Mon. Jun 17th, 2024
German economic institutes reduce 2024 growth forecast to 0.1% – DW – 03/27/2024

The German economy is struggling, according to a report released on Wednesday by a group of leading economic think tanks. Titled “German Economy Ailing: Reforming the Debt Brake is No Cure-All,” the report predicted that the country’s growth rate for early 2024 would be near stagnation at 0.1%.

The report highlighted several factors contributing to Germany’s sluggish overall economic development, including both economic and structural issues. It stated that the situation was expected to improve soon but would not be “all that great.”

Consumers and their recovering purchasing power, as inflation sinks and wages rise in many sectors, were identified as the most important fuel for an economic recovery. The collective diagnosis is a collaboration between several leading German economic institutes such as DIW in Berlin, IfW in Kiel, IWH in Halle, RWI in Essen, and Ifo in Munich. Additionally, the German government also revised its economic forecasts downwards.

Another factor contributing to Germany’s struggles has been frequent strikes impacting its rail network and air travel leading to canceled flights and trains. However, a resolution was reached earlier this week with one of the major labor disputes between Deutsche Bahn and GDL train drivers’ union after months of negotiations. Despite these challenges, the report indicated that Germany is expected to return to slight growth in the near future.

By Aiden Nguyen

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