The German economy, which grew 1.8% in 2022, is expected to only grow 0.2%, according to a government forecast presented by Economy Minister Robert Habeck.
Reflecting on the economy last year, Habeck said “the country managed to avoid a deep economic crisis” due to government action including the renationalisation of gas companies, public procurement of gas and shortening approval procedures for new infrastructure such as liquid gas terminals.
“Of course, the crisis is not over, we are not through it, but we were able to prevent the worst scenarios,” he added.
In the summer of last year, some scenarios predicted an economic contraction of 12% in case Russia cut off gas supplies to the country, as it did shortly after, Habeck stressed.
Still, the German economy grew by 1.9% over the course of last year.
“We have shown that Germany can be quick, that it can be strong, that it can do a lot. It was the political will, and, if I can say so, the discipline, of many that made this situation controllable,” Habeck said.
Regarding inflation, the government expects it to decrease to 6% in 2023 after reaching 7.9% in 2022.
However, the Conservative CDU party, currently in opposition, did not want to join Habeck in his cheering and called the economic situation “tense”.
“Many companies and businesses are stuck in a cost trap, inflation is putting a strain on value chains, and consumer sentiment is poor,” Julia Klöckner, Economic Policy Spokesperson of the CDU/CSU Parliamentary Group in the Bundestag, said in a statement.
“Leading German companies such as BASF, Bayer or BioNTech are therefore increasingly looking abroad and investing there,” she said, blaming the government for “turning Germany from Europe’s growth engine into the tail light”.
(Jonathan Packroff | EURACTIV.de)
Source: euractiv.com
