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German economy to lose $265 billion in added value due to war, high energy prices-study
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BERLIN (Reuters) – Germany’s economy will lose more than 260 billion euros ($265 billion) in added value by 2030 due to the Ukraine war and high energy prices, spelling negative effects for the labour market, according to a study by the Institute for Employment Research (IAB).
BERLIN (Reuters) – Germany’s economy will lose more than 260 billion euros ($265 billion) in added value by 2030 due to the Ukraine war and high energy prices, spelling negative effects for the labour market, according to a study by the Institute for Employment Research (IAB).
In comparison with expectations for a peaceful Europe, Germany’s price-adjusted gross domestic product (GDP) will be 1.7% lower next year and there will be about 240,000 fewer people in employment, said the study published on Tuesday.
The employment level is expected to stay at around this level until 2026, when expansive measures will gradually begin to outweigh the negative effects and lead to a plus of about 60,000 gainfully employed in 2030.
One of the big losers will be the hospitality industry, which was already hit hard by the coronavirus pandemic and is likely to feel the pinch of consumers’ waning purchasing power.
Energy-intensive sectors, such as the chemical industry and metal production, are also especially likely to be affected.
If energy prices, which have so far shot up by 160%, were to double again, Germany’s 2023 economic output would be almost 4% lower than it would have been without the war, according to the study. Under these assumptions, 660,000 fewer people would be employed after three years and still 60,000 fewer in 2030, it said.
($1 = 0.9809 euros)
(Reporting by Christian Kraemer, Writing by Miranda Murray, Editing by Kirsti Knolle)
Employment opportunities refer to the availability of jobs in a specific market or economy, indicating the potential for individuals to find work and contribute to economic growth.
Economic growth is the increase in the production of goods and services in an economy over time, typically measured as the percentage increase in real GDP.
A financial crisis is a situation in which the value of financial institutions or assets drops significantly, often leading to widespread economic instability and loss of confidence in the financial system.
Energy prices refer to the cost of energy sources such as oil, gas, and electricity, which can significantly impact economic conditions and consumer spending.
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