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Economy

Transatlantic Competition: US Economy Finds New Spark Against Divided Euro Zone

In the competition between world's top economies, Germany continues to carry Europe and the U.S. starts to roar back to life

US factory worker

Germany's current economic upswing is lasting longer than expected. Although economists warned last year that German industrial output would drop sharply because of weaker demand from abroad, it hasn't happened yet. In November, industrial output increased significantly – by more than five percent over the previous month.

Even though a few major contracts are distorting this picture, German export-driven expansion seems to be continuing. The demand for German cars and machinery has increased sharply in recent months, and orders from abroad increased by 8.2 percent last November. The order books of major industrial firms are full enough for Carnsten Brzeski, an expert in German markets at ING, to speculate that "the influx of new orders in the coming months might even lead to bottlenecks in production."

The entire Euro zone is looking forward to a good economic year and the region's economic mood improved more than expected in December. In the past month, the European Commission's economic climate index has reached its highest level since late 2007. This increase can be attributed to the balances of industrial enterprises in Germany, which are expected to increase in the coming months.

The economic mood has improved most significantly in Germany, France and Italy. However, the peripheral economies of Spain and Greece continue to deteriorate, and European consumers remain more skeptical than businesses, with the consumer confidence index dropping since November.

On the other side of the Atlantic, the economy appears to be developing more quickly than expected. In the past few weeks, a rolling series of positive indicators has surprised economic experts. The profits of U.S. companies are on a steady upswing, with many beginning to invest again. Private consumption increased in the fourth quarter, leading to surprisingly strong Christmas sales for U.S. retailers. As a result, many economists want to revise their growth forecasts to put the U.S. on top.

Commerzbank has shared its revised US forecast with Die Welt. Previously, the bank's experts predicted US growth of three percent for 2011. In light of the recent positive news, analysts now expect the American economy to grow by four percent this year. This prediction differs from the general consensus, as the majority of economists are expecting the U.S. economy to increase by just below three percent in 2011. "The U.S. economy's hand brake has been loosened, and the wagon is rolling," says Joerg Kraemer, chief economist at Commerzbank. "Even the labor market seems to be picking up. The number of new applications for unemployment benefits is already dropping."

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Society

Italy's Right-Wing Government Turns Up The Heat On 'Gastronationalism'

Rome has been strongly opposed to synthetic foods, insect-based flours and health warnings on alcohol, and aggressive lobbying by Giorgia Meloni's right-wing government against nutritional labeling has prompted accusations in Brussels of "gastronationalism."

Dough is run through a press to make pasta

Creation of home made pasta

Karl De Meyer et Olivier Tosseri

ROME — On March 23, the Italian Minister of Agriculture and Food Sovereignty, Francesco Lollobrigida, announced that Rome would ask UNESCO to recognize Italian cuisine as a piece of intangible cultural heritage.

On March 28, Lollobrigida, who is also Italian Prime Minister Giorgia Meloni's brother-in-law, promised that Italy would ban the production, import and marketing of food made in labs, especially artificial meat — despite the fact that there is still no official request to market it in Europe.

Days later, Italian Eurodeputy Alessandra Mussolini, granddaughter of fascist leader Benito Mussolini and member of the Forza Italia party, which is part of the governing coalition in Rome, caused a sensation in the European Parliament. On the sidelines of the plenary session, Sophia Loren's niece organized a wine tasting, under the slogan "In Vino Veritas," to show her strong opposition (and that of her government) to an Irish proposal to put health warnings on alcohol bottles. At the end of the press conference, around 11am, she showed her determination by drinking from the neck of a bottle of wine, to great applause.

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