Jakarta, CNBC Indonesia – The German economy is predicted to experience a serious contraction due to the Russian attack on Ukraine. The value of this contraction is projected to reach US$ 265 billion or almost equivalent to Rp 4 thousand trillion.
This was revealed from a study by the Institute for Employment Research (IAB). This figure is obtained from the potential loss of added value or value-added that the country can develop by 2030.
The IAB said this was due to rising energy prices after the crisis triggered by the wars between Russia and Ukraine. Germany previously depended up to 40% of its energy supply on Russia and this crisis was felt to be able to bring the country towards rising unemployment.
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“The employment rate is expected to remain around this level until 2026, when gradual expansionary measures will begin to outweigh the negative effects and lead to the added value of about 60,000 people employed by 2030,” the agency wrote in a release Tuesday. (9/8/2022), which was proclaimed Reuters.
One of the industries that is predicted to suffer big losses is the hotel industry. The industry has already been hit hard by the coronavirus pandemic and is likely to feel a slight drop in consumer purchasing power.
In addition, energy-intensive sectors such as the chemical industry and metal production are also likely to be affected.
“If energy prices, which have so far jumped 160%, were to double again, Germany’s 2023 economic output would be nearly 4% lower than without the war,” according to the study.
“Under this assumption, 660,000 fewer people will be employed after three years and still 60,000 fewer in 2030.”
So far the flow of gas from Russia to Germany itself is known to have been cut quite a lot. Russia blamed this condition on European Union (EU) sanctions that bar the turbines of one of its gas pipelines, Nord Stream I, from being returned after repairs from Canada.
However, Germany and other Blue Continent countries such as Italy called this a revenge maneuver for Moscow. The reason is, Europe took steps against the attack on Ukraine and imposed a series of economic sanctions on Russia so that it could not afford military action in the Kyiv region.
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