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Germany’s Economy Stalls Amid Falling Output and Political Bickering

But that will not be enough to fix Germany’s structural problems. One is a lack of domestic energy sources: The country relies on imports to sustain the industries that have formed the backbone of its economy for decades. They include car making, steel and the chemicals industry, which reported that production fell 11 percent last year.

Overall, Germany’s industrial sector is struggling to cope with not only the high price of energy but with the transition to a future that is more nimble and more digital. Plans to digitize the country’s prized but paperbound bureaucracy, which traces its roots to 19th-century Prussia, largely stalled last year, according to an official index.

The country failed to reach its goal, set in 2017, of requiring all public offices to offer digital services by the end of 2022. That infrastructure lags miles behind the rest of the European Union, where on average 56 percent of homes are connected to fiber-optic cables, compared with 19 percent of German homes.

In the private sector, companies complain that the amount of paperwork required to build or expand hampers growth.


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