Deutsche Bank CEO: Germany could be Europe’s sick man

Christian Sewing, CEO of Deutsche Bank, said that if the “structural problems” are not urgently solved, Germany will become the sick man of Europe.

In his opening speech today at the Handelsblatt Banken Summit, Sewing said: “We are not the sick man of Europe. However, it is also true that there are structural weaknesses that hold back our economy and prevent it from developing its great potential. “If we do not address these structural problems now, we will become the sick man of Europe,” he said.

The Deutsche Bank CEO also listed other problems that contribute to Germany’s “sick man” image, such as high and unpredictable energy costs, slow Internet connections, outdated rail networks, delays in digitalization, lack of of qualified workers, excessive bureaucracy and lengthy approval procedures.

CHALLENGES FOR THE GERMAN ECONOMY

Peter Oppenheimer, Goldman Sachs chief global equity strategist and head of EMEA macroeconomic research, told CNBC on Tuesday that many of the factors challenging the German economy are global headwinds.

“The situation the economy is facing right now really depends on a number of factors,” Oppenheimer said, adding that challenges in the manufacturing sector, problems in the Chinese economy and high energy costs were contributing to the recession. in Europe’s largest economy.

ENTERED INTO RECESSION

Germany entered a technical recession, with a contraction of 0.3 percent in the first quarter of the year. The German economy also contracted by 0.5 percent in the last quarter of 2022.

Since then, several institutions, including the Bundesbank and the International Monetary Fund (IMF), have predicted that the German economy will contract further.