Germany's economy slows down as pandemic surges

The German government on Wednesday cut its growth forecast for this year to 3% as Europe's biggest economy faces persistent headwinds from the coronavirus pandemic.

In late October, the government had forecast growth of 4.4% this year. The country started a partial shutdown shortly afterward and deepened it in mid-December.

That lockdown, Germany's second, is still in place.

Official data released earlier this month showed that the economy shrank by 5% last year, ending a decade of growth. That was still a smaller drop than many had expected.

"After just under one year of pandemic experience, we can say that we have succeeded in preserving the substance of our national economy at its core and also in preserving the vast majority of jobs and companies in Germany," Economy Minister Peter Altmaier told a news conference in Berlin.

Germany had a relatively successful first phase of the pandemic, but saw infections shoot up during the fall and winter months.

Restaurants, bars, sports and leisure facilities were shut on Nov. 2 in an effort to halt the rise. That succeeded for a while, but didn’t bring case numbers down.

Schools and nonessential shops were closed on Dec. 16, and the restrictions were extended last week until Feb. 14.

Although cases are now falling, authorities are worried about the potential impact of new virus variants such as the one first detected in Britain.

"I think that when it comes to the lessons, the conclusions of this crisis, we have to understand that a determined, an effective fight against the pandemic, a reduction of new infections is of great importance not only in the health protection of millions of citizens, but also in the interest of a competitive, growing national economy," he said.

(Image Credit: AP)