The Ripple Effect: German Recession & EU Economy

International trade will be affected negatively, because Germany is an important component of the global supply chain: its economic problems will therefore rapidly induce similar problems across the whole EU and even beyond it.As a result, German banks and non-bank financial institutions will record a higher volume of non-performing loans that much increase Germany’s financial fragility. All this will slow down German imports from other EU countries, which thereby are also going to suffer and could fall into a recession.