Europe Economy

IMF urges Germany to invest more in infrastructure


The International Monetary Fund (IMF) urged Germany on Monday to invest more in infrastructure to boost its long-term growth and support the euro zone currency bloc.

In a statement detailing policy recommendations, the IMF said Germany could invest up to 0.5 percent of gross domestic product a year more over four years without violating fiscal rules and with only a small effect on the debt-to-GDP ratio.

Automobiles and a freight truck pass under a road traffic junction sign on the Berliner Ring road near Zernsdorf, Germany, on Thursday, Jan. 9, 2014.
Krisztian Bocsi | Bloomberg | Getty Images

"Such a programme would yield a persistent increase in GDP by crowding in private investment and would also stimulate growth in the rest of the euro area," the IMF said in the statement.

The Fund also expected Germany's recovery to gather further momentum and said it would likely raise its growth forecast for Germany soon.

Read More Europe's crisis not over yet: IMF's Lagarde

The Fund said in April it expected German growth this year of 1.7 percent and of 1.6 percent next year.

Germany's government forecasts growth this year of 1.8 percent, followed by 2.0 percent in 2015.

—By Reuters