Published: October 9, 2024 7:59 pm
Author: RT
Gross domestic product is expected to decline by 0.2% this year, according to the ministry for economic affairs
Germany’s gross domestic product (GDP) is expected to decline by 0.2% in 2024, according to a revised government forecast on Wednesday. This is a sharp downgrade from the previously projected 0.3% expansion.
The latest revision will mark the second straight year of recession in the EU’s economic powerhouse after last year’s contraction of 0.3%.
The country’s ministry for economic affairs said on Wednesday that early indicators such as industrial production and business climate suggest the economic downturn continued into the second half of 2024.
The German economy hasn’t seen powerful growth since 2018 as the country’s structural problems have been joined by wider global challenges, economy minister Robert Habeck said in a statement.
“Germany’s structural problems are now taking their toll. In the middle of the crises, Germany and Europe are squeezed between China and the US, and must learn to assert themselves,” Habeck said, as quoted by media outlets.
For 2025, the minister expects GDP to increase by 1.1%, slightly more than the government’s previous prediction of 1%. “Germany is a country full of strengths,” Habeck stated, adding that if the government’s support measures are “fully implemented, then the economy will grow more strongly and more people will find employment again.”
READ MORE: German industrial orders collapse
Meanwhile, German Finance Minister Christian Lindner denounced the government’s economic policy, telling DPA news agency: “Our economy has been shackled for years by bureaucracy and the tax burden, but – frankly – also by centrally planned economic measures to fight climate change and an increasing policy of redistribution.”
The Eurozone’s largest economy has been falling behind its peers over the past years, largely due to a prolonged manufacturing downturn. Germany’s was the only Group of Seven economy to contract in 2023.
