German economic growth has been mired in stagnation in the fourth quarter of this year and further into the next year as the current eurozone's debt crisis overshadowed the global economy, the latest report of OECD said on Monday.
Furthermore, the whole eurozone economy would slip into recession had there not been timely and decisive measures taken by the European Central Bank (ECB), the report indicated, saying that the economic performance of the 17 states with the single currency is expected to shrink by a relatively big margin.
The German economy will slow down by 0.6 percent in the fourth quarter of 2011 and by 0.3 percent for the first quarter of 2012, compared to their corresponding periods of previous year, according to the OECD forecast.
The euro area is expected to grow 1.6 percent this year, then decline to a mild growth of only 0.2 percent in 2012 before rebounding to 1.4 in 2013, said Economic Outlook released by the Paris-based organization which focused on the eurozone in this edition.
"The global economic situation deteriorated significantly since the early years of the OECD outlook," the report said, as it urged the ECB to assume more responsibility in tackling the spiralling debts crisis.
"To reduce the risk of infection in the euro zone, the European rescue fund be increased substantially and the European Central Bank will be involved with," chief economist Pier Carlo Padoan said. "Only by doing so, it can significantly increase the firepower together with the necessary reforms that counteract negligence."
OECD report remains relatively optimistic about the German economy, predicting it will begin recovery from mid-2012 and achieve an annual growth of 0.6 percent in the whole year of 2012.