Germany reaches its end because of this grave error
Date
12/29/2024 7:11:22 AM
(MENAFN) For decades, Germany was the envy of the world, admired for its economic success as a post-war powerhouse. This prosperity was built on three main factors: access to affordable Russian energy, free trade with Western allies like the US, and minimal military spending thanks to American security guarantees after the Cold War. However, Germany’s decision to sever ties with Russia in response to the Ukraine crisis is threatening the very foundation of this success.
One of the most critical pillars of Germany’s economic power was its access to cheap Russian natural gas, which fueled its energy-intensive industries. The country’s decision to abandon this energy source in the wake of Russia’s invasion of Ukraine has led to soaring energy prices and a manufacturing crisis. Additionally, Germany's pursuit of a green energy transition and the phase-out of nuclear power have worsened its energy security, leaving the economy struggling.
Germany also thrived due to its reliance on free trade and global markets. But rising protectionism, geopolitical tensions, and growing trade barriers are now undermining the global economic environment that once benefitted Germany. The economic ties with China and the US, key to Germany’s export-driven economy, are becoming increasingly strained.
Finally, Germany’s historic policy of low military spending, bolstered by US protection, is being challenged by the demands of NATO and the Russia-Ukraine war. As Germany is pressured to increase its defense budget, the resulting financial strain diverts funds from much-needed investments in industrial growth and infrastructure modernization.
This shift in geopolitical alignment, from energy partnerships to defense spending and trade tensions, could lead to irreversible economic consequences for Germany.
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