The clouds of gloom are gathering
The slowdown in the economy poses a political challenge to Germany’s chancellor, Gerhard Schröder
“THERE is no cause for panic,” Germany's normally unruffled chancellor, Gerhard Schröder, says grimly, implying that some think otherwise. Not since 1996 has the outlook for Europe's biggest economy been so gloomy. According to Ifo, a Munich-based research institute, Germany can expect growth of no more than 1.2% this year. There is even talk of recession. Unemployment has been rising relentlessly for the past five months. Inflation in May reached an annual rate of 3.5%, its highest since 1993. Industrial production is tumbling. Business confidence is at its lowest in two years. And a general election is due in just over a year.
This article appeared in the Europe section of the print edition under the headline “The clouds of gloom are gathering”
From the June 30th 2001 edition
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