Overview
- The ifo Institute now projects German GDP growth of 0.1% in 2025, 0.8% in 2026 and 1.1% in 2027, marking a cut from its autumn forecast.
- Ifo economists warn potential growth could sink toward zero by decade’s end and turn negative in the 2030s without structural reforms and a larger labor supply.
- The modest upturn factors in government investment effects—about 0.3 percentage points in 2026 and 0.7 in 2027—yet ifo judges these measures as only short‑term relief.
- Ifo president Clemens Fuest says the recovery is largely bought with high new debt, with the state expanding as the private sector contracts.
- Official data show 18,125 corporate insolvency filings from January through September, up 11.7% year on year, while exporters continue to lose market share despite a global upswing.