Seven-month drop: Industrial production in Germany fell another 1.6% in December
Germany reinforced its status as “Europe’s sick man” as the once-mighty industrial sector recorded its longest slump since reunification three decades ago.
Europe’s largest economy and once driving force said official data showed output fell another 1.6 percent in December.
This was the seventh consecutive monthly decline, marking the longest crisis for German industry since the early 1990s.
Production is now 10 percent below pre-pandemic levels, underscoring the crisis gripping Germany’s industrial hubs.
Melanie Debono, an economist at Pantheon Macroeconomics, called the figures “ugly” and said: “The downturn in the industry will continue.”
The sector was heavily reliant on cheap Russian gas and has been plunged into crisis since the invasion of Ukraine in February 2022 caused German energy costs to soar.
The German economy shrank 0.3 percent last year, making it the worst-performing of the G7 industrialized nations, and looks set for a further decline in 2024.
Franziska Palmas, senior European economist at Capital Economics, said: “High energy costs and weak domestic and external demand will see German industrial production fall further in 2024.”
In energy-intensive industries, production fell 5.8 percent in December. In the chemical industry, production fell 7.6 percent in the same month and construction fell 3.4 percent.