Germany's economy 'falling behind, getting poorer' - Minister
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Germany's industrial production data to be released this week is expected to arrive at its lowest level since 2008.
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German Chancellor Olaf Scholz (R), Economy and Climate Minister Robert Habeck and Finance Minister Christian Lindner (L) at the Bundestag in Berlin, Germany, November 28, 2023. (AP)
While speaking at a Bloomberg event in Frankfurt, German Finance Minister Christian Lindner stated on Monday that the country's inability to generate growth in the economy is bringing more poverty.
Lindner, the leader of Germany's Free Democratic Party, expressed, “We are no longer competitive...We are getting poorer because we have no growth. We are falling behind.”
This comes shortly after an outlook was published by the Organisation for Economic Cooperation and Development (OECD), which showed its forecast for German growth this year went down to only 0.3% - below the 2.9% anticipated for the G20, and even lower than the 0.6% it expects for the Eurozone.
In the meantime, the industrial production data to be released this week is expected to arrive at its lowest level since 2008.
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“It is inconceivable to me that the government does not draw any conclusions from this analysis,” Linder continued, as he highlighted Germany’s social obligations, such as “the status quo of social security,” environmental projects, and increasing expenses for external security - all which “can only be realized with more economic prosperity, not otherwise.”
Standing by their word
Last month, the Federal Statistics Office reported a 0.3% shrinkage in Germany's Gross Domestic Product (GDP) over 2023.
Ruth Brand, the president of the statistics office, remarked, "Overall economic development faltered in Germany in 2023 in an environment that continues to be marked by multiple crises."
"Despite recent price declines, prices remained high at all stages in the economic process and put a damper on economic growth," Brand said. "Unfavourable financing conditions due to rising interest rates and weaker domestic and foreign demand also took their toll."
Back in August, Lindner pledged to tackle the nation's public debt after it rose to 66-67% of GDP, surpassing the EU's debt-to-GDP reference value of 60%.
"Our debt burden stands at 66-67% of GDP. It stood at 59% before the pandemic … But I promise that my goal is to bring us back to the pre-crisis level of 59-60% while I am still in office," Lindner said.
At the end of 2022, Germany's public debt reached 2.4 trillion euros ($2.6 trillion) and the increase was largely owed to pandemic costs and the energy crisis.
