Editing Economy of Germany (section)

==History==
{{Main|Economic history of Germany}}
[[File:GDP per capita development of Germany.svg|thumb|Real GDP per capita development in Germany since 1820]]

===Age of Industrialisation===
{{Main|Industrialization in Germany}}

The [[Industrial Revolution]] in Germany got underway approximately a century later than in the United Kingdom, France, and Belgium, partly because Germany only became a [[German Empire|unified country in 1871]].<ref>Compare: {{cite book|last1= Mitchell|first1= Allan|title= Great Train Race: Railways and the Franco-German Rivalry, 1815–1914|date= 2006|publisher= Berghahn Books | url = https://books.google.com/books?id=mZ6pkm-WgWMC | pages = 54–55 | quote = There were until [1870] [...] only the beginnings of a nexus of technological innovation and economic growth, the erratic construction of a platform for what might later be justifiably termed a take-off in Germany. But there is little evidence within the given chronological framework for a full-blown notion of an Industrial Revolution [...].|isbn= 9781845451363}}</ref>
<gallery widths="90" heights="90">
File:Maschinenbau-Anstalt Borsig, Berlin Chausseestraße, 1847, Karl Eduard Biermann.jpg|Train factory of [[August Borsig]] in 1847
File:Kemna Lokomotiven.jpg|Many companies, such as steam-machine producer [[Kemna Bau|J. Kemna]], modeled themselves on English industry.
File:BASF Werk Ludwigshafen 1881.JPG|[[BASF]] plant in [[Ludwigshafen]], 1881
File:Karl Benz Automobile.jpg|The invention of the automobile. [[Bertha Benz]] and [[Carl Benz|Karl Benz]] in a Benz Viktoria, model 1894
File:4a15881u.tif|The invention of the cruise ship. [[Albert Ballin]]'s [[SS Augusta Victoria (1888)|SS ''Auguste Viktoria'']] in 1890
File:Bonn-Cölner-Eisenbahn 1844.jpg|Railway construction as an expression of the Industrial Revolution (here the [[:de:Bonn-Cölner Eisenbahn-Gesellschaft|Bonn-Cölner railway]] around 1844)
File:ZeppelinLZ127a.jpg|The LZ 127 [[LZ 127 Graf Zeppelin|Graf Zeppelin]] of [[DELAG]], the [[List of airlines by foundation|world's first airline]]<ref>{{cite web|url=http://www.airships.net/delag-passenger-zeppelins|website=airships.net  |title= DELAG: The World's First Airline|access-date=17 March 2014}}</ref>
File:Krupp works.JPG|[[Krupp]] factory in Essen, ({{Circa|1905}}), when Krupp was Europe´s largest company
</gallery>
The establishment of the ''Deutscher [[Zollverein]]'' (German Customs Union) in 1834 and the expansion of railway systems were the main drivers of Germany's industrial development and political union. From 1834, tariff barriers between increasing numbers of the [[Lesser Germany|''Kleindeutschland'']] German states were eliminated.{{citation needed|date=May 2017}} In 1835 the first German railway linked the [[Franconia]]n cities of [[Nuremberg]] and [[Fürth]] – it proved so successful that the decade of the 1840s saw "railway mania" in all the German states. Between 1845 and 1870, {{convert|8000|km}} of rail had been built and in 1850 Germany was building its own locomotives. Over time, other German states joined the customs union and started linking their railroads, which began to connect the corners of Germany. The growth of free trade and a rail system across Germany intensified economic development which opened up new markets for local products, created a pool of [[middle management|middle managers]],{{clarify|date=October 2018}} increased the demand for engineers, architects, and skilled machinists, and stimulated investments in coal and iron.<ref>Richard Tilly, "Germany: 1815–1870" in Rondo Cameron, ed. [https://books.google.com/books?id=neQ9AAAAIAAJ ''Banking in the Early Stages of Industrialization: A Study in Comparative Economic History''] (Oxford University Press, 1967), pages 151-182</ref>

