The largest economy of Europe, Germany, experienced a growth of 1.5% last year as compared to a 2.2% growth rate in 2017, which was the slowest since 2013, according to reports by Federal Statistics Office. This may be due to reduced demands for cars, weaker worldwide economy and newest pollution standards. Lower water levels, especially in Rhine, also contributed to slow economic rise. The German economy was expected to see a growth of 1.8%. Amid global trade disputes, German economy in the 3rd quarter had fallen by 0.2%. Another quarter of negative growth would mean recession, which hopefully did not happen as independent economists predict 0.2% growth rate in last 3 months of the year. However, official reports are not available yet due to lack of enough information. When reports and figures are officially released by the statistics office, it might alter the conclusion that Germany has not plunged into recession.
Germany’s economy hit a rough patch in the 2nd half of 2018. But it was not the only country to do so. Most of the European nations experienced slow growths in their markets during 3rd quarter of 2018. Apart from Germany, Italy, another large economy in the eurozone, also contracted during that period of time. France and Spain however managed to keep their market growths reasonably steady and firm. As Germany is one of the leading exporters in the world, global trade climate affects it particularly. Additionally, China is the 3rd biggest market for Germany’s exports, and slowing Chinese economy further contributed to the slow economic growth of Germany. This is the first time in the past 6 years that export orders to China have fallen so steeply. Worsening the situation was export orientation of Germany, making it vulnerable to trade conflicts between the US and China.
It is important to note that despite probable problems that Germany might face, unemployment is significantly low presently. Economist Claus Vistesen said that even though Germany might have stayed clear of a recession, its economy had lost pace.###