Uncertain Times: Germany Faces Economic Stagnation Amid Tariff Threats

The German government revises its economic forecast, predicting stagnation in 2025 due to global trade disputes. With tariff threats from the U.S., Germany faces possibly a third year of stagnant growth, prompting calls for EU-U.S. trade solutions and potential countermeasures. Export-driven challenges continue amid uncertain global demand.

The German government has revised its economic growth forecast, now anticipating stagnation in 2025 rather than the previously expected 0.3% expansion. This adjustment results from the ongoing uncertainty caused by global trade disputes, which threaten to restrain growth and investment.

Economy Minister Robert Habeck urges for collaboration between the European Union and the U.S. to resolve trade issues, emphasizing the need for the EU to be prepared with countermeasures if necessary. Germany's export-driven economy is further burdened by weak global demand and competitive pressure from foreign companies.

With U.S. tariffs on steel, aluminum, and cars, Germany faces the risk of three consecutive years without growth, unprecedented among G7 nations. Despite these challenges, a recent survey suggests a slight improvement in German business morale, amid lingering concerns over U.S. protectionism.

(With inputs from agencies.)