The coalition between Christian Democrats and Social Democrats who left the last election an investment plan agreed 23,000 million for the entire legislature. This figure, which is an investment each year about 0.3% of GDP, disappoint those who expected a more ambitious package to help renovate an infrastructure network in some areas has been frankly outdated and, in turn, contribute boost the economic recovery of the continent. The IMF now gives good news says the data growth and improve anticipates a gradual normalization of some indicators showing eurozone imbalances such as excessive trade surplus Berlin. Our forecast for GDP growth in the short term is gaining strength, to 1.9% this year and 1.7% next. The actual current account surpluses should begin to shrink slowly and inflation will rise and will continue over the rest of the euro area, the report said. But the Washington-based body also detects risks in the near future. The medium-term growth will remain limited by the international situation, which is still very weak, uncertainties about the future cost of energy and the adverse demographic trends, says the document. It is at this point that the IMF recommends that the government of Angela Merkel to adopt policies that promote growth, and that underpin the role of the German economy as a support for regional stability. To achieve this goal, the most powerful country in Europe should strengthen domestic sources of growth. To promote private investment and reduce the current account surplus would be beneficial both for Germany and for all the euro area, say the technicians of the Fund, which also detected leeway to boost public investment in projects with significant economic value, especially transport infrastructure and education. The European Commission already warned in November last year to Germany that its economic imbalances impeding the exit of the eurozone crisis. Along with these lightweight ear pulling, and yours Lagarde praised reform achievements and some of the Germans. Among the former, its healthy public finances and robust labor market, with unemployment rates at historic lows and growing domestic demand. Among the latter, the senior Fund applaud initiatives such as increasing competitiveness in certain markets and energy reform and urge the authorities to implement the minimum wage provided that potential adverse effects are taken into account. The IMF devotes a separate chapter to the new minimum wage, starting next Jan. 1 will ensure that the German workers, with some exceptions, charge at least 8.5 euros per hour. Fund staff remember that this decision will have a special effect in this country, where wages are lower. After listing the arguments for and against this measure, the document warns that the minimum wage could have unintended employment especially in the eastern states, an effect due to the greater number of workers affected and their unemployment rates higher .
Posted on: Sun, 10 Aug 2014 00:03:46 +0000
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