German government cuts economic forecast, sees 2.2% growth

Apr 27, 2022, 6:11 AM | Updated: 7:34 am

BERLIN (AP) — The German government forecast Wednesday that the country’s economy, Europe’s biggest, will grow by only 2.2% this year as Russia’s war in Ukraine weighs on prospects.

The Economy Ministry chopped the outlook for gross domestic product from the 3.6% growth it forecast in January. It sees only slightly faster growth of 2.5% in 2023.

The government’s revised outlook was gloomier than a recent assessment by leading economic think tanks that expected the economy to expand by 2.7% this year.

But the government outlook was more optimistic than a prediction of 1.8% growth by its own panel of independent economic advisers. Last year, Germany’s GDP grew by 2.9%.

Economy Minister Robert Habeck said the government was making a “conservative” estimate, pointing to still-fragile supply chains, the effect of sanctions against Russia on the availability of raw materials and the ongoing effects of the coronavirus pandemic.

The 2.2% growth prediction assumes no energy embargo or blockade of gas deliveries, Habeck said. “If this came on top, we would have a recession in Germany,” he said.

Russian imports account for a significant, though declining, proportion of Germany’s gas supplies. Habeck said that proportion has declined from 55% before the war to 35% now.

Chancellor Olaf Scholz’s Cabinet on Wednesday approved a package of measures designed to ease the strain on consumers of higher energy prices. It includes lowering the tax on gasoline, cheap tickets for public transportation and one-off payments of several hundred euros to each taxpayer.

The cost to the public purse was estimated at “significantly more” than 30 billion euros ($32 billion), government spokesman Steffen Hebestreit told reporters.

Copyright © The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


(Facebook Photo/City of San Luis, Arizona)...
Associated Press

San Luis authorities receive complaints about 911 calls going across border

Authorities in San Luis say they are receiving more complaints about 911 calls mistakenly going across the border.
5 days ago
(Pexels Photo)...
Associated Press

Daylight saving time begins in most of US this weekend

No time change is observed in Hawaii, most of Arizona, Puerto Rico, the U.S. Virgin Islands, American Samoa, Guam and the Northern Marianas.
13 days ago
Mexican army soldiers prepare a search mission for four U.S. citizens kidnapped by gunmen in Matamo...
Associated Press

How the 4 abducted Americans in Mexico were located

The anonymous tip that led Mexican authorities to a remote shack where four abducted Americans were held described armed men and blindfolds.
13 days ago
Tom Brundy points to a newly built irrigation canal on one of the fields at his farm Tuesday, Feb. ...
Associated Press

Southwest farmers reluctant to idle farmland to save water

There is a growing sense that fallowing will have to be part of the solution to the increasingly desperate drought in the West.
20 days ago
A young bison calf stands in a pond with its herd at Bull Hollow, Okla., on Sept. 27, 2022. The cal...
Associated Press

US aims to restore bison herds to Native American lands after near extinction

U.S. officials will work to restore more large bison herds to Native American lands under a Friday order from Interior Secretary Deb Haaland.
20 days ago
Children play in a dried riverbed in Flassans-sur-Issole, southern France, Wednesday, March 1, 2023...
Associated Press

Italy, France confront 2nd year of western Europe drought

ROME (AP) — Bracing for Italy’s second consecutive year of drought for the first time in decades, Premier Giorgia Meloni huddled with ministers Wednesday to start mapping out an action plan Wednesday, joining France and other nations in western Europe grappling with scant winter rain and snow. Meloni and her ministers decided to appoint an […]
22 days ago

Sponsored Articles

(Pexels Photo)...

Sports gambling can be fun for adults, but it’s a dangerous game for children

While adults may find that sports gambling is a way to enhance the experience with more than just fandom on the line, it can be a dangerous proposition if children get involved in the activity.
Fiesta Bowl Foundation

Celebrate 50 years of Vrbo Fiesta Bowl Parade magic!

Since its first production in the early 1970s, the Vrbo Fiesta Bowl Parade presented by Lerner & Rowe has been a staple of Valley traditions, bringing family fun and excitement to downtown Phoenix.
(Desert Institute for Spine Care photo)...

Why DISC is world renowned for back and neck pain treatments

Fifty percent of Americans and 90% of people at least 50 years old have some level of degenerative disc disease.
German government cuts economic forecast, sees 2.2% growth