Wednesday, September 27, 2023
HomeEconomyWar hit on German economy to last for years - Economist

War hit on German economy to last for years – Economist

BERLIN (Reuters) – The economic impact of Russia’s invasion of Ukraine on Germany will last for several years, Marcel Fratzscher, an influential economist at the German Economic Research Institute, told Reuters, adding that it could lose 3 percentage points this year. growth of.

Fratzscher, whose institute advises governments in Europe’s largest economy on macroeconomic policy, said the effects could last until 2025, when Germany Expect to get rid of all risk exposure. Russian gas.

Germany, which has prospered for decades on a reliable supply of cheap Russian gas, is eager to adjust its course after the outbreak of war in February.

“The Ukrainian war has done enormous damage to the German economy,” Fratzcher said in an interview, adding that the 4.5 percent economic growth he projected at the beginning of the year may only be left. 1.5%.

The impact of high energy prices on inflation will continue for a similar period, although he rejects the suggestion that wages are justified.

“Unions are not as strong as they were in the 1970 years,” he said, noting that this year’s forecast wage growth of 4.5 percent is well below inflation of around 8 percent . “Even in the next few years, I don’t see any sign that we are in a wage spiral.”




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