IMF urges Germany to spur domestic demand

BERLIN (AP) ? The International Monetary Fund is urging Germany to boost domestic demand to ensure Europe's biggest economy doesn't falter if exports drop off.

The Washington-based IMF says the government should allow low unemployment and rising wages to naturally lift consumer spending.

It also recommends improving conditions for investment outside of Germany's traditional areas of strength such as manufacturing.

In its annual report released Tuesday the IMF said greater domestic demand in Germany would also benefit other countries in the troubled eurozone area.

The IMF identified the eurozone's debt woes, undercapitalized banks and the possibility of a global downturn as the biggest risks to the German economy.

The report's authors concurred with a recent German central bank forecast of 1 percent economic growth for 2012.

Associated Press

Source: http://hosted2.ap.org/APDEFAULT/f70471f764144b2fab526d39972d37b3/Article_2012-07-03-Germany-Economy/id-3155ccfc5ca84c198cb51d91fedf384f

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