Germany Is Breaking: €1 Trillion in Debt, NO Growth, and an Economic Collapse | Lena Petrova

World Affairs In Context

Germany was once the undisputed economic engine of Europe — defined by industrial dominance, export power, and ironclad fiscal discipline. That era is over. In this video, we break down why Germany is still trapped in a multi-year recession, why massive debt spending isn’t delivering growth, and why institutions like the Bundesbank and IMF are warning that the country faces something far more dangerous than a short downturn: long-term stagnation.

This week, the Bundesbank delivered a sobering forecast. Germany is not expected to return to pre-recession GDP levels until late 2026, meaning at least four years of lost economic momentum in Europe’s largest economy — despite nearly €1 trillion in new debt-funded spending focused on infrastructure and defense. Even worse, growth projections have been slashed, with 2026 growth now estimated at just 0.6%.

We explore:

• Why Germany’s debt-fueled recovery is failing
• How the budget deficit is set to hit levels not seen since reunification
• Why rising debt isn’t translating into productivity or competitiveness
• The impact of high energy costs, weak industrial demand, and global competition
• IMF warnings about demographics, shrinking labor supply, and structural decline
• Why militarization and short-term political spending won’t fix Germany’s economy

Germany still has fiscal room — but not unlimited time. Without deep structural reforms, productivity gains, and economic modernization, the country risks a slow, painful decline that will reshape not just Germany, but the entire European economy.