A slump in exports caused the German economy to contracted by a record five percent last year.
German exports declined by 14.7 percent last year from 2008.
Germany is heavily dependent on foreign trade for growth and economists expect exports to lead the country’s recovery.
Detailing the contraction, a report from the Federal Statistics Office said the country’s economy stagnated in the final three months of the year:
The head of Federal Statistics Office, Roderich Egeler, said: “The data suggests that Germany experienced the worst recession of its post-war history in 2009. The economic slump was particularly pronounced during the winter months.”
The Statistics Office report noted that it appears China did overtake Germany last year as the world’s biggest exporter of goods.
A sluggish recovery could hit Germany’s labour market this year which would create a political headache for Chancellor Angela Merkel.
However, Germany is reportedly about to raise its growth forecast for this year to about 1.5 percent from a previous projection of 1.2 percent.