So, What Country Wants To Be Like Germany Now?
The collapse of Germany shocks many. But … this was inevitable for over a decade…
Germany Is Unraveling Just When Europe Needs It Most
Bloomberg reports Germany Is Unraveling Just When Europe Needs It Most
Germany is reaching a point of no return. Business leaders know it, the people in the country feel it, but politicians haven’t come up with answers.
That has set Europe’s largest economy on a path of decline that threatens to become irreversible.
Following five years of stagnation, Germany’s economy is now 5% smaller than it would have been if the pre-pandemic growth trend had been maintained.
More worryingly, Bloomberg Economics estimates that the bulk of the shortfall will be tough to recover, due to structural blows such as the loss of cheap Russian energy and Volkswagen AG and Mercedes-Benz Group AG struggling to keep pace with China’s auto firms. The decline in national competitiveness means every household is worse off by about €2,500 ($2,600) a year.
To revive competitiveness, Germany ultimately needs to spend more. Just to catch up with other advanced economies, the country will have to increase annual investment on infrastructure and other public goods by about a third to €160 billion, according to Bloomberg Economics. That’s a rise equivalent to more than 1% of GDP.
The private sector has also held back. Expenditures on machinery are more than 9% below pre-pandemic levels. A recent survey among family-owned companies showed nearly half aren’t even planning to replace what breaks, blaming bureaucracy and unpredictable policies. That’s effectively a no-confidence vote in an economy fighting to retain its status as third-largest in the world. Continue reading The collapse of Germany shocks many











