Germany Seeks New Economic Partnerships Amid Crumbling Alliances

Germany's Shift in Economic Alliances

BERLIN, Jan 27 (Reuters) - Germany must seek new partners in light of a changing global order, the country's economy minister said on Tuesday, referring to deteriorated relations with the United States that have resulted in painful import tariffs.

Challenges in Current Alliances

"The world has become more uncertain, and alliances that we have trusted and relied on are beginning to crumble," Katherina Reiche said at the Handelsblatt energy summit.

Potential New Partners

"That does not mean abandoning them, but rather continuing to work together, however challenging that may be in some cases, and above all seeking new partners."

Economic Growth Forecasts

In particular, Reiche mentioned South America, India, the Middle East, Canada, Australia as well as countries in Asia, including Malaysia.

Her comments reflect growing uncertainty over what role the United States will play in the future after President Donald Trump's imposition of tariffs on key allies such as Canada and the European Union.

Finding new economic alliances would also play a key role in boosting Germany's economy, Europe's biggest, which Reiche said expected two years of growth only due to debt-funded investments in defence and infrastructure.

"We are talking about 1%, 1.5%," of gross domestic product (GDP) growth, she said. "This is not sustainable."

The German government is on Wednesday expected to lower its growth forecast in 2026 to 1.0% from 1.3% of GDP, a person familiar with the matter said last week, while GDP growth in 2027 is seen at 1.3%.

(Reporting by Christoph SteitzEditing by Ludwig Burger, Aidan Lewis)