Germany’s economic growth challenges

According to the Economist Intelligence Unit, the German growth model has historically relied on globalisation and cheap energy inputs to fuel rising wages and living standards.
Germany’s economy is highly export oriented and strongly interlinked with the US and Chinese markets.

However, structural challenges and geopolitical headwinds are threatening the viability of this growth model. Protectionism is on the rise, and Russia’s invasion of Ukraine has elevated energy costs.

These issues will weaken Germany’s growth outlook, but the country can counterbalance this by leveraging its skilled workforce and high-tech infrastructure with new green and digital investments.