German Chancellor, Dr Helmut Kohl says the German economy will grow faster in 1998 than previously expected, and this would begin to help to cut record unemployment early next year. "Economic developments are better than many people have believed," he told an industry conference in Berlin yesterday. "The economy will grow some 2.7 per cent to 2.8 per cent this year, and next year it will grow 3 per cent or more."

Germany's six leading economic research institutes are due to make new forecasts next week and are expected to present evidence that the upswing is beginning to pick up. Higher growth would also help Germany to meet qualifying targets for European economic and monetary union.