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Germany’s economy is in bad shape, says finance minister

ByEditor

Feb 13, 2024

German Finance Minister Christian Lindner spoke at the London School of Economics and addressed the state of the German economy. He rejected the notion of Germany being the “sick man of Europe,” instead stating that it was an “unfit man” in need of structural reforms to improve its competitiveness.

Despite being Europe’s largest economy, Germany performed the weakest among its large euro zone peers in the previous year. Factors such as high energy costs, lackluster global orders, and record-high interest rates contributed to this economic downturn. As a result, some economists referred to Germany as “the sick man of Europe.”

The data supports this view, as the IMF predicted that German economic growth would fall well below the average for advanced economies in 2024. With a projected growth rate of 0.9%, Germany lags behind the 1.4% average of its peers.

Lindner likened the German economy to a “tired man” in need of a boost in the form of structural reforms. These reforms would include reducing red tape, encouraging increased labor market participation, and mobilizing private investment within the country.

In addition, Lindner advocated for the development of a single capital market for private investment across the EU instead of relying on subsidies. This, he believes, would provide greater economic stability compared to extended subsidy payments.

By Editor

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