Expectations that the German economy will grow by only 0.1% this year (Shutterstock)
The Federal Bureau of Statistics in Germany announced on Wednesday that the volume of the country's sovereign debt rose last year by 77.3 billion euros ($83.6 billion), or 3.3%.
The office, which is based in the city of Wiesbaden, explained that the total debts of the federal government, states, municipalities and social insurance companies reached 2.45 trillion euros ($2.65 trillion) by the end of last year.
The office noted that there was a small special effect that contributed to the volume of sovereign debt reaching this value, explaining that since the second quarter of 2023, the debts of public transport companies have been included in the public debt calculation.
The office added that without public transport sector debt, sovereign debt would have increased by 2.9%, meaning that the size of the debt would have been less than the declared value by 9 billion euros.
According to the office:
Federal government debt increased above average, rising by 4.7% or by €76 billion to nearly €1.7 trillion.
State debt decreased by 1.9 billion euros to 595.4 billion euros. The decline was expected to be greater without including the debts of public transport companies.
Municipal debts clearly increased by 9.1% compared to the end of 2022, reaching €153.6 billion.
The German economy is suffering
Also in Germany, the most prominent German economic institutes significantly reduced on Wednesday their expectations for GDP growth for the year 2024, expecting it to reach 0.1%.
In the fall, the institutes expected growth of 1.3% in Germany this year, but they have become more pessimistic now due to the slow recovery in consumption.
Its new forecasts are close to those of the German government, which forecast growth of 0.2% this year.
"The economy in Germany is suffering," said Stefan Kuthes, director of economic research at the Kiel Institute, adding, "Although recovery is possible from the spring, the overall momentum will not be very strong."
On Wednesday, the Kiel Institute for the World Economy spoke of “headwinds” for the economy from inside and outside Germany.
In 2023, the German economy declined significantly, with the gross domestic product declining by 0.3% due to the industrial sector crisis.
The institute's experts say that productivity in Germany has been "stagnant." Private consumption was less dynamic than expected, and exports declined despite the increase in global economic activity.
Source: German News Agency