Germany overtook the UK as the fastest growing among the G7 states during 2016. Europe’s largest economy expanded at the fastest rate in five years, showing growth of 1.9% last year.
The expansion pushed Britain into second place among the G7 industrialised nations, after the Office for National Statistics revised down annual UK growth to 1.8%, from an initial estimate of 2%.
In the final quarter of 2016 Germany’s economy grew by 0.4%, improving on 0.1% growth in the third quarter. It was fuelled by domestic demand as government and consumer spending rose.
Germany proved the International Monetary Fund wrong, after the Washington-based fund predicted the UK would outpace its G7 peers.
Alan Clarke, economist at Scotiabank, said the economies of both countries had turned out a decent performance last year, and pointed out that UK growth of 0.7% had outpaced Germany in the fourth quarter.
He said: “UK economic growth in 2016 was fractionally below that of Germany – no longer the fastest growing in the G7. In the big scheme of things 0.1 percentage points between friends isn’t something that anyone is going to notice. And if anyone wanted to pick a fight, you are only as good as your last game and the UK scored 0.7% growth in the fourth quarter. Both economies are doing pretty well and survey indicators for [each] suggest more good news early 2017.”