Another factor that propelled German industry forward was the unification of the monetary system, made possible in part by political unification. The Deutsche Mark, a new monetary coinage system backed by gold, was introduced in 1871. However, this system did not fully come into use as silver coins retained their value until 1907.{{citation needed|date=October 2023}}

The victory of [[Kingdom of Prussia|Prussia]] and her allies over [[Napoleon III]] of France in the [[Franco-Prussian War]] of 1870-1871 marked the end of French hegemony in Europe and resulted in the proclamation of the German Empire in 1871. The establishment of the empire inherently presented Europe with the reality of a new populous and industrialising polity possessing a considerable, and undeniably increasing, economic and diplomatic presence. The influence of French economic principles produced important institutional reforms in Germany, including the abolition of feudal restrictions on the sale of large landed estates, the reduction of the power of the guilds in the cities, and the introduction of a new, more efficient commercial law. Nonetheless, political decisions about the economy of the empire were still largely controlled by a [[Marriage of Iron and Rye|coalition of "rye and iron"]], that is the [[Junker (Prussia)|Prussian Junker]] landowners of the east and the [[Ruhr]] heavy industry of the west.<ref>Cornelius Torp, "The "Coalition of 'Rye and Iron'" under the Pressure of Globalization: A Reinterpretation of Germany's Political Economy before 1914," ''Central European History'' Sept 2010, Vol. 43 Issue 3, pp 401-427</ref>

Regarding politics and society, between 1881 and 1889 Chancellor [[Otto von Bismarck]] promoted laws that provided [[social insurance]] and improved working conditions. He instituted the world's first [[welfare state]]. Germany was the first to introduce social insurance programmes including universal healthcare, compulsory education, sickness insurance, accident insurance, disability insurance, and a retirement pension. Moreover, the government's universal education policy bore fruit with Germany achieving{{when|date=October 2018}} the highest literacy rate in the world – 99% – education levels that provided the nation with more people good at handling numbers, more engineers, chemists, opticians, skilled workers for its factories, skilled managers, knowledgeable farmers, and skilled military personnel.<ref>{{cite web|url= http://www.fsmitha.com/h3/h49soc2.htm|title= Class and Politics in Germany, 1850 to 1900|url-status= live|archive-url= https://web.archive.org/web/20150423115608/http://www.fsmitha.com/h3/h49soc2.htm|archive-date= 23 April 2015}}</ref>

By 1900, Germany surpassed [[United Kingdom of Great Britain and Ireland|Britain]] in steel production and became the largest producer behind only the [[United States]]. The German economic miracle was also intensified by unprecedented population growth from 35 million in 1850 to 67 million in 1913. From 1895 to 1907, the number of workers engaged in machine building doubled from half a million to well over a million. Only 40 percent of Germans lived in rural areas by 1910, a drop from 67% at the birth of the Empire. Industry accounted for 60 percent of the gross national product in 1913.<ref>{{cite web|url= https://www.britannica.com/EBchecked/topic/231186/Germany/58197/The-economy-1890-1914|title= Germany - history - geography|url-status= live|archive-url= https://web.archive.org/web/20150503130703/https://www.britannica.com/EBchecked/topic/231186/Germany/58197/The-economy-1890-1914|archive-date= 3 May 2015}}</ref> The German chemical industry became the most advanced in the world, and by 1914 the country was producing half the world's electrical equipment.

The rapid advance to industrial maturity led to a drastic shift in Germany's economic situation – from a rural economy into a major exporter of finished goods. The ratio of the finished product to total exports jumped from 38% in 1872 to 63% in 1912. By 1913 Germany had come to dominate all the European markets. By 1914 Germany had become one of the biggest exporters in the world.<ref>
{{cite web
 |url= https://ohiostatepress.org/Books/Complete%20PDFs/Feldenkirchen%20Werner/03.pdf
 |title= Archived copy |access-date= 2015-02-02 |url-status= live
 |archive-url= https://web.archive.org/web/20160602204843/https://ohiostatepress.org/Books/Complete%20PDFs/Feldenkirchen%20Werner/03.pdf
 |archive-date= 2 June 2016 
}}
</ref>

