Wifo boss Gabriel Felbermayr sees an opportunity for Europe in the weakness of the German economy. Germany is falling behind in EU competition, said the director of the economic research institute (Wifo). For Europe, however, this ‘rebalancing’ is a good thing. Because the differences between Northern and Southern Europe would become smaller.
These differences have repeatedly led Europe into serious difficulties, for example with the euro debt crisis. “Over the years, the South became increasingly expensive, there was high unemployment, low growth and government deficits that got out of hand.”
Inflation in the north higher than in the south
Now inflation has been higher in the north than in the south for some time now. “This stabilizes for the eurozone as a whole,” Felbermayr told the Spiegel.
Since the euro crisis, Germany has asked others to do their homework. That happened. But the Federal Republic itself has not moved much. The share of industry in gross domestic product (GDP) is now falling. It is rising elsewhere in Europe. This trend will continue.
The Federal Republic must respect that the maximum speed at which the German economy can run will decrease in the long term. The situation in Germany is now comparable to that in Italy, Spain or Greece fifteen years ago.
Source: Krone
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
