German Finance Ministry says debt to drop from 80.5 pct of GDP to 69 pct in 2017

Germany's Finance Ministry says its long-term budget plan foresees the country's overall debt burden shrinking from the current 80.5 percent of its annual economic output to 69 percent by 2017.

It said in a statement Wednesday the significant debt reduction will be possible as the country balances its budget and reduces new borrowing.

This year's overall deficit is expected to be around 0.5 percent of GDP, well below the EU target of a maximum of 3 percent.

The announcement illustrates the sharp contrast between Germany — Europe's biggest economy — and some of the bloc's other nations, five of which had to seek a bailout package because of their deteriorating public finances.

Germany has so far been able to weather much of the European financial crisis with modest growth.