As of: February 21, 2024, 3:15 p.m
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A container ship at the port of Hamburg: The German economy is going through difficult times.
© Daniel Bockwoldt/dpa
Inflation, a shortage of skilled workers and a wave of strikes are depressing the German economy.
Economists, like the government, are therefore dampening their expectations for 2024.
Berlin – In the spring, economists will lower their growth forecasts for this year, similar to the federal government.
“I think we will definitely go in the same direction,” said economist Ulrike Malmendier in an interview with the Reuters news agency published on Wednesday.
“That’s what our numbers currently indicate.” The five economies used their own calculation model, which already takes the state’s lower spending into account.
An updated forecast is announced for mid-May.
So far, the Council of Experts, which advises the federal government, expects growth of 0.7 percent in 2024.
The cabinet is scheduled to approve the annual economic report this Wednesday.
As is already known, the growth forecast for this year will be cut from 1.3 to 0.2 percent.
Some experts even believe a second year of recession in a row is possible.
Malmendier: Germany absolutely needs immigration
According to the Bundesbank, the German economy is at risk of another decline in gross domestic product in the current first quarter.
Europe's largest economy had already shrunk by 0.3 percent in the fourth quarter of 2023.
Two negative quarters in a row are considered a technical recession.
Malmendier said there are many indications that this will happen.
“These are not the numbers to be happy about.” Among other things, the economist, who teaches at Berkeley University in California, referred to the recent wave of strikes in Germany.
In the medium to long term, the prospects are not rosy.
The number of hours worked is declining.
The population is old and the younger generation wants to work less.
The only thing that helps here is immigration, “to be honest, the immigration of any worker who wants to work in Germany,” said Malmendier.
The problem cannot be solved with domestic workers and more working hours for women alone.
“That won't be enough.
We need migration.”
More incentives for investments
Germany also needs to provide more incentives for investments, for example with additional depreciation options and less bureaucracy.
The government should also not only focus on traditional industries, such as mechanical engineering, automobiles and chemicals.
Young companies in the areas of artificial intelligence, biotech or environmental technology must be supported.
“Germany has to rely on that now.
And we’re not used to that.”
(reuters, lf)