As Germany approaches its elections on February 25, 2025, the economy's stagnation and potential solutions are at the forefront of voters' concerns.

The German economy, which is the world's third-largest, has faced back-to-back contractions in 2022 and 2023, with the International Monetary Fund projecting a meager growth of only 0.3% for 2025.

Experts warn that a shift away from free trade could severely impact Germany, which relies heavily on exports that accounted for over 43% of its GDP in 2023.

Experts suggest that to maintain its status as a leading global economy, Germany must innovate and transition from traditional industries to new technologies.

Recent tariff announcements by Donald Trump, including a 25% duty on imported automobiles, threaten to undermine the competitiveness of German products in the U.S., which is their largest export market.

Germany's major exports, including motor vehicles, machinery, and chemical products, are under threat due to a slowing Chinese economy and rising domestic competition from electric vehicle manufacturers.

The ultimate impact of Trump's tariffs on the German economy will depend on their final levels, with forecasts indicating significant negative effects, even from indirect tariffs on other countries.

With approximately 1.2 million jobs in Germany linked to exports to the U.S., the potential job losses from increased tariffs are a significant concern.

High energy costs, particularly for natural gas, have led to production cuts and shutdowns among German industrial firms, raising alarms about potential deindustrialization.

Germany's strict borrowing limits are hindering vital investments in infrastructure and digitalization, further exacerbating the economic stagnation.

From 2005 to 2019, Germany's economy thrived on cheap Russian natural gas and strong demand from China, but these favorable conditions have since deteriorated.

The looming import tariffs proposed by Trump could pose significant obstacles for the new government, potentially boosting the far-right Alternative for Germany party if economic recovery fails.