===Weimar Republic and Third Reich===
{{Main|Economy of Nazi Germany}}
[[File:BSPDRWeltkriseEngl.PNG|thumb|250px|left|Gross national product and GNP deflator, year on year change in %, 1926 to 1939, in Germany. [https://www.google.de/search?q=Dr.+Norbert+R%C3%A4th,+Rezessionen+in+historischer+Betrachtung.+In%3A+Wirtschaft+und+Statistik+3%2F2009&gws_rd=ssl Via google to Pdf-file of German publication]]]
[[File:Occupation in Germany by district, 1925.svg|thumb|Occupation by administrative district in the 1925 census]]
The Nazis rose to power while unemployment was very high,<ref name=econ161>{{cite web |author=J. Bradford DeLong |date=February 1997 |url=http://econ161.berkeley.edu/TCEH/Slouch_Purge15.html |title=Slouching Towards Utopia?: The Economic History of the Twentieth Century -XV. Nazis and Soviets- |access-date=15 August 2007 |publisher=University of California at Berkeley and NBER |url-status=dead |archive-url=https://web.archive.org/web/20080511190923/http://econ161.berkeley.edu/TCEH/Slouch_Purge15.html |archive-date=11 May 2008}}</ref> but achieved [[full employment]] later thanks to massive public works programmes such as the [[Deutsche Reichsbahn|''Reichsbahn'']], ''[[Reichspost]]'', and the ''[[Reichsautobahn]]'' projects.<ref>{{cite book|last1=Gaettens|first1=Richard|title=Geschichte der Inflationen : vom Altertum bis zur Gegenwart |date=1982 |publisher=Battenberg |location=München |isbn=3-87045-211-0 |pages=279–298|edition=Nachdr.}}<!--|access-date=18 August 2014--></ref> In 1935 [[German rearmament|rearmament]] in contravention of the [[Treaty of Versailles]] added to the economy.<ref name=econ161/><ref>{{cite book|last1=Lee|first1=Stephen|title=Weimar and Nazi Germany|date=1996|publisher=Heinemann|location=Oxford|isbn=043530920X|pages=63}}</ref>

The post-1931 financial crisis economic policies of [[Fiscal policy|expansionary fiscal policies]] (as Germany was off the [[gold standard]]) was advised by their non-Nazi Minister of Economics, [[Hjalmar Schacht]],<ref name="econ161" /> who in 1933 became the president of the central bank. Schacht later resigned from the post in 1938 and was replaced by [[Hermann Göring]].

The trading policies of the Third Reich aimed at [[Autarky|self-sufficiency]] but with a lack of raw materials Germany would have to maintain trade links but on [[Bilateralism|bilateral]] preferences, [[foreign exchange controls]], [[import quota]]s, and [[Export subsidy|export subsidies]] under what was called the "New Plan"(''Neuer Plan'') of 19 September 1934.<ref name="Braun">Hans-Joachim Braun, ''"The German Economy in the Twentieth Century"'', Routledge, 1990, p. 101</ref> The "New Plan" was based on trade with less developed countries who would trade raw materials for German industrial goods saving currency.<ref>{{cite book|last1=Lee|first1=Stephen|title=Weimar and Nazi Germany|date=1996|publisher=Heinemann|location=Oxford|isbn=043530920X|pages=60}}</ref> [[Southern Europe]] was preferable to Western Europe and North America as there could be no trade blockades.<ref name="braun1990">Hans-Joachim Braun, ''"The German Economy in the Twentieth Century"'', Routledge, 1990, p. 102</ref> This policy became known as the ''Grosswirtschaftsraum'' ("greater economic area") policy.

