Russian invasion
Institute: War has significant economic consequences
The war could have devastating economic consequences in Germany. Photo: Uncredited/Maxar Technologies/AP/dpa
© dpa-infocom GmbH
Palladium, nickel and neon: Due to the war in Ukraine, there are more and more supply bottlenecks in Germany. The German economy could come under even more pressure.
The German Economic Institute sees significant economic consequences for Germany because of the Russian war of aggression in Ukraine.
The extent is not foreseeable. The existing problems with international supply chains would be exacerbated by new supply bottlenecks, according to a study by the German Economic Institute (IW/Cologne) available to the German Press Agency.
Important raw material deliveries from Russia were missing. So far, important materials and preliminary products have also been supplied from the Ukraine. Palladium, nickel, neon or cable harnesses are examples of newly created bottlenecks. “If these last longer because replacements can only be mobilized to a limited extent, there is a risk of sustained production losses in the German economy.”
The study is based on the results of a survey of 1900 companies. Accordingly, around three quarters of the companies see themselves burdened by high energy prices. Well over a third are threatened in their business processes by failed deliveries of advance services or imminent bottlenecks in the energy supply. Worries have tended to increase since the first week of the war. “For the medium term, further increasing burdens from the war for companies in Germany are expected,” it said.
In addition to the still existing burdens as a result of the corona pandemic, there is the danger of “further and in some cases unpredictable business risks” and “burdens of adjustment” for companies in Germany.
Above all, the possible cessation of gas deliveries from Russia to Europe would result in a significant change in the economic outlook. The federal government rejects such an embargo, but Russia could stop deliveries.