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Germany has been branded \u201csick man of Europe\u201d as forecasts from the International Monetary Fund (IMF) suggest the country\u2019s economic woes are likely to continue for the foreseeable future.<\/p>\n
The IMF predicts the nation\u2019s economy will shrink in 2023 which would make it the only G7 country to contract this year.<\/p>\n
In the first quarter of 2023, Germany fell into recession after two consecutive quarters of negative economic growth while post-Brexit Britain grew by 0.2 percent in this year\u2019s second quarter.<\/p>\n
In 1998, Germany previously held the moniker of the \u201csick man of Europe\u201d as the country struggled with the challenges that arose from the reunification of East and West.<\/p>\n
But in Britain, the term is most widely associated with the UK’s decline in the 1970s.<\/p>\n
Don’t miss… Fixed energy deals trap warning as bill payers may get better deal if they wait<\/strong><\/p>\n Among the issues impacting Europe\u2019s biggest economy are high inflation and an industrial slowdown.<\/p>\n According to the federal statistics agency Destatis, Germany\u2019s economy registered zero growth from April to June compared to the previous quarter.<\/p>\n This is despite Chancellor Olaf Scholz\u2019s Government doubling the country\u2019s growth forecast earlier this year.<\/p>\n Rising eurozone interest rates and China\u2019s faltering economy are particularly causing trouble for the G7 nation, with the latter being Germany\u2019s biggest trading partner.<\/p>\n ING economist Carsten Brzeski said Germany’s poor economic figures will “do very little to end the debate on Germany being the new sick man of Europe”.<\/p>\n Richard Flax, the chief investment Officer at Moneyfarm, warned that Germany\u2019s economic stagnation should be concerning for the wider global economy.<\/p>\n He explained: \u201cGermany\u2019s economy stagnated in quarter two, in line with expectations, raising the prospect for a recession in the second half of the year.<\/p>\n \u201cThere have been no changes to the initial estimates, with the final reading matching the preliminary data at 0.0 percent quarter-on-quarter and -0.2 percent year-on-year.<\/p>\n \u201cThis will be concerning as Germany is the biggest economy in Europe, the fourth largest globally, and is the third largest exporter in the world after China and the US.\u201d<\/p>\n We use your sign-up to provide content in ways you’ve consented to and to improve our understanding of you. This may include adverts from us and 3rd parties based on our understanding. You can unsubscribe at any time. More info<\/p>\n The investing expert highlighted how the country\u2019s changing relationships with other nations have led to it taking a hit financially.<\/p>\n Mr Flax added: \u201cThe economic weakness in Germany has been defined by a slump in trading with China \u2013 its biggest partner, a decline in manufacturing and construction sectors, and exacerbated by the decoupling from Russia \u2013 which had been a source of cheap energy.<\/p>\n \u201cThe economic weakness from Germany is threatening to seep into the wider Eurozone as high-interest rates increase the pressure on other better-performing economies within the block.<\/p>\n \u201cThis adds pressure on the ECB to consider a pause in September, after having previously ruled it out.”<\/p>\nHugh Grant says Brexit has ruined his country<\/h3>\n
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