Eventually, the Nazi party developed strong relationships with [[big business]]<ref name="bigbiz">Arthur Schweitzer, ''"Big Business in the Third Reich"'', Bloomington, Indiana University Press, 1964, p. 288</ref> and abolished [[Trade unions in Germany|trade unions]] in 1933 in order to form the [[Reich Labour Service]] (RAD), [[German Labour Front]] (DAF) to set working hours, [[Beauty of Labour]] (SDA) which set working conditions, and [[Strength Through Joy|Strength through Joy]] (KDF) to ensure sports clubs for workers.<ref>{{cite book|last1=Reynoldson|first1=Fiona|title=Weimar and Nazi Germany|date=1996|publisher=Heinemann|location=Oxford|isbn=0435308602|pages=49|edition=Foundation}}<!--|access-date=19 August 2014--></ref>

===West Germany===
{{See also|Wirtschaftswunder}}
[[File:VW Käfer Baujahr 1966.jpg|thumb|The [[Volkswagen Beetle]] was an icon of West German reconstruction.]]
Beginning with the [[Monetary reform|replacement]] of the [[Reichsmark]] with the [[Deutsche Mark]] as legal tender, a lasting period of low inflation and rapid industrial growth was overseen by the government led by [[Chancellor of Germany|German Chancellor]] [[Konrad Adenauer]] and his minister of economics, [[Ludwig Erhard]], raising West Germany from total wartime devastation to one of the most developed nations in modern Europe.

In 1953 it was decided that Germany was to repay $1.1 billion of the aid it had received. The last repayment was made in June 1971.

Apart from these factors, hard work and long hours at full capacity among the population in the 1950s, 1960s, and early 1970s and extra labour supplied by thousands of ''[[Gastarbeiter]]'' ("guest workers") provided a vital base for the economic upturn.

===East Germany===
{{Main|Economy of the German Democratic Republic}}
[[File:AWZ Trabant 601S, Verkehrszentrum des Deutschen Museums.JPG|thumb|The [[Trabant]] was an icon of East Germany.]]
By the early 1950s, the Soviet Union had seized reparations in the form of agricultural and industrial products and demanded further heavy reparation payments.<ref name="Norman M. Naimark 1949. pp. 167-9">Norman M. Naimark. ''The Russians in Germany: A History of the Soviet Zone of Occupation, 1945–1949.'' Harvard University Press, 1995. {{ISBN|0-674-78405-7}} pp. 167-9</ref> [[Silesia]] with the [[Upper Silesian Coal Basin]], and [[Szczecin|Stettin]], a prominent natural port, were lost to [[Polish People's Republic|Poland]].

Exports from West Germany exceeded $323 billion in 1988. In the same year, East Germany exported $30.7 billion worth of goods; 65% to other communist states.<ref name="tol0807">{{cite news |title=Germany starts recovery from €2,000bn union |url=http://www.timesonline.co.uk/tol/news/world/europe/article2317382.ece |newspaper=Times Online |date=24 August 2007 |access-date=12 October 2009 |location=London |first=Roger |last=Boyes |url-status=dead |archive-url=https://web.archive.org/web/20100529132954/http://www.timesonline.co.uk/tol/news/world/europe/article2317382.ece |archive-date=29 May 2010}}</ref> East Germany had zero unemployment.<ref name="tol0807"/>

Car markers like the [[Automobilwerk Eisenach]] and the [[HQM Sachsenring GmbH]] produced icons of the East German economy like the [[Trabant|Trabant line]] and the [[Wartburg (marque)|Wartburg line]].

===Federal Republic===
[[File:Containershipxinshanghai.jpg|thumb|{{As of|2013}}, Germany is the third-largest exporter and third-largest importer in the world, producing the largest trade surplus as a national economy.]]
The German economy practically stagnated in the beginning of the 2000s. The worst growth figures were achieved in 2002 (+1.4%), in 2003 (+1.0%), and in 2005 (+1.4%).<ref name=gdpstat>[http://www.destatis.de/jetspeed/portal/cms/Sites/destatis/Internet/DE/Content/Statistiken/VolkswirtschaftlicheGesamtrechnungen/Inlandsprodukt/Tabellen/Content75/BruttoinlandVierteljahresdaten,property=file.xls Bruttoinlandsprodukt (Vierteljahres- und Jahresangaben)] {{webarchive|url=https://web.archive.org/web/20101113234123/http://www.destatis.de/jetspeed/portal/cms/Sites/destatis/Internet/DE/Content/Statistiken/VolkswirtschaftlicheGesamtrechnungen/Inlandsprodukt/Tabellen/Content75/BruttoinlandVierteljahresdaten,property=file.xls |date=13 November 2010}} Statistisches Bundesamt.</ref> Unemployment was also chronically high.<ref name=ciafactbook>{{cite web |url=https://www.cia.gov/the-world-factbook/countries/germany/ |title=CIA Factbook: Germany |publisher=Cia.gov |access-date=2014-08-13 }}</ref> Due to these problems, together with [[Demographics of Germany|Germany's aging population]], the welfare system came under considerable strain. This led the government to push through a wide-ranging programme of belt-tightening reforms, [[Agenda 2010]], including the labour market reforms known as [[Hartz concept|Hartz I - IV]].<ref name=ciafactbook/>

