Mon, 15 Aug 2022

Losses could amount to almost ?200 billion this year, Bild reports

The German economy could lose 12.5% of its annual output if Russian natural gas supplies are abruptly stopped, the tabloid Bild reported on Tuesday, citing a study by the Bavarian Industry Association.

The analysis was reportedly carried out by Prognos AG, based on a scenario in which Russian gas supplies are cut off on July 1.

If this were to occur, Germany's glass, steel, and food industries would suffer losses of €49 billion this year, which would affect production and supply chains in other industries. The costs were estimated to reach €144 billion in the second half of the year. In total, around €193 billion would be wiped off GDP in the six months of 2022, the research shows.

"The dependence of the German economy on Russian gas is underestimated," Prognos AG spokesman Michael Behmer said, as quoted by the Bild.

Germany had once received around 55% of its imported gas from Russia. This month, Russian gas flows via the Nord Stream pipeline to the country were cut by as much as 60% due to technical issues arising from the sanctions on Moscow. In response to this, the German government launched the second 'alarm' phase of its three-level gas emergency plan. Berlin has warned that it faces a severe shortage of gas amid decreasing flows from Russia.

For more stories on economy & finance visit RT's business section

(RT.com)

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