Germany’s GDP and foreign trade are in decline, but there is still no recession

Based on the results of 2023, Germany’s GDP decreased by 0.3%. This preliminary estimate was given by Destatis, the country’s federal statistical office. However, the technical recession (contraction of the indicator for two consecutive quarters) is not yet fixed: in the third quarter, the German economy showed no growth.

The industrial production volume in Germany in 2023 decreased by 2% compared to the previous year’s result. An increase was observed in the production of automobiles and transportation equipment, while a decline was recorded in industries more sensitive to fluctuations in energy prices, including the chemical and metallurgical industries.

The moderate global economic recovery impacted the German foreign trade statistics: in 2023, the imports decreased by 3% and the exports decreased by 1.8%.

The Bundesbank also explains the deterioration in Germany’s GDP growth forecasts by the weakness of global demand: the current forecast implies economic growth of 0.4% in 2024 and 1.2% in 2025 (according to the previous forecast, an increase of 1.2% and 1.3% was expected, respectively).