In the later part of the first decade of 2000, the world economy experienced high growth, from which Germany as a leading exporter also profited. Some credit the Hartz reforms with achieving high growth and declining unemployment but others contend that they resulted in a massive decrease in standards of living and that its effects are limited and temporary.<ref name=ciafactbook/>

The nominal GDP of Germany contracted in the second and third quarters of 2008, putting the country in a technical recession following a global and [[Great Recession in Europe|European recession]] cycle.<ref>{{cite news | url=https://www.theguardian.com/world/2008/nov/14/oecd-recession-germany-inflation-deflation | title=Germany officially in recession as OECD expects US to lead recovery | newspaper=The Guardian | date=14 November 2008 | location=London | first=Kathryn | last=Hopkins | access-date=1 May 2010 | url-status=live | archive-url=https://web.archive.org/web/20130904060335/http://www.theguardian.com/world/2008/nov/14/oecd-recession-germany-inflation-deflation | archive-date=4 September 2013}}</ref> German industrial output dropped to 3.6% in September vis-à-vis August.<ref>{{cite news |last=Thesing |first=Gabi |url=https://www.bloomberg.com/apps/news?pid=20601087&sid=aV1q1nQoldKc&refer=home |title=bloomberg.com, German Economy Enters Worst Recession in 12 Years |publisher=Bloomberg.com |date=2008-11-13 |access-date=2014-08-13 |url-status=live |archive-url=https://web.archive.org/web/20100613163056/http://www.bloomberg.com/apps/news?pid=20601087 |archive-date=13 June 2010}}</ref><ref>[https://www.nytimes.com/2008/11/13/business/worldbusiness/13iht-14germany.17791168.html?_r=0 German economy falls into recession] {{webarchive|url=https://web.archive.org/web/20160723024510/http://www.nytimes.com/2008/11/13/business/worldbusiness/13iht-14germany.17791168.html?_r=0 |date=23 July 2016}}, New York Times, 2008-11-13</ref> In January 2009 the German government under [[Angela Merkel]] approved a €50 billion ($70 billion) economic stimulus plan to protect several sectors from a downturn and a subsequent rise in unemployment rates.<ref>{{cite news|url=http://www.france24.com/en/20090106-germany-agrees-new-50-billion-euro-stimulus-plan |title=Germany agrees on 50-billion-euro stimulus plan |publisher=France 24 |date=6 January 2009 |url-status=dead |archive-url=https://web.archive.org/web/20110513022443/http://www.france24.com/en/20090106-germany-agrees-new-50-billion-euro-stimulus-plan |archive-date=13 May 2011}}</ref> Germany exited the recession in the second and third quarters of 2009, mostly due to rebounding manufacturing orders and exports - primarily from outside the eurozone - and relatively steady consumer demand.<ref name=ciafactbook/>

