Published by Global Banking & Finance Review®
Posted on April 15, 2026
2 min readLast updated: April 15, 2026
Add as preferred source on GoogleGermany isn’t directly involved in the Iran war, but its economy is taking a hit through higher energy prices, disrupted supply chains and downward revisions to growth forecasts by IMF and domestic institutes.
By Christian Kraemer
WASHINGTON, April 15 (Reuters) - Although Germany is not involved in the Iran war, the country is feeling its economic impact directly, German Finance Minister Lars Klingbeil said on Wednesday.
Asked about the government's forecasts which will be presented next week, Klingbeil said they are in preparation and he could not comment on them.
"But what we can already see now is that this war is also harming us in Germany in terms of economic growth," he said in Washington on the sidelines of the International Monetary Fund (IMF) spring meetings.
The IMF cut Germany's growth forecasts for this year and next on Tuesday, projecting growth rates of 0.8% in 2026 and 1.2% in 2027, down 0.3 percentage points from its previous forecasts for both years.
Klingbeil criticised the war in the Middle East and advocated diplomacy with Iran to stop the nuclear race instead of military action.
"I'm not convinced that having a conflict all over the region is the right way," Klingbeil said, adding he hopes diplomatic channels will lead to a lasting and viable peace solution in the Middle East.
CRISIS STRENGTHENS NEED FOR REFORMS
The minister said structural reforms are the answer to all the crises the country is experiencing, as they will make Germany fit for the challenges of the future.
Germany's coalition government agreed on Monday a package of fuel price relief for consumers and businesses worth 1.6 billion euros ($1.9 billion).
He said responding to the consequences of the war in Iran and implementing structural reforms are not mutually exclusive.
"On the contrary, it is precisely because we want to move away from dependencies, precisely because we want to become more resilient, stronger, and more sovereign, that we must also pursue the path of consistent reform in our country," Klingbeil said.
(Reporting by Christian Kraemer, writing by Maria Martinez, editing by Linda Pasquini and Keith Weir)
No, Germany is not participating in the Iran war, but it is experiencing economic consequences from the conflict.
The Iran war is harming Germany's economic growth, according to the German Finance Minister.
German Finance Minister Lars Klingbeil commented on the situation during the IMF spring meetings in Washington.
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