GERMANY’S economy is limping into 2021 heavily bruised by the pandemic, deeply reliant on government aid — and in better shape than most of the eurozone.

The nation will probably say today that gross domestic product contracted less than 6 percent last year, and may signal that it actually grew in the final quarter. In contrast, economists estimate full-year declines of around 9 percent for France and Italy and more than 11 percent for Spain.

While the first quarter of this year has started poorly, with lockdowns extended and the eurozone as a whole headed into a double-dip recession, Germany’s Bundesbank is staying optimistic that a steady recovery will kick in as vaccinations rise.

How Europe’s largest economy has pulled through so far is reflected in companies like Munich-based Dr. Sasse AG, which employs almost 7,000 workers offering facilities and cleaning services in four countries. Despite taking as much as a 10 percent hit to sales last year and putting swathes of its workforce on shorter hours, its founder says they’ve survived “with a black eye.”

“The next few years are going to be very demanding as well,” said Eberhard Sasse, who is also president of the Association of Bavarian Chambers of Industry and Commerce. “2021 won’t be a year of crisis, but one where we’re going to have to drive change very actively.”

When Chancellor Angela Merkel pledged last March to do “whatever Germany needs” to get through the coronavirus pandemic, Sasse recorded a video message —with his wife and two daughters — telling employees of the family-owned firm he would mobilize all financial resources available to ensure survival.

What that meant was massive reliance on government support to pay wages, and a refocusing of operations to pull in revenue wherever possible.

That’s helped by one of the region’s most generous fiscal packages, described by Finance Minister Olaf Scholz as having “oomph.” The “kurzarbeit” program spent 22.1 billion euros (US$27 billion) last year subsidizing payroll for companies working at reduced levels.

Such support will have to continue. Restaurants, hotels and non-essential shops will remain closed until at least the end of January, and people in virus hot spots are confined to a 15-kilometer radius around their homes.

On Tuesday, Merkel privately warned that another 10 weeks of lockdown might be necessary to curb the new variant of the coronavirus currently driving higher infection numbers.

But Germany’s manufacturing sector, which makes up about a fifth of the economy and has boosted output when services turned into a major drag, has played a significant part in cushioning the blow. It’ll also help drive the recovery when global demand rebounds. (SD-Agencies)