Germany Cuts 2025 Growth Forecast to Zero Amid Trump Tariffs

The German government has sharply downgraded its economic outlook for 2025, now projecting zero growth, a significant reversal from earlier forecasts. Officials attribute this stagnation largely to U.S. President Donald Trump's trade policies, particularly tariffs on imported automobiles and other goods, which have directly impacted Germany's export-driven economy. The move follows two consecutive years of recession, marking Germany as the only G7 nation not to grow during this period. Leading economic think tanks and the IMF have echoed these concerns, highlighting further risks from geopolitical tensions, increased competition from Chinese manufacturers, and domestic structural challenges such as bureaucracy and labor shortages. Outgoing Economy Minister Robert Habeck emphasized the need for Germany to reduce reliance on critical raw materials and strengthen ties with global trade partners. The incoming German government is expected to implement fiscal measures, including looser borrowing limits and increased investment in defense and infrastructure, to support recovery.