Germany is set to dodge recession in 2012 despite the euro zone debt crisis.
The government said the country should double its growth rate next year, as it unveiled new forecasts for Europe's top economy.
Europe's powerhouse will grow by 0.7% in 2012 and by 1.6% next year, Economy Minister Philipp Roesler said, sticking to Berlin's forecast made in January.
"Growth of 0.7%, higher income and more people in employment show that Germany is doing well. Germany is and remains the growth motor in Europe," he said.
Unemployment is expected to drop to 6.7% this year and to a new record low of 6.5% in 2013, the government said.
Germany has defied the euro zone debt crisis and generally performed better than its trading partners in Europe. Data published earlier today showed that Britain's economy unexpectedy sank back into recession in the first quarter of the year, contracting by 0.2%.
However, Roesler warned that the German forecasts were "on the cautious side."
"The risks from the international environment remain high. The European sovereign debt crisis has not been solved," he said.
And he stressed Germany's line that austerity measures were the best way to secure a solid economy, as a debate rages in Europe about shifting the crisis-fighting strategy to fostering growth rather than tightening belts.
"The positive trend in Germany shows that budgetary consolidation and courageous structural reforms pay off on the labour market. That is an important message to our partners in Europe," said Roesler.
