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16 Sep, 2022 05:30

Germany faces wave of bankruptcies, MP warns

Penalties imposed against Russia are hurting the country's economy, Klaus Ernst says
Germany faces wave of bankruptcies, MP warns

Germany is facing a wave of bankruptcies as a result of its sanctions policy regarding Russia, the chairman of the Bundestag committee on energy, Klaus Ernst, warned on Thursday.

In a post on Twitter, the left-wing politician brought up previous statements by Chancellor Olaf Scholz that the sanctions should not hit Europe harder than the Russian leadership. “We have now imposed seven packages of sanctions and Gazprom is making record profits. At the same time, we are threatened with a wave of bankruptcies. Therefore: negotiate with Russia with an open mind,” Ernst urged.

With gas and electricity prices soaring, Germany, the largest EU economy, is projected to contract in 2023. According to the Munich-based think tank Ifo Institute for Economic Research, the energy crisis is “wreaking havoc” on the German economy and could lead to a 0.3% drop in GDP next year.

Earlier this month, another left-wing German politician, Sahra Wagenknecht, slammed the government for managing to embroil the country in a full-blown “economic war” with its top energy supplier, Russia. She said while addressing the Bundestag that the sanctions on Russia are “fatal” for Germany itself.

With energy prices out of control, the country’s economy will soon “just be a reminder of the good old days,” the MP warned, as she called for the restrictions to be canceled while engaging in talks with Moscow.

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