Germany faces a bleak future with waves of bankruptcies and unemployment in light of high inflation and gas shortages

Several German newspapers confirmed that the sharp rise in prices and the lack of energy resources, will lead to a decline in the German economy and cause a wave of bankruptcies and unemployment, as a result of sanctions against Russia.

Data from the country’s economic research institutes, reveals that in 2023 Germany’s gross domestic product will shrink by 0.7-1.4%.

Experts from the Institute of World Economics (IME) said: “The German economy is in a recession… Rapidly rising energy prices are putting pressure on the economy and pushing it into recession”.

For his part, the head of the German company Uniper urged to prepare for the “worst case scenario” with gas, “the difficult situation can only affect companies… Business prospects have become bleaker”.

In August, the number of bankruptcies rose by 26% compared to the same period last year and amounted to 718 cases, and in September analysts expect this number to increase by a quarter.

“For a long time, the number of bankruptcies has been low, but now there has been a turn for the worse,” said economist Stephen Mueller.

Western countries, including Germany, are facing a sharp rise in energy prices and inflation rates as a result of the sanctions it imposed against Russia, and the policy of abandoning Russian fuel.

Because of rising fuel prices, especially gas, industry in the West has largely lost its competitive advantages, which has also affected other sectors of the economy.