Kathmandu. Germany’s economy is projected to contract by 0.2% in 2025. According to a report released on Tuesday by the German Economic Institute (IW) in Cologne, Germany will lag behind other major economies of the world.
After two consecutive years of decline in the economy, Us trade policy, global uncertainty and low levels of investment are the main challenges to the German economy.
While other large economies appear to be on track to recover this year, the IW report says Germany will remain in recession. The report points to US trade policy as one of the biggest risks to the global economy, predicting a 0.8 per cent drop in global output.
This economic crisis will also have an impact on the job market. By the summer of 2025, the number of unemployed is expected to reach three million. “The German economy is in deep crisis,” IW warned in a statement published in April. ”
According to the organization, one in three companies plan to cut investment, while about 35 percent of companies are preparing to reduce manpower. The organization said that the new federal government needs to revive the economy and face structural challenges by taking immediate and effective steps as soon as possible.
Another report published by the German central bank in late April also showed the state of the economy to be even more negative. Although there was a slight improvement in the first quarter, there is a possibility of a recession again in the second quarter. Overall, the future of the German economy is still uncertain and worrisome.
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