The war in Ukraine also burdens Germany. High energy prices and delivery bottlenecks are putting pressure on the economy. DIW President Fratzscher puts the growth losses in 2022 at 100 billion euros.
The President of the German Institute for Economic Research (DIW), Marcel Fratzscher, expects the Ukraine war to continue to increase costs for the German economy and high growth losses. "The Ukraine war and the associated explosion in energy costs cost Germany almost 2.5 percent or 100 billion euros in economic output in 2022," Fratzscher told the Rheinische Post. These costs would continue to increase in the coming years.
"Germany is economically more affected by the crisis because it was more dependent on Russian energy, has a high proportion of energy-intensive industry and is extremely dependent on exports and global supply chains," said the President of the German Institute for Economic Research (DIW).
"Damage to Germany as a business location has not yet occurred, but will occur if companies do not massively accelerate the ecological, economic and digital transformation." Because higher energy prices would remain a clear competitive disadvantage in the next ten years, so that politicians and companies would have to compensate for this with higher innovation and productivity.
"The federal government should under no circumstances continue down the path of massive subsidies for fossil fuels," said the Berlin economist. "The energy price shock is therefore a painful but also a necessary wake-up call that will hopefully lead to a faster transformation of the economy." The German Chamber of Industry and Commerce (DIHK) has put the economic loss of prosperity - from the beginning of the war to the end of 2023 - at around 160 billion euros or around 2000 euros per capita. This is around four percent of the gross domestic product, said DIHK President Peter Adrian the newspaper.
