(Adds reporter’s name in signoff) BERLIN, Jan 25 (Reuters) - The German economy, Europe’s largest, will likely reach its pre-pandemic levels in mid-2022, according to a draft document prepared by the economy ministry and seen by Reuters on Monday. The world economy’s situation, underutilised production capacities and early indicators suggest a further recovery of the German economy, the ministry said in its draft annual economic report. Germany’s budget deficit is seen at 7% this year when compared to gross domestic product, leading to a debt ratio of 72.5%, the ministry said, as Berlin is spending billions of euros to cushion the economic blow of the pandemic. (Reporting by Christian Kraemer and Andreas Rinke; writing by Thomas Seythal; editing by Riham Alkousaa)