The German Institute for Economic Research, DIW, sees the German economy already in the midst of a recession, Guido Baldi, DIW economic expert, said.
Baldi on Wednesday said the war in Ukraine instigated by the Russian president and its far-reaching consequences were likely to lead to growth losses in Germany of a roughly estimated five per cent of gross domestic product in 2022 and 2023.
He said the enormous increase in energy prices would lead to “dramatic losses in purchasing power” and threaten to make production unprofitable for many companies.
“Price increases for energy on the one hand, and uncertainty on the other, are dampening real sales and business expectations.
“For some companies, the question could soon arise whether it is currently worthwhile to maintain production at all,” another DIW expert, Laura Pagenhardt, said.
dpa/NAN
