Of the four largest countries in the euro zone, it is the only one whose GDP has stagnated. The industrial model of the country is upset by the disruption of global subcontracting channels and the outbreak of raw material prices.
by
Will stagnation lead to a recession in Germany? The question is now arising, while the growth of the German economy was zero in the second quarter, according to figures published on Friday July 29 by the Federal Statistics Destatis. Of the four largest countries in the euro zone, Germany is the only one whose gross domestic product (GDP) stagnated between March and June, unlike France (+ 0.5 %), in Italy (+ 1 %) and Spain (+ 1.1 %).
If Destatis has strongly revised upwards the growth of the German economy in the first quarter ( + 0.8 % and not + 0.2 %, as initially announced), the figures for the second quarter are final: in A euro zone which has experienced overall growth of 0.7 %, the stagnation of German GDP during this period shows how much the first economy of the continent is in pain “in a difficult global economic context, with the Pandemia From Covid-19, the disturbed supply chains, the rise in prices and the war in Ukraine, “observes Destatis in its press release published on Friday.
Monday, already, the last measure of the business climate index published by the Munich Economic Institute (IFO) had the effect of a cold shower. According to this barometer which measures the morale of around 9,000 German entrepreneurs each month, it fell 3.6 points in June, its lowest level since June 2020, after the first wave of the pandemic.
“The mood has completely turned”
“Businesses expect business to become much more difficult in the coming months. The mind -mound and the threat of a gas shortage weigh on the economy. Germany is on the verge of recession, “said Clemens Fuest, the director of IFO, observing that from industry to trade and construction, all sectors of the economy are won by concern . “Even in tourism and hotels, where the climate was still very optimistic recently, the mood has completely turned,” observes Mr. Fuest.
For Germany, these figures are all the more worrying since it is the heart of its economic and industrial model, based on cheap energy supplies and a strong dependence on exports, which is turned upside down by The disruption of global subcontracting channels and the outbreak of raw material prices, direct consequences of war in Ukraine.
You have 49.96% of this article to read. The continuation is reserved for subscribers.