Germany is a founding member of the EU, the [[G8]], and the [[G20]], and was the world's largest exporter from 2003 to 2008. In 2011 it remained the [[List of countries by exports|third largest exporter]]<ref name="CIA exports">{{cite web| url = http://www.worldstopexports.com/germanys-top-10-exports/2061| title = Country Comparison :: Exports| work = The World Factbook| publisher = [[Central Intelligence Agency]]| access-date = 9 August 2012| issn = 1553-8133| url-status = live| archive-url = https://web.archive.org/web/20131028034433/http://www.worldstopexports.com/germanys-top-10-exports/2061| archive-date = 28 October 2013}}</ref> and third largest importer.<ref name="CIA imports">{{cite web| url = https://www.cia.gov/library/publications/the-world-factbook/rankorder/2087rank.html| title = Country Comparison :: Imports| work = The World Factbook| publisher = [[Central Intelligence Agency]]| access-date = 9 August 2012| issn = 1553-8133| url-status = dead| archive-url = https://web.archive.org/web/20081004070323/https://www.cia.gov/library/publications/the-world-factbook//rankorder/2087rank.html| archive-date = 4 October 2008}}</ref> Most of the country's exports are in engineering, especially machinery, automobiles, chemical goods, and metals.<ref name="CIA">{{cite web| url = https://www.cia.gov/the-world-factbook/countries/germany/| title = CIA Factbook| access-date = 2 August 2009| author = CIA| author-link = Central Intelligence Agency}}</ref> Germany is a leading producer of wind turbines and solar-power technology.<ref>{{cite web |url=http://www.german-renewable-energy.com/Renewables/Navigation/Englisch/wind-power.html |archive-url=https://web.archive.org/web/20061210163253/http://www.german-renewable-energy.com/Renewables/Navigation/Englisch/wind-power.html |archive-date=10 December 2006 |title=Wind Power |publisher=Federal Ministry of Economics and Technology |access-date=27 March 2011}}</ref> Annual trade fairs and congresses are held in cities throughout Germany.<ref>{{cite web|title=Euro Fair Statistics 2008 |publisher=AUMA Ausstellungs- und Messe-Ausschuss der Deutschen Wirtschaft e.V. |page=12 |author=UFI, the Global Association of the Exhibition Industry |year=2008 |url=http://www.auma.de/_pages/d/16_Download/download/FKM/EuroFairStatistics_2008.pdf |access-date=24 September 2011 |url-status=dead |archive-url=https://web.archive.org/web/20110718201111/http://www.auma.de/_pages/d/16_Download/download/FKM/EuroFairStatistics_2008.pdf |archive-date=18 July 2011}}</ref> 2011 was a record-breaking year for the German economy. German companies exported goods worth over €1 trillion ($1.3 trillion), the highest figure in history. The number of people in work has risen to 41.6 million, the highest recorded figure.<ref>{{cite news| url= http://www.spiegel.de/international/business/0,1518,805554,00.html| title= Defying the Euro Crisis| work= Spiegel Online| date= 27 December 2011| url-status= live| archive-url= https://web.archive.org/web/20111227161452/http://www.spiegel.de/international/business/0,1518,805554,00.html| archive-date= 27 December 2011}}</ref>

Through 2012, Germany's economy continued to be stronger relative to local neighbouring nations.<ref>[https://www.nytimes.com/2012/04/29/world/europe/germany-looks-to-southern-europe-to-fill-jobs.html Brain Drain Feared as German Jobs Lure Southern Europeans] {{webarchive|url=https://web.archive.org/web/20170126091539/http://www.nytimes.com/2012/04/29/world/europe/germany-looks-to-southern-europe-to-fill-jobs.html |date=26 January 2017}} 28 April 2012</ref> In 2023, Germany experienced economic difficulties as a result of the closure of Russian natural gas resources due to [[International sanctions during the Russian invasion of Ukraine|international sanctions]] following the [[Russian invasion of Ukraine]].<ref>{{Cite web |date=2023-09-19 |title=Germany went from envy of the world to the worst-performing major developed economy. What happened? |url=https://apnews.com/article/germany-economy-energy-crisis-russia-8a00eebbfab3f20c5c66b1cd85ae84ed |access-date=2023-10-23 |website=AP News |language=en}}</ref> Germany imported 55% of its gas from Russia at the time when Russia started the invasion in 2022.<ref name="brookings.edu">{{Cite web |title=How did Germany fare without Russian gas? |url=https://www.brookings.edu/articles/how-did-germany-fare-without-russian-gas/ |access-date=2023-12-28 |website=Brookings |language=en-US}}</ref> Amid a [[Global energy crisis (2021–present)|global energy crisis]], Chancellor [[Olaf Scholz]] committed to weaken dependence on [[Russia in the European energy sector|Russian energy imports]] by halting certification of [[Nord Stream 2]], while also committing to his long-term predecessor Angela Merkel's policy of [[Nuclear power in Germany|phasing out nuclear energy]].<ref>{{cite news |date=9 June 2022 |title=Scholz and liberal finance minister clash over nuclear phase-out |work=[[Euractiv]] |url=https://www.euractiv.com/section/energy-environment/news/scholz-and-liberal-finance-minister-clash-over-nuclear-phase-out/}}</ref><ref>{{cite news |date=14 September 2022 |title=How Bad Will the German Recession Be? |work=Der Spiegel |url=https://www.spiegel.de/international/business/energy-crisis-fallout-how-bad-will-the-german-recession-be-a-9e1f479e-5fef-4e62-b5ca-2f9e87b9bbca}}</ref><ref name="brookings.edu"/>

