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THE BEST OF THE LOCAL 2011

NAZIS

The Local’s top five features of 2011

While the economy was on everyone’s mind this year, The Local’s feature writers took an in-depth look at stories that may have been off the radar. We’ve picked some of our favourites.

The Local's top five features of 2011
Photo: DPA

Is Germany’s right-wing scene out of control? And what happens when Germans seek pen-pals in American jails? These are just a few of the topics our feature writers delved into this year.

1) Germany’s sense of security was shaken when the existance of a neo-Nazi killing squad emerged in November. Have far-right extremists been turning increasingly to terrorist tactics?

Armed neo-Nazi scene embraces violence

The rise of the National Socialist Underground (NSU) has focused attention on Germany’s neo-Nazi scene, which experts say includes violent militants with professional weapons training

2) Germans love swapping letters with pen-pals – especially if they’re behind bars.

Convict connection: US pen pals found in jail

A growing number of Germans are striking up pen friendships with inmates serving time in US prisons. We go inside these unusual transatlantic relationships.

3) The September 11, 2001 terrorist attacks changed America forever. But they also had a profound effect on attitudes toward Germany.

Hamburg looks back a decade after 9/11

A decade after the 9/11 attacks, Hamburg remains stigmatized by perceptions it was a breeding ground for Islamist terrorists, according to the director of the city’s domestic intelligence service.

4) More than 100 million people speak German as their native language. But in some parts of the world, it’s endangered.

Lonely Star State: Texas Germans dwindling

Countless German immigrants moved to Texas in the 1800s, forming their own unique culture. With their language now near extinction, a professor is trying to preserve it.

5) Everyone knows about Europe’s economic struggles. But Germany is doing better than most countries. And it has the middle class to thank.

The family secret behind the economic boom

The backbone of Germany’s booming economy isn’t huge industry – it’s thousands of small and mid-sized firms spread across the country. The quiet achievers are part of the country’s Mittelstand.

The Local/mdm

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ECONOMY

German consumer prices set to rise steeply amid war in Ukraine

Russia's war in Ukraine is slowing down the economy and accelerating inflation in Germany, the Ifo Institute has claimed.

German consumer prices set to rise steeply amid war in Ukraine

According to the Munich-based economics institute, inflation is expected to rise from 5.1 to 6.1 percent in March. This would be the steepest rise in consumer prices since 1982.

Over the past few months, consumers in Germany have already had to battle with huge hikes in energy costs, fuel prices and increases in the price of other everyday commodities.

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With Russia and Ukraine representing major suppliers of wheat and grain, further price rises in the food market are also expected, putting an additional strain on tight incomes. 

At the same time, the ongoing conflict is set to put a dampener on the country’s annual growth forecasts. 

“We only expect growth of between 2.2 and 3.1 percent this year,” Ifo’s head of economic research Timo Wollmershäuser said on Wednesday. 

Due to the increase in the cost of living, consumers in Germany could lose around €6 billion in purchasing power by the end of March alone.

With public life in Germany returning to normal and manufacturers’ order books filling up, a significant rebound in the economy was expected this year. 

But the war “is dampening the economy through significantly higher commodity prices, sanctions, increasing supply bottlenecks for raw materials and intermediate products as well as increased economic uncertainty”, Wollmershäuser said.

Because of the current uncertainly, the Ifo Institute calculated two separate forecasts for the upcoming year.

In the optimistic scenario, the price of oil falls gradually from the current €101 per barrel to €82 by the end of the year, and the price of natural gas falls in parallel.

In the pessimistic scenario, the oil price rises to €140 per barrel by May and only then falls to €122 by the end of the year.

Energy costs have a particularly strong impact on private consumer spending.

They could rise between 3.7 and 5 percent, depending on the developments in Ukraine, sanctions on Russia and the German government’s ability to source its energy. 

On Wednesday, German media reported that the government was in the process of thrashing out an additional set of measures designed to support consumers with their rising energy costs.

The hotly debated measures are expected to be finalised on Wednesday evening and could include increased subsidies, a mobility allowance, a fuel rebate and a child bonus for families. 

READ ALSO: KEY POINTS: Germany’s proposals for future energy price relief

In one piece of positive news, the number of unemployed people in Germany should fall to below 2.3 million, according to the Ifo Institute.

However, short-time work, known as Kurzarbeit in German, is likely to increase significantly in the pessimistic scenario.

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