German government: Economy to shrink in 2023 as war bites
The German government has slashed its growth forecast for this year and predicted that Europe’s biggest economy would shrink in 2023 as it deals with the fallout from Russia’s war in Ukraine, including Moscow cutting off natural gas supplies
BERLIN (AP) — The German government on Wednesday slashed its growth forecast for this year and predicted that Europe's biggest economy would shrink in 2023 as it deals with the fallout from Russia's war in Ukraine, including Moscow cutting off natural gas supplies.
The Economy Ministry said it expects Germany's gross domestic product to grow by 1.4% this year and then decline by 0.4% next year. In late April, it had forecast 2.2% growth in 2022 that would accelerate to 2.5% next year.
Since then, the impact of the war has deepened, with energy prices stubbornly high and Germany's annual inflation rate hitting 10% in September.
Russia, which was long Germany's main supplier of natural gas, started reducing supplies through the main Nord Stream 1 pipeline in June and halted them entirely at the end of August. Still, Germany's gas storage facilities are nearly 95% full, and officials say the country is well-placed to get through the winter — though efforts to save gas will be necessary.
