Frankfurt (AFP)

Germany will be able to avoid a new phase of generalized containment despite a surge in cases of Covid-19 infections, estimated its Minister of the Economy on Tuesday, who expects a recession less bad than expected in 2020.

"I am convinced that we can and will prevent a second general lockdown," said Peter Altmaier, during a press conference dedicated to the presentation of a new, more optimistic economic forecast for Europe's largest economy.

"We are facing a V-shaped course, characterized by a rapid recovery after a deep fall," he added, waving before the cameras a graph showing the growth curve.

This proves that an economic recovery "is possible even in times of coronavirus".

But vigilance remains in order, "we are not making any new relaxations and are respecting the rules of hygiene, the wearing of masks and distancing," he continued.

Germany, which has so far resisted the pandemic better than its neighbors, has recorded nearly 1.250 new confirmed cases of Covid-19 per day on average over the last week, against less than 500 during July and August.

If we remain far from the record of early April with 6,000 daily cases, the government has nevertheless tightened some restrictions last week, in particular the checks on compliance with quarantines imposed on travelers from countries at risk.

- Economic rebound better than expected -

As long as the situation remains under health control, the recession in the first half of the year was "less severe than what we feared" and the rebound "is faster and more dynamic than what we had hoped," explained Mr. Altmaier.

As a result, the government has slightly raised its forecasts and now expects a 5.8% drop in gross domestic product in 2020, less bad than the 6.3% initially announced.

In the second quarter, GDP fell by 9.7%, after 2% from January to March, but "since May we have seen a clear recovery" which should continue for the rest of the year, detailed the minister.

While the rebound will naturally be less strong in 2021, with growth of 4.4%, he expects production from the start of 2020 to return to the pre-crisis level.

The labor market also seems to be on a positive turn, with the unemployment rate stabilizing at 6.4% in August.

And the number of people on short-time work fell again in June (most recent month for which data is available), to 5.36 million, against 5.82 million in May and 5.98 million in April.

- Under perfusion -

"On average, 2.5 million people should be on short-time work this year, according to Labor Minister Hubertus Heil, who ruled on Tuesday that" the crisis is not over. "

To support the economy, Berlin urgently released hundreds of billions of euros from March 2020.

The German government also decided last week to extend the "Kurzarbeit" (partial unemployment) device in the face of the more lasting than expected economic impact of the epidemic.

The maximum period for which businesses and employees can benefit from state funding has been increased from twelve to 24 months and insolvency laws have been relaxed.

But some see in these measures the risk of supporting "zombie companies", that is to say non-viable.

"While this is good news for employees, private consumption and the short-term outlook for the economy, it increases the risk of delaying potentially necessary structural changes," comments Carsten Brzeski, economist at ING.

© 2020 AFP