Germany blames Trump’s tariff policy as the key reason for why its economy will stagnate this year

Berlin (AP) – Germany’s economy will flow this year while the country is facing headwinds from US presidentDonald Trump’sThe tariffs and trading threats, government panel independent economic economic counselors said Wednesday.

Germany has the largest European economy, but not seeing importantEconomic growth in five yearsand the gross domestic producer flows each otherthe last two years.

Advisory panel, at first ForeCect from newChancellor Friedrich Merz’sThe government is earlier in this month, the economy predicts this year and grow in 1% of 2026.

The new sight is in lineWith forecast made a month ago in the last government in Germany.

Merz, who took office on May 6, promised to turn off the back bureaucracy, advance to digitize, provide tax breaks for companies and promotes several trading agreements in Europe.

“Trump tariff policy increases uncertainty and risks economic growth around the world,” said Monika Schnitzer, the President of the Panel. But he said a bigPurpose of investmentMerz’s coalition “offers opportunities for a modernization of Germany’s infrastructure and return to a higher growth path,” which means a better sight for next year.

Germany over many years expanded export and delivered world trade with engineered products such as industrial machinery and luxury cars. But it suffers from increasing competition from Chinese companies, along with many other reasons, and Trump’s tariffs add more risk to German exports.

Last year, the United States was the largest single in GermanyTrading CompareFor the first time since 2015, depicting China from the highest area as exported to Asian power declined.

This story originally shown Fortune.com

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