German Finance Minister Christian Linder warned on Thursday that Berlin was in the midst of an “energy war” with Russia, as his government announced a budget to set a price cap for energy prices.
“We find ourselves in an energy war that is about prosperity and freedom,” Linder told reporters.
Germany plans to spend up to 200 billion euros ($195 billion) to help people and businesses cope with rising energy prices.
And Chancellor Olaf Schulz said today, Thursday, that the government will reactivate the Economic Stability Fund, which was previously used during the global financial crisis and the coronavirus pandemic.
He added: Russia’s decision to cut off natural gas from Europe and the recent leakage of the Nordstream 1 and 2 pipelines showed that we should not expect more energy from Russia in the near future.
Germany’s biggest economic institutions on Thursday expected Europe’s largest economy to enter recession next year due to persistently high energy prices.
The report of economic institutes “Ifo”, “RWI”, “EWH” and “EFW”: the German economy cannot avoid entering recession next year.
The Organization for Economic Co-operation and Development report also predicts that Germany will enter recession next year, with Europe’s largest economy shrinking by 0.7 percent – 2.4 percentage points lower than previously forecast.
Since the beginning of the war in Ukraine last February, Germany has been suffering from the aggravation of the energy crisis due to the cut-off of Russian gas from Russia to Europe, as a result of the sanctions and counter-sanctions policy of the West and Moscow.
Russia cut gas supplies to Europe via Nord Stream 1 before suspending the flow entirely last August.
Moscow blamed Western sanctions for causing technical problems in the gas transfer to Europe.
The new Nord Stream 2 did not enter commercial operations because Germany canceled plans to use it for gas supplies days before Russia’s military operation in Ukraine began.
Nord Stream 1 and 2 saw a new crisis this week after gas leaked from them below sea level, leading to accusations being exchanged about who was behind what was described as “deliberate sabotage”.
Source: Lebanon Debate
