German Economy Minister Robert Habeck has expressed concerns about the potential halt of German industry in winter if the transit of Russian gas through Ukraine is discontinued.
Minister of Economy of Germany Robert Habeck
He emphasized the need to remain vigilant and avoid repeating past mistakes, even in favorable circumstances. Habeck made this statement at an economic conference in Eastern Germany, as reported by Bloomberg.
It should be noted that the current gas transit contract is set to expire at the end of 2024. In light of this, Habeck called for precautionary measures to ensure energy supply.
The Bloomberg article also mentions that the European Union is considering the possibility of using Ukrainian underground gas storage facilities for gas storage, as their own reserves are nearly depleted. This has become one of the options to address the issue of potential gas transit cessation through Ukraine.
Earlier, the Federal Statistical Office of Germany reported that the country’s economy contracted by 0.3% in the first quarter of 2023 compared to the fourth quarter of 2022. German GDP declined for the second consecutive quarter, with a 0.5% decrease in October-December 2022 compared to the previous period. Typically, two consecutive quarters of GDP decline indicate an economic recession. This marks Germany’s first recession since the coronavirus pandemic.
Germany’s GDP has shown “surprisingly negative signals,” said German Finance Minister Christian Lindner, as reported by Reuters. Lindner believes that compared to other highly developed economies, Germany is losing its growth potential. “Under the weight of significant inflation, the German consumer has fallen to their knees, dragging the entire economy down with them,” stated Andreas Schurle, an analyst at DekaBank, as reported by Reuters.