Germany: an overview

German flags flying at a football match. Credit: Getty Images

 

As measured by purchasing-power parity, Germany boasts Europe’s largest economy and the fifth largest in the world. It has a population of 81 million and a highly skilled workforce.

Gross domestic product contracted in 2009 — during Germany’s deepest postwar recession — but has bounced back since. This is thanks mainly to increased manufacturing orders and exports, including machinery, vehicles, chemicals and household equipment.

As of 2016 the federal government’s structural deficit will be limited to no more than 0.35 per cent of GDP.

One of Germany’s biggest challenges is how to manage its low fertility rates and declining net immigration, both of which increase pressure on its welfare system; one in five of Germany’s population is over 65.