The International Monetary Fund expects Germany to achieve only comparatively low growth rates in the coming years. This year, the economy is likely to stagnate, then grow by one to two percent from 2024 to 2026, according to an IMF analysis of Germany's economic prospects published on Tuesday. In the long term, average growth is likely to be below one percent again.
In the short term, high energy prices are weighing on many companies. In the long term, the ageing population, lack of production growth and bottlenecks in the labour market would have a negative impact.
"There is a lot of uncertainty"
"There is a great deal of uncertainty," said the IMF experts who gathered information in Germany in the first half of May. Inflation will remain high, but at least decline. At the end of the year, an inflation rate of around 4.5 percent is expected, after 7.6 percent in April. So-called core inflation, excluding volatile energy and food prices, is likely to decline later and more slowly.
Fiscal policy must still be cautious this year so as not to fuel inflation. The aid measures to cushion high energy prices could benefit poorer sections of the population in a more targeted manner.
At the same time, the IMF emphasized that Germany has so far come through the energy crisis well after Russia cut off its gas supplies. Politicians have given the right answers and the fact that the winter has been mild has also helped.
The day before, the EU Commission had already presented its spring forecast. She sees the economic outlook for the eurozone somewhat rosier than in winter – but not for Germany. From Brussels' point of view, the Federal Republic of Germany is one of the worst performers in terms of economic dynamism this year, according to the spring forecast. Only Estonia, with a gross domestic product (GDP) of minus 0.4 percent, is worse off than Germany and Finland, both of which are expected to achieve meager growth of 0.2 percent. The German government expects growth of 0.4 percent, which is twice as strong.