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Experts: Germany could face severe recession if there is a halt to gas or oil supplies from Russia

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Europe’s largest economy is heavily dependent on energy imports from Russia, and the country’s banks, along with industry groups, have expressed concerns about possible supply disruptions.

Christian Sewing, CEO of Deutsche Bank, said as chairman of BDB that financial institutions expect a much slower growth this year of about 2% due to the war in Ukraine.

“The situation could worsen if imports or supplies of gas and oil from Russia are stopped. A significant recession in Germany would then be inevitable, “Sewing told reporters.

“The issue of government support measures for companies and sectors will then become even more urgent,” the source was quoted as saying.

Sewing again called on the ECB to act to combat inflation.

According to preliminary data released by Eurostat on Friday, the annual inflation rate in the euro area reached a record high of 7.5% in March, from 5.9% in February, while analysts estimated a level of 6.7% for the month past. It is a record high for the euro area and far exceeds the European Central Bank’s (ECB) target of 2%.

Read:   Renault, the only major automaker in the world, has decided not to stop trade with Russia and has not stopped production at factories in that country.

Sewing said the ECB should close the asset purchase program soon and provide an indication of interest rates.

“An indication is urgently needed,” the BDB chairman said.

On Monday, German Economy Minister Robert Habeck said his country was working to impose an embargo “with measures that would affect Putin on a daily basis” and aimed at independence from Russian gas, coal and oil, the BBC reported.

“We are working to impose an embargo, with measures that will affect Putin on a daily basis. We are on the right track and this week we will make more progress in this regard, “said Habeck.

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“We are working for independence from Russian gas, coal and oil,” the German economy minister said.

Habeck claims that before Russia’s invasion of Ukraine, 35% of Germany’s oil came from Russia, and currently imports only 25%. Earlier, the German official said that since the beginning of the Russian invasion, Germany’s dependence on Russian gas has decreased from 55% to 40%.

New sanctions against Russia will be decided this week as a result of atrocities in Bukea and other parts of Ukraine, he said.

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