As of December 2023, Germany is the third largest economy in [[List of countries by GDP (nominal)|nominal]] terms in the world after the United States and China, and the largest economy in Europe. It is the third largest export nation in the world.<ref>{{Cite web |date=5 December 2023 |title=Economic Key Facts Germany |url=https://kpmg.com/de/en/home/insights/overview/economic-key-facts-germany.html}}</ref>

In April 2024, a report by the [[German Economic Institute]] revealed that despite attempts to expand into other markets, the German economy remains heavily reliant on China for various products and raw materials.<ref>{{Cite web |title=Ahead of Scholz trip, study shows German economy still dependent on China |website=[[Reuters]] |url=https://www.reuters.com/markets/europe/ahead-scholz-trip-study-shows-german-economy-still-dependent-china-2024-04-09/}}</ref>

During 2024, the German economy experienced its second consecutive year of contraction. Europe's largest economy declined by 0.2% over the year,<ref>{{Cite web |title=Gross domestic product down 0.2% in 2024 |url=https://www.destatis.de/EN/Press/2025/01/PE25_019_811.html |access-date=2025-01-22 |website=Federal Statistical Office |language=en}}</ref> following a 0.3% contraction in 2023. Germany's trade surplus with the United States, reported by [[Reuters]] to have reached a record €65 billion (£54.7 billion) during the first 11 months of 2024, has made the nation a likely target for potential tariffs from Donald Trump's administration.<ref>{{Cite news |last=Wagner |first=Rene |date=2025-01-10 |title=Germany's trade surplus with US reaches record high as Trump tariffs loom |url=https://www.reuters.com/markets/europe/germanys-trade-surplus-with-us-reaches-record-high-trump-tariffs-loom-2025-01-10/ |access-date=2025-01-22 |work=[[Reuters]]}}</ref> The economic climate has also been affected by widespread layoffs across major German corporations. Companies such as Siemens, Bosch, Thyssenkrupp, and Deutsche Bahn, all featured in the Fortune 500, are estimated to have collectively cut over 60,000 jobs during the first 10 months of 2024.<ref>{{Cite web |date=2025-01-21 |title=Siemens Layoffs 2024: What to Know About the Latest Siemens Job Cuts |url=https://markets.businessinsider.com/news/stocks/siemens-layoffs-2024-what-to-know-about-the-latest-siemens-job-cuts-1033432797 |access-date=2025-01-22 |website=markets.businessinsider.com |language=en}}</ref> Bosch, a highly regarded manufacturing firm, announced in November alone plans to reduce its workforce by approximately 7,000 employees.<ref>{{Cite web |title=Bosch Lays Off 7,000 Employees, CEO Stefan Hartung Says More Layoffs Cant Be Ruled Out |url=https://www.news18.com/business/bosch-lays-off-7000-employees-ceo-stefan-hartung-says-more-layoffs-cant-be-ruled-out-9109016.html |access-date=2025-01-22 |website=News18 |language=en}}</ref>