Merkel misery: Sluggish Covid recovery rubs salt in wound for German Chancellor

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Europe’s largest economy grew by 1.5 percent quarter on quarter, figures published by the Federal Statistics Office said, and by 9.2 percent on the year. However, a Reuters poll had forecast increases of two percent and 9.6 percent respectively.

Compared with the fourth quarter of 2019, the last pre-pandemic period, gross domestic product (GDP) is still down 3.4 percent.

VP Bank Group Chief Economist Thomas Gitzel said: “Growth is decent, but it could have been stronger if it wasn’t for shortages of materials.”

Supply chain worries and rising coronavirus infections have dampened the outlook for the economy.

A survey published on Monday indicated that German business morale fell unexpectedly in July, the first decline since January.

After more than two months of steady decline, COVID-19 cases have been rising since early July, due mainly to the spread of the more infectious Delta variant.

Roughly 60 percent of Germany’s 83 million people have had a first shot of a COVID-19 vaccine and just over half are fully vaccinated.

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Since the start of 2021, the usual rates of 19 and seven percent have applied.

A statement issued by the FSO said: “A base effect due to the coronavirus-induced reduction in VAT rates in July 2020 is, in particular, responsible for the further increase in the inflation rate in July 2021.

“Since January 2021, VAT rates for almost all goods and services have been back at the previous level.”

All travellers arriving in Germany will be required from this weekend to demonstrate immunity from COVID-19 either from a vaccine or previous infection, or present a negative test result, government sources reported.

The plan reflects growing concern among Germany’s regional and national leaders that rising caseloads in tourist destinations could help fuel a fourth wave when Germans come home from holiday.

Germany now requires a negative test or proof of immunity only from those arriving from so-called “risk areas”, “high-incidence areas” and “virus-variant areas”, which in Europe now include Britain, Spain and the Netherlands.

Mrs Merkel is due to step down as the country’s leader in September, and has faced strong criticism recently from among others former Greek finance minister Yanis Varoufakis.

The economist tweeted earlier this week: “I just met a German tourist who claimed Merkel was great for Germany.

“To which I responded: vaccination chaos, missing flood warning systems, bad 4G coverage, Diesel gate, Wirecard & Deutsche Bank scandal. And that 50 percent of Germans are worse off financially today than they were in 2005.”



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