Challenges Facing Germany's Economy

Germany's economy is predicted to be the only one in the G7 to contract this year, partly due to its exposure to unique circumstances such as the trade war and the slowdown in China. Interest rates have risen, hurting construction and business investments, while consumer struggles are evident in stagnant real wages. Germany's industrial sector is vulnerable to geopolitical rivalry, the switch to net zero emissions poses challenges, and it faces an elderly workforce. Furthermore, the German state is ill-prepared to address these issues.