For decades, Germany has been a symbol of the post-war miracle of recovery, becoming Europe’s leading economic power. This success was no accident; it was built on three main pillars: cheap energy from Russia, free trade with the United States and its Western allies, and minimal military spending thanks to the US security guarantee after the Cold War.
But now the decision to turn away from Russia after the conflict in Ukraine is breaking this solid foundation. The consequences are already beginning to show, and Germany's economic future is becoming increasingly uncertain, according to RT.
Energy Crisis: Fatal Weakness
German industry, from autos to chemicals to metals, relies heavily on cheap energy from Russia. The bilateral energy relationship, especially through pipelines like Nord Stream, has been a key driver in keeping German factories running and exports competitive on international markets.
However, the Russia-Ukraine conflict forced Germany to abandon this energy source almost overnight. The Nord Stream pipeline was shut down, and Germany rushed to find alternatives. The result was a spike in energy prices, a production crisis, and the crippling of key industries.
Germany’s ambitious green transition plan is further exacerbating the problem. Renewables are not yet capable of replacing the steady energy supply provided by Russian gas. The phasing out of nuclear power – a stable, carbon-free source of electricity – further undermines the country’s energy security.
The world no longer favors free trade
Germany's economic success depends on a world of open, low-barrier trade. But the global order is changing rapidly. Rising protectionism, escalating US-China tensions, and the decoupling of major economies are threatening Germany's export-driven economy.
Germany’s deep trade relationship with China, its largest trading partner, has become a liability as geopolitical tensions between the West and Beijing have grown. At the same time, trade relations with the United States have also been challenged. The US administration has increasingly criticized Germany for insufficient defense spending, while Germany has benefited from the US market without paying its fair share.
Military burden: No small challenge
After the Cold War, Germany reduced its military spending to focus resources on economic and social development. However, the Russia-Ukraine conflict forced Germany to change its strategy. Pressure from NATO and its allies forced Germany to increase its defense budget to deal with the threat from Russia.
The cost of strategic mistakes
Germany has not only turned its back on Russia, but also forgotten the factors that made it successful: cheap energy, free trade and reasonable military spending. Current policies – from accelerating the green transition, distancing from China, to over-reliance on US strategy – are putting the German economy on a path of prolonged recession.
According to RT, if Berlin does not quickly adjust its direction, the "German economic miracle" could become a painful lesson in strategic mistakes.
