Ash to cloud German economy: minister

22nd April 2010, Comments 0 comments

Disruption caused by the volcanic ash cloud will dampen the German economy, Europe's largest, but should not harm the country's growth figures, Economy Minister Rainer Bruederle said on Thursday.

"The volcanic eruption and the flight restrictions will put a damper on the economy but are not a catastrophe," Bruederle told ZDF public television.

"I do not think it will be felt in the annual (growth) rate," he added, a day after publishing new government forecasts that estimated economic growth of 1.4 percent this year.

In addition to the economic damage to airlines, the airspace restrictions over Germany had knock-on effects on industry. Automaker BMW, for instance, was forced to halt production because it did not receive the necessary parts.

German airspace reopened on Wednesday, bringing relief to thousands of stranded tourists but leaving airlines to count the cost.

Bruederle dismissed the idea that the state should stump up aid for airlines, saying: "You have to be in a position to manage the ups and downs of economic life."

Flag carrier Lufthansa, Europe's largest airline by passenger numbers, has seemingly ruled out applying for state aid but Germany's number two, Air Berlin, has said it would study this option.

© 2010 AFP

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