German companies may be starting to invest again

During the fourth quarter of 2003, annual output growth was just 0.2%, according to preliminary figures.

The news confirms that the downward trend of 2003 is at last starting to reverse, but much less resolutely than economists had hoped.

And the 0.2% rise could have been the result of statistical factors, meaning that actual performance was stagnant.

In France, by contrast, growth was 0.5% in the fourth quarter, preliminary figures indicated.

High hopes

The figures, which are due to be released in expanded form on 19 February, do offer some hope for likely performance in 2004.

The component of gross domestic product relating to consumption was relatively strong, the Federal Statistics Office said.

This could be an indication that companies are starting to invest more, something that could promise eventually to reduce Germany's heavy unemployment.

"The relatively strong domestic demand gives cause for hope that 2004 will be better," said Bernd Weidensteiner of DZ Bank.