Germany is the ‘sick man of Europe’ — and it’s causing a shift to the right, top economist says

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Germany is once again the “sick man of Europe,” according to Hans-Werner Sinn, president emeritus at the Ifo institute, and the challenges that poses, particularly in terms of the country’s energy strategy, could serve to benefit increasingly popular right-wing parties.The “sick man of Europe” moniker has resurfaced in recent weeks as manufacturing output continues to stutter in the region’s largest economy and the country grapples with high energy prices. The label was originally used to describe the German economy in 1998 as it navigated the costly challenges of a post-reunification economy.”It is not a short-term phenomenon,” Sinn told CNBC’s Steve Sedgwick at the Ambrosetti Forum in Italy on Friday.It “has to do with the automobile industry, which is the heart of the German industry and many things hinge on that,” he said. Cars were Germany’s main export product last year, accounting for 15.6% of the value of goods sold abroad, federal statistics office data shows.Germany reported a foreign trade deficit for the first time in decades in May 2022, totaling 1 billion euros ($1.03 billion). The country had briefly shifted from a trade surplus to importing more than it exports.Germany has since returned to a trade surplus, which …

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