Economy in Germany continues to decline and is expected to continue declining

Germany's Vice Chancellor, Robert Habeck, noted that the country's financial conditions are not satisfactory. On October 9, Habeck, who is also minister of economy, said that later the official forecasts were made for this year had a growth of 0.3% for a contraction of 0.2%. This fact leads to a 0.3% deficit in production realized in 2023. The meaning of this is that Germany is facing its first recession in two in more than twenty years.

Germany has not been doing well in the economy since the COVID pandemic

Germany has made almost no financial progress since the start of the coronavirus pandemic, falling behind the rest of other rich countries. German economist Isabel Schnabel, who is part of the European Central Bank, noticed that growth in the Euro area, with the exception of Germany, has been “remarkably resilient” since 2021, however, it has been faster than growth in other countries with great savings. Talking about the economy in the eurozone, without mentioning Germany, is similar to talking about Texas and California when referring to the economy of the United States. Germany, which was once a financial engine in Europe, has now become an obstacle for the European economy.

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_{Robert Habeck and Isabel Schnabel (Photo: reproduction/ Christian Marquardt/Horacio Villalobos/Getty Images Embed)}

External factors afflict the country, but internal situations also hinder

Several situations occurred that caused Germany to be in financial decline. One of them was the increase in energy prices that happened shortly after Russia invaded Ukraine in 2022. Furthermore, China's industrial excess causes damage abroad. The German economy depends on exports and has a high manufacturing rate, a difficulty that has been faced since 2021. Even if blaming external factors for the economic decline is an escape valve, the problems that are happening in Germany are much more complicated and arise within the country itself, in addition to a difficult situation that is hindering a political response on the subject.

Featured photo: Wallet with Euro Banknotes in a supermarket (Reproduction/Hannibal Hanschke/Getty Images Embed)