DThe EU Commission has a similarly pessimistic view of the German economy as the Federal Minister of Economics. In its winter forecast published on Thursday, the Brussels authority still expects real gross domestic product (GDP) to grow by 0.3 percent this year, i.e. practically stagnation. This means that it is correcting its forecast from November downwards by 0.5 percentage points.
In the Commission forecast, Germany remains the country with the worst prospects for the current year. Of course, the authority is more pessimistic for the entire euro area than it was in November. According to the Commission, GDP in the monetary union will grow by 0.8 percent, a downward correction of 0.4 points compared to the previous forecast. At the same time, it means that growth in the euro area remains weak for the second year in a row. In 2023 the growth rate there was 0.5 percent.
Federal Economics Minister Robert Habeck (Greens) announced for Germany on Wednesday that the federal government would reduce its forecast for 2024 from 1.3 to 0.2 percent. Last year the German economy shrank by 0.3 percent.
For 2025, the commission expects growth of 1.2 percent in Germany. This also means that the three largest economies will have the weakest growth. The Commission expects growth of 1.5 percent for the entire euro area. EU Economic and Monetary Affairs Commissioner Paolo Gentiloni cited geopolitical tensions, an “even more unstable climate” and a series of important elections around the world as reasons for uncertainty “around this forecast” to continue to rise.
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