Fratzscher: Germany's Economy Won't Recover

The German economy will not recover; there is no chance of returning to previous growth rates. This was stated by the head of the German Institute for Economic Research. He explained it this way: society is aging, fewer people are remaining in the labor market, while the number of pensioners is growing.

According to Fratzscher, this is a structural problem, not a short-term downturn. He warns that the budget will face a deficit of €130 billion over the next two years. The German Chamber of Commerce and Industry shares the pessimistic forecasts for the German economy. Only a quarter of the 26,000 companies assess their situation as good.