GEAB 112

We anticipate that this European state will face several economic, cultural and political difficulties this year and next. First, the rise of the euro will hurt German exports; the stabilisation of oil prices prohibits the oxygen balloon effect of prices declines of 2015; failure of the migrant strategy puts Germany face to face with all the consequences of its weak demographics (in terms of domestic consumer market and potential for wage decline); there are centrifugal tendencies within the federation particularly with growing cultural and political divergences as in Bavaria; and finally the weight of East Germany is likely to become more and more unbearable for the productive Germany in this context.

Europe has had its fair share of change and turmoil over the last century, and in few places, has this been more prevalent than in Germany. Now, Germany is a pacifist nation, refraining from engaging in global military endeavours, which have proved costly and inconclusive for other Western nations. Since 1954, and using a more measured approach, Germany has slowly, but surely, emerged not only as Europe’s leader, but also as its champion. It first did this economically through its sophisticated methods of production, then fiscally through the development of its banking and finance sector and lately through the leadership of its Chancellor, Angela Merkel.

But can this level of success continue? Is Germany set to climb ever higher or start to sink into the quicksand of populist desire, which has begun to drown many a great nation?