# German economy returns to growth, so why is the country still worried?

- URL: https://talkfuse.com/story/german-economy-returns-to-growth-so-why-is-the-country-still-worried/
- Published: 2026-11-15T16:12:00+00:00
- Updated: 2026-11-15T17:38:18+00:00
- Original publisher: DW (publisher lean: Centre)
- Original article: https://www.dw.com/en/german-economy-returns-to-growth-so-why-is-the-country-still-worried/a-79932220?maca=en-rss-en-all-1573-rdf
- Topics: Business, Economy, Europe, World

## Key points

- Germany is growing again, but only modestly.
- Economists warn public finances face long-term pressure.
- Industry leaders say production and jobs are falling.

## Summary

Germany’s economy has returned to modest growth, prompting Chancellor Friedrich Merz to welcome signs of recovery. But business leaders and economists say the improvement does not resolve deeper problems: weak productivity, political delays over reform and mounting pressure on public finances could erode prosperity over time.

The Council of Economic Experts forecasts growth of 1.3% in 2026 and 1% in 2027, supported by stronger-than-expected exports and government spending after an energy price shock linked to the war in Iran. Mechanical engineering production has fallen about 20% since 2018, while the sector is cutting 15,000 jobs a month. Ageing-related social costs, defence and debt interest are expected to take up 80% of federal spending; the 2027 budget plans more than €555 billion in expenditure and over €118 billion in new borrowing.

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Summarised by TalkFuse (https://talkfuse.com/). Quote the original publisher for the reporting and link this page for the summary and discussion.