The central bank forecasts a recession and no growth until the end of 2024, indicating serious challenges for the German economy. A number of factors have been linked to the downturn, including declining international orders, rising financing costs, uncertainty surrounding climate legislation, and a decline in both domestic and foreign demand, which has a particular impact on the production of cars. Higher energy prices and corporate distress are the results of the situation being made worse by the energy crisis that followed the war in Ukraine. Concerns over the struggling economy and real estate problems are reflected in investors' demands for higher interest rates from German companies. China's competition in the automotive industry is making Germany less of an industrial powerhouse. Concerns about growing poverty arise from German Finance Minister Christian Lindner's acknowledgement of the nation's difficulty in producing growth. Companies are taking out fewer loans for investment, which suggests that long-term economic growth is being stunted as they concentrate on solving short-term problems.
https://english.almayadeen.net/news/Economy/german-economy-unlikely-to-resume-growth-in-2024
3 comments:
It definitely makes it hard for them to grow when they are only solving short term problems. After these are mostly solved, I will be interested to see if they will be able to turn it back to growth again. It is hard for Germany when facing the plethora of outstanding obstacles to really be set in a place to where they can flourish economically.
Germany has historically been a very strong economy so I am sure they will correct things eventually, however the outlook is not good as of now so I am curious to see how long it takes for them to iron things out.
Since they are solving primarily short-term problems, Im interested to see how long it takes to get their economy back to being strong.
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