Covid-19: German economy shrinks, country slides into recession

by MCR Correspondent

The fight against coronavirus pandemic in Germany has impacted the country’s economy, tipping it into acute recession.

According to the official data released on Friday May 15, 2020, Europe’s top economy is currently suffering its quarterly contraction in more than a decade, following the lockdown measures.

According to federal statistics agency, the German economy has shrunk by 2.2 percent in the first quarter of 2020.

“The quarter-on-quarter decline is the worst since the global financial crisis in 2009,” the agency revealed.

The agency also revised its gross domestic product (GDP) figure for the final quarter of 2019 from zero growth to a contraction of 0.1 percent. That means Germany has now experienced two consecutive quarters of decline, meeting the technical definition of a recession.

The worst is yet to come however, with economists warning that the full impact from the coronavirus restrictions will be felt more in the second quarter.

Coronavirus lockdowns have upended the German economy, with many firms such as resaurants forced to close

While reacting to the economic reality the country battles, Economy Minister, Peter Altmaier, once warned that Germany was headed for “the worst recession” in its post-war history as the pandemic brought huge swathes of the economy to a standstill.

Like other European countries, Germany closed factories, shops, schools and restaurants from mid-March and asked workers to stay at home to help curb the outbreak.

“Private consumption, exports and investments in equipment shrank considerably as a result,” the German economy ministry said in a statement.

You may also like

Leave a Comment