The International Monetary Fund said Wednesday that Germany's public spending ramp-up must be accompanied by "pro-growth" reforms to ensure Europe's beleaguered top economy makes a sustained recovery.

Chancellor Friedrich Merz's coalition is making huge extra outlays on infrastructure and defence, which it hopes will spur a turnaround after two years of recession.

After a visit to Germany by several of its officials, the IMF praised the country's "landmark" decision this year to ease strict debt rules, which paved the way to a sharp increase in public spending.

This had "set the stage for economic recovery," it said in a statement.

But the financial institution called for the extra money to be spent wisely to put the economy on a sustainable long-term footing.

It also said the